Sumio Sakata and Others v Fuminori Paul Naruse and Others

Choo Han Teck J:

[2] When the second defendant changed solicitors she applied for a variation of the orders and was granted an order for $20,000 in her favour to be apportioned from the original sum of $375,000. In addition to that, a further sum of $300,000 was ordered to be provided for her benefit.

[3] The second defendant regarded herself as a “major player” and submitted that even the plaintiffs’ solicitors admitted as much. Her counsel submitted that she had to change solicitors because it appeared that there might be conflict of interests between herself and the first defendant. She had taken a long time to appreciate this potential complication.

[5] This is an action commenced by the four Japanese plaintiffs against the 16 defendants. The first and second defendants are the principal defendants. The others are either nominees or corporate vehicles allegedly used by the first and second defendants. The claims are substantial. Some of them have not yet been quantified, but the dozen or so that have been, exceeded $30,000,000. The claims were based on breaches of fiduciary duty and conspiracy to defraud. The background of this dispute between the parties as set out in the lengthy statement of claim was that the first and second plaintiffs were misled into investing money in companies pursuant to representations by the first and/or second defendants that those companies held valuable technologies that had attracted interested purchasers including Lucent Technologies. Consequently, companies were incorporated in Japan and elsewhere, and loans were procured from or through the first and second plaintiffs, to meet the arrangements proposed by the first and second defendants.