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October 13, 2016

Toshiba sued by shareholders over accounting scandal

Forty-five shareholders filed a lawsuit in the Tokyo District Court, seeking compensation for damages caused by Toshiba’s inappropriate accounting.

By CBR Staff Writer

A group of shareholders, mainly foreign institutional investors, have sued Toshiba over its accounting scandal, seeking over JPY 16.7bn (about $160m) in damages.

Toshiba said that the 45 unnamed shareholders filed a lawsuit in the Tokyo District Court, seeking compensation for damages caused by its inappropriate accounting.

The company said it will handle the matter appropriately by taking into account the plaintiffs’ assertions.

toshiba-2According to Toshiba, the lawsuit’s impact has been incorporated into its consolidated forecast for fiscal 2016 released last month since the plaintiffs informed the company of their intention to sue before filing the lawsuit.

The latest charges follow 15 other lawsuits seeking compensation of a combined JPY15.3bn (about $147m) for damages. Toshiba had last year admitted to reporting inflated profits, which dates back to 2008.

The Japanese firm said with respect to these actions, it has recorded provisions for a reasonably estimable amount that is needed for accounting purposes.

Japan Trustee Services Bank and the country’s public pension fund have also sued the company seeking $115m and $10m, repectively, in damages.

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The Government Pension Investment Fund is thought to be the first institutional investor in Japan to sue Toshiba over the scandal.

Last November, Toshiba sued five former executives for damages over their alleged roles in the accounting scandal.

The company sought damages totalling $2.4m from previous CEO Hisao Tanaka, his two predecessors and two former chief financial officers.

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