An appeals court has upheld the acquittal of Koo Yeon-kyung, head of the LG Welfare Foundation and eldest daughter of the late Koo Bon-moo, former chairman of LG Group, and of her husband. The couple were tried on charges of trading stocks on material nonpublic information, and the verdict now stands after both the first trial and the appeal.

On November 11, the Seoul High Court's Criminal Division 4-3, headed by Presiding Judge Jeon Ji-won with Judges Kim In-gyeom and Sung Ji-yong, rejected the prosecution's appeal. The appeal concerned Koo and her husband, Yoon Kwan, CEO of BlueRun Ventures (BRV), who were accused of violating the Financial Investment Services and Capital Markets Act (the Capital Markets Act). The court left the lower court's acquittal in place.

Explaining its decision, the court said, "(Koo) had considerable capacity to invest but put only part of her funds into stocks. After buying the shares at issue, she disclosed the purchase to employees around her without apparent hesitation, which is far from the behavior of someone seeking an improper gain."

The court added, "Even if some points seem unclear, they do not amount to direct evidence sufficient to establish the charges. It is hard to say it has been proven beyond a reasonable doubt that Koo received information about the shares at issue from Yoon and then bought them, so the lower court's ruling to the same effect was justified."

Prosecutors had accused Koo of learning in advance that BRV, where her husband is chief investment officer, planned to invest 50 billion KRW (about 37 million USD) in Mezzion, a Kosdaq-listed biotech company, through a third-party allotment of new shares in April 2023. They said she then bought about 650 million KRW (about 481,000 USD) worth of Mezzion shares, earning improper gains of about 105.66 million KRW (about 78,200 USD).

The lower court had found no direct evidence that Yoon passed nonpublic information to Koo.

It also held that the charge that Koo bought Mezzion shares on material nonpublic information had not been proven. In its view, the purchase was fairly small compared with the amounts she spent on other stocks and with her overall assets, and she had not sold the shares to realize a profit.

The lower court said, "There does not appear to have been any in-depth conversation between the two about buying or selling stocks in the ordinary course," adding, "It is difficult to find the defendants guilty on circumstantial evidence alone."

Prosecutors (now the Public Prosecution Office) appealed against that ruling.

An appeals court has upheld the acquittal of Koo Yeon-kyung, head of the LG Welfare Founda …

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