The Tokyo District Court on Thursday ordered former Livedoor Co. executives, including founder and former President Takafumi Horie, to pay ¥1.46 billion in compensation for stock losses to a group of shareholders due to accounting fraud.
The 410 shareholders, mostly individuals, demanded Horie, 36, and other defendants pay about ¥4.4 billion to make up for the losses.
The stock price of Livedoor, now LDH Corp., had once soared due partly to the firm's window-dressed earnings and then plunged when prosecutors carried out a surprise raid on the firm in connection with the accounting fraud.
The court ruled Livedoor made a "grave misstatement" in the financial report for the business year through September 2004, and calculated the amount of damages as ¥200 per share. The plaintiffs bought Livedoor shares between December 2004 and January 2006.
The amount of loss would have been ¥585 per share under the former securities exchange law, which set the amount of damages incurred by a fictitious earnings report by comparing the stock prices a month before and after the release of the earnings report in question. However, the court reduced the amount, saying other factors, including the raid on the company, caused the stock price to suddenly plummet.
The court also dismissed the claim of eight plaintiffs who said they suffered damages from owning shares in a Livedoor subsidiary.
LDH said it intends to appeal the ruling.
"Although we understand that the court partially recognized the validity of our argument, we have some points we are dissatisfied with," said a representative of the company.