(LEAD) Supreme Court orders Samsung Securities to pay damages to NPS over 2018 dividend error

The Supreme Court of South Korea has recently ruled that Samsung Securities Co. must pay 1.86 billion won (approximately $1.3 million) in damages to the National Pension Service (NPS) following a 2018 dividend error. The error occurred when an employee accidentally issued 2.8 billion shares worth approximately 112 trillion won instead of paying 1,000 won per share to employees under a compensation plan.

The NPS filed a suit in response to the sharp decline in Samsung Securities' stock price on the day of the error, claiming damages of 29.9 billion won. The court upheld lower court decisions, concluding that there was a strong likelihood of a causal relationship between the firm's employee's negligence and the financial losses suffered by the NPS.

In the first instance trial, a lower court had initially limited Samsung Securities' liability to 50 percent, but both the lower court and an appellate court later upheld the higher court's final ruling.