TOKYO: Japan’s $1.3 trillion public pension fund said Thursday that it has sued embattled Toshiba Corp. for nearly $10 million in damages after an accounting scandal that pushed down the electronics company’s share price. The Government Pension Investment Fund, the world’s largest of its kind, is believed to be the first institutional investor in Japan to sue Toshiba over its $2.1 billion accounting scandal. Fifty individual shareholders filed suit together in December.
A GPIF spokesman confirmed that a lawsuit filed by one of its asset managers against Toshiba in May was made on behalf of the fund. A representative for the asset manager, the Japan Trustee Services Bank Ltd., said that it pursues lawsuits on behalf of investors whose money it manages but declined to comment further. The first hearing was held Tuesday.
Toshiba CEO Satoshi Tsunakawa declined to comment on the lawsuit, saying, “we will wait and see the developments” of legal claims against the company. “Our journey to restore investor confidence and trust has just begun. We will make more efforts, with a sense of vigilance,” he said.
The Toshiba scandal unfolded last year as Prime Minister Shinzo Abe pushed companies to increase their transparency and accountability to shareholders in a bid to attract more foreign investment. Mr. Abe’s government has urged investors to work to improve medium- and long-term returns for clients and pensioners, and in 2014 unveiled the Japan Stewardship Code outlining those responsibilities.
Toshiba’s share price has plummeted after it revealed in September that it had overstated earnings by ¥224.8 billion ($2.1 billion) over seven years, one of the biggest accounting scandals in Japan in recent years. It isn’t uncommon for large investors to sue companies for damages after a scandal. The GPIF has sued companies in the past, including Livedoor Co. and Seibu Railway Co., both of which settled.
