Abu Dhabi, UAESunday 20 September 2020

Nissan sues its former chairman for Dh333.7m in damages

The damages sought by the car maker could represent a significant part of Carlos Ghosn’s net worth

Carlos Ghosn, former head of Nissan, was effectively allowed to pay himself whatever he liked at the Japanese car maker. Reuters
Carlos Ghosn, former head of Nissan, was effectively allowed to pay himself whatever he liked at the Japanese car maker. Reuters

Nissan is stepping up its pursuit of claims against former chairman Carlos Ghosn, suing for 10 billion Japanese yen (Dh333.7m) in damages from the former leader of the Japanese automaker and its alliance with Renault.

The lawsuit filed in Yokohama District Court seeks to “recover a significant part of the monetary damages inflicted on the company by its former chairman as a result of years of his misconduct and fraudulent activity”, Nissan said on Wednesday.

The amount of the claim may rise depending on fines and penalties that Nissan will be obliged to pay, the carmaker added.

Mr Ghosn was arrested in November 2018 on charges of financial wrongdoing, and faced trial in Japan until he made a dramatic escape to Lebanon at the end of December last year.

Nissan and Japanese prosecutors claim the former auto executive under-reported his income and used company money for personal gain, charges which Mr Ghosn has denied.

The damages sought by Nissan, if successfully reclaimed, could represent a significant part of Mr Ghosn’s net worth. The former auto executive’s fortune is calculated to be about $70m, down from around $120m at the time of his first court appearance a year ago, according to estimates by the Bloomberg Billionaires Index.

A spokesman for Mr Ghosn said his lawyers haven’t yet been able to review the complaint, which appears to be part of Nissan’s “manoeuvring.”

“The legal actions form part of Nissan’s policy of holding Mr Ghosn accountable for the harm and financial losses incurred by the company as a result of his misconduct,” the Yokohama-based company said.

Nissan isn’t the only party intent on going after Mr Ghosn. Masako Mori, Japan’s justice minister, said recently that she will “never give up” on bringing Mr Ghosn to trial, even though the country has so far made little progress on its efforts to have him returned from Lebanon, which has no extradition treaty with Japan.

Mr Ghosn, for his part, is pursuing claims against Nissan, saying he was wrongly dismissed from the carmaker’s Dutch unit and by a joint venture called Nissan-Mitsubishi. He is claiming 15m euros ($16.4m) in lost income.

The 65-year-old, who was facing two trials on charges of financial misconduct in Japan, jumped bail and fled the country late last year with the help of a security detail led by a former Green Beret. Mr Ghosn has since accused executives at Nissan of plotting with prosecutors in Japan to have him unjustly arrested.

The 10 billion yen total that Nissan is seeking is based on payments made to or by Mr Ghosn, including “the use of overseas residential property without paying rent, private use of corporate jets, payments to his sister, payments to his personal lawyer in Lebanon” as well as costs related to the investigation into his actions, and legal and regulatory fees.

Nissan filed a civil lawsuit against Mr Ghosn in the British Virgin Islands in August 2019, seeking damages and the title of a luxury yacht. Nissan also said it may pursue separate legal action over “groundless and defamatory remarks made by Mr Ghosn in comments to the media following his escape to Lebanon in violation of his bail conditions in Japan.”

Updated: February 12, 2020 08:43 PM

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