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Akinomaki

NSK sues a former advisor

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The NSK on the 25th sued a former consultant and his company, AT&C Japan for damages of 165 million yen. They had been entrusted with crisis management and other duties. During the period from Feb. 2012 to Jan. 2016, they allegedly received 80 million from a construction firm that did repair work in the kokugikan, 17 million yen from the broker of a pachinko maker who wanted to use rikishi names and other malpractice.

The NSK wants back the total of 85million yen for the subcontract fees and compensation for damaged trust.

AT&C refrained from giving a comment.

http://www.yomiuri.co.jp/national/20171228-OYT1T50104.html

Edited by Akinomaki
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Thanks for the Yomiuri link - the abbreviated info in the sports papers about this thing was pretty confusing.

Sports Hochi adds that Yoshihiko Kobayashi, the guy being sued, has had a suit of his own going since February 2016, demanding that the Kyokai reinstate the contract they cancelled. The consulting company was apparently dissolved in October, though. (Which may be either the cause or the result of the Kyokai's decision to sue.) In any case, the additional 80 million yen the Kyokai is demanding break down into 50 million for damages to its reputation and 30 million to reimburse its costs in investigating the alleged illegal activities.

Hochi also decided to include a casual aside (or casual smear, depending on one's perspective), saying "Kobayashi is said to be close to Takanohana", just in case anyone thought we might actually have some news that isn't related to any of the other stuff going on.

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Another breach of trust this Kobayashi is apparently accused of, is to have been the one to issue a 2nd kabu certificate for Kasugayama, who didn't get it back from the former holder. http://www.sumoforum.net/forums/topic/32037-another-growing-scandal-kasugayama-wants-his-kabu/

In May 2015 he made the then Kasugayama file an untrue report that the certificate got lost, though he knew that the former still had it in his possession.

http://www.zakzak.co.jp/spo/news/180118/spo1801180014-n1.html

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The cosultant's witness did not show up for the hearing today. No reason given. Next session on the 27th. The Kyokai side will have Hakkaku and Oguruma testifying, while Kobayashi himself is slated to testify.

Edited by Kintamayama
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The next hearing in this case - Hakkaku and Oguruma for the NSK: "Kobayashi was never a staff member", to the court: "Don't believe the pretext of Kobayashi, I'd like to ask for a wise decision."

Kobayashi about what Kitanoumi told him: "I know it will be hard, but please give us your support."

the other side: Kobayashi after the hearing

sum18022721250013-m1.jpgo

hearing the hearing were also Shibatayama, Fujishima and Takadagawa

sum18022721250013-m2.jpgo sum18022721250013-m3.jpgo

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On 2/27/2018 at 20:11, Akinomaki said:

The next hearing in this case - Hakkaku and Oguruma for the NSK: "Kobayashi was never a staff member"

Kobayashi about what Kitanoumi told him: "I know it will be hard, but please give us your support."

Yukan Fuji has some more details http://www.zakzak.co.jp/spo/news/180301/spo1803010002-n1.html

The witnesses were questioned for 4 hours.

Kobayashi: "Kitanoumi told me in the car before the riji-kai on Nov. 15th 2015 'I'll have you enter the NSK, so please don't refuse'" - Kitanoumi died on Nov. 20th and then the contract with Kobyashi was canceled.

A lot about the bribe money Kobayashi allegedly accepted and paid - also with his pretext of "The Cabinet office will take away the money from the NSK if we don't spend it on the bonds of this company."

Hakkaku: "I couldn't oppose a man brought in by Kitanoumi."

Oguruma: "Kitanoumi was present and regretfully I didn't have the courage to raise my voice and urge him."

Kobayashi is also blamed for having ex-Chiyonofuji ousted from riji, by secret maneuvers to have him lose at the election, because Kokonoe was trying to bring light into the suspected pachinko bribes - and Hakkaku claims that Kobayashi wanted to block him from becoming riji-cho.

Oguruma tells that also Kitanoumi had developed doubts, but said "I brought him in, I can't fire him" and consulted with the late sewanin Yuho.

- - very convenient that all who might confirm this are dead now

The affair is said to show how easy it was for a knowledgeable external to take control over the NSK management

- - but they have no knowledgeable insiders, and it seems that while both politics and society want it more open and more external control over the NSK, they want to use the thing prevent more of it

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As far as this new outsider's eyes can see, the official administrative structure of sumo is run by mostly middle-school graduates who reached the managerial class by being among the most successful wrestlers, and spent their adult years in a Spartan-style society (I'm purposely trying to overplay the argument, but it doesn't seem to be completely untrue). 

 

In this forum I've read indirect references to advisory councils at the heya and NSK level, and I know they have to hire or contract out technical and logistic duties.  However, while nobody in the world would know more about the sumo side of the business than these men, how would one expect them to be top-flight corporate managers?

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On 12/29/2017 at 15:43, Asashosakari said:

Sports Hochi adds that Yoshihiko Kobayashi, the guy being sued, has had a suit of his own going since February 2016, demanding that the Kyokai reinstate the contract they cancelled. The consulting company was apparently dissolved in October, though. (Which may be either the cause or the result of the Kyokai's decision to sue.) In any case, the additional 80 million yen the Kyokai is demanding break down into 50 million for damages to its reputation and 30 million to reimburse its costs in investigating the alleged illegal activities.

The verdict in the suit Kobayashi vs. NSK: the claims of Kobayashi were dismissed. The court decided that there was no employment, a note that ordered to employ him is seen as forged by him or on his orders.

The NSK is pleased and continues to demand damages from him.

http://www.sponichi.co.jp/sports/news/2018/08/29/kiji/20180828s00005000301000c.html

Edited by Akinomaki
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On 29/08/2018 at 12:07, Akinomaki said:

The verdict in the suit Kobayashi vs. NSK: the claims of Kobayashi were dismissed. The court decided that there was no employment, a note that ordered to employ him is seen as forged by him or on his orders.

Kobayashi filed an appeal to the Tokyo High Court, dating to Sep. 10th. http://www.sanspo.com/sports/news/20180913/sum18091321360020-n1.html

Edited by Akinomaki
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On 13/09/2018 at 18:13, Akinomaki said:
On 29/08/2018 at 12:07, Akinomaki said:

The verdict in the suit Kobayashi vs. NSK: the claims of Kobayashi were dismissed.

Kobayashi filed an appeal to the Tokyo High Court

That trial had its first day on the 17th, oral proceedings, and the whole trial is already concluded - the verdict will be pronounced on Feb. 6th. http://www.sanspo.com/sports/news/20181218/sum18121805010001-n1.html

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On 18/12/2018 at 10:15, Akinomaki said:

That trial had its first day on the 17th, oral proceedings, and the whole trial is already concluded - the verdict will be pronounced on Feb. 6th.

Kobayashi vs. NSK: appeal rejected - there was no employment contract. http://www.nikkansports.com/battle/sumo/news/201902070000083.html

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On 07/02/2019 at 17:48, Akinomaki said:

Kobayashi vs. NSK: appeal rejected - there was no employment contract.

Kobayashi did not file an appeal to the highest court, today this trial ended with the NSK winning the lawsuit.

In the case NSK vs. Kobayashi for damages after malpractice, the NSK increased the amount they demand from 165 million to 386.5 million yen. http://www.sanspo.com/sports/news/20190304/sum19030419430007-n1.html

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On 04/03/2019 at 21:17, Akinomaki said:

Kobayashi did not file an appeal to the highest court, today this trial ended with the NSK winning the lawsuit.

In the case NSK vs. Kobayashi for damages after malpractice, the NSK increased the amount they demand from 165 million to 386.5 million yen. http://www.sanspo.com/sports/news/20190304/sum19030419430007-n1.html

Oral proceedings of the trial for damages were held on the 13th. The NSK now wants 510 million Yen. https://www.sponichi.co.jp/sports/news/2021/10/14/kiji/20211014s00005000108000c.html

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Hakkaku Rijicho testified today. "This is very regrettable. I want to do everything so that this will never happen again," he said later.

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On 14/10/2021 at 11:35, Akinomaki said:

Oral proceedings of the trial for damages were held on the 13th. The NSK now wants 510 million Yen.

originally

On 29/12/2017 at 15:16, Akinomaki said:

The NSK on the 25th sued a former consultant and his company, AT&C Japan for damages of 165 million yen. They had been entrusted with crisis management and other duties. During the period from Feb. 2012 to Jan. 2016, they allegedly received 80 million from a construction firm that did repair work in the kokugikan, 17 million yen from the broker of a pachinko maker who wanted to use rikishi names and other malpractice.

The NSK wants back the total of 85million yen for the subcontract fees and compensation for damaged trust.

AT&C refrained from giving a comment.

The trial proceedings ended today, the verdict will be issued on June 8th. https://www.jiji.com/jc/article?k=2022021800598&g=spo

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On 18/02/2022 at 10:11, Akinomaki said:

The trial proceedings ended today, the verdict will be issued on June 8th. https://www.jiji.com/jc/article?k=2022021800598&g=spo

The verdict: former advisor Kobayashi has to pay 96 125 758 yen, the NSK in the end wanted 510 million yen.

The court ruled that Kobayashi individually had taken 170 million yen from 7 firms for selecting them for repair works in the kokugikan and other things. As a result the NSK paid higher fees to those firms, part of the subcontract fees for the advisor were also acknowledged as damages.  On top of that, the NSK had damaged trust after a video surfaced on the net that shows the acceptance of a bribe in connection with a contract over the use of shikona and more by a pachinko maker.

Hakkaku in a comment called  the court decision a proper one, "So that this will not happen again, we will focus our attention even more on being thorough with compliance." http://hochi.news/articles/20220608-OHT1T51192.html?page=1

Edited by Akinomaki
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So basically to put it in slightly less incomprehensible jargon: breach of fiduciary duty by an agent.

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How much did they spend litigating this?  I'd be surprised if they did much better than break even.  The truth is, in many lawsuits, the only winners are the lawyers.

Edited by Gurowake
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15 hours ago, Gurowake said:

How much did they spend litigating this?  I'd be surprised if they did much better than break even.  The truth is, in many lawsuits, the only winners are the lawyers.

The universal rule it seems

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20 hours ago, Gurowake said:

How much did they spend litigating this?  I'd be surprised if they did much better than break even.  The truth is, in many lawsuits, the only winners are the lawyers.

Assuming the damages are paid out, that's between $800,000 and $900,000. I'd say they're likely to pocket a bit, but it's not exactly a windfall. If it's appealed and the NSK remains successful, breaking even seems about right. That said, I have no idea how the Japanese system deals with awards of costs, if at all, which might change things considerably. 

However, even assuming they somehow pocket all of it, that isn't all that much cash for an organization the size of the NSK. More likely it's of symbolic importance with an aim deter future shenanigans ("mess with us and we'll see a lawsuit through"). Not that it's likely to do so, but that's often the thought.

The lawyers, however, definitely won any which way. 

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In some legal systems, the winner's legal costs must be borne by the loser, to ensure that exactly this kind of perverse scenario doesn't happen (where what you win wouldn't cover the legal fees). So in theory, you needn't factor that into your considerations of whether or not to go to court; just a matter of your own time investment vs the chances of getting your rightful dues (balanced against the risk of losing and not only wasting your own costs, but being forced to pay the other side's costs and even damages in a countersuit etcetc).

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19 minutes ago, Seiyashi said:

In some legal systems, the winner's legal costs must be borne by the loser, to ensure that exactly this kind of perverse scenario doesn't happen (where what you win wouldn't cover the legal fees). So in theory, you needn't factor that into your considerations of whether or not to go to court; just a matter of your own time investment vs the chances of getting your rightful dues (balanced against the risk of losing and not only wasting your own costs, but being forced to pay the other side's costs and even damages in a countersuit etcetc).

I think it depends on both the type of lawsuit and how egregious the behavior of the other party.  I suppose I'm thinking more along the lines of what happens when people settle, which is the vast majority of cases at least in the US.  No one admits fault, and you get what you get and have to pay the costs out of it.  For verdicts that come from trial I think it's more likely that some costs will be born by the losing party, but I'm guessing that there can't just be carte-blanche approval of all legal costs or else there's perverse incentive for lawyers to run up costs, which they likely do anyway.  A lawyer friend of mine even noted that in an opposing counsel's office there was a sign by the copier that in the types of cases where legal fees are born by the loser, only the highest-billing attorney on the case should be doing the copying.  It's hard to get around that sort of inflation of costs without doing a comprehensive audit.

Edited by Gurowake

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13 minutes ago, Gurowake said:

I'm guessing that there can't just be carte-blanche approval of all legal costs or else there's perverse incentive for lawyers to run up costs, which they likely do anyway.

At least in my jurisdiction there's a process called taxation of costs, which is basically where the losing party goes to the judge and says "hey this can't be right", and a taxed bill is usually much more strict as to what is allowable or reasonable. So the possibility of getting an overinflated bill going to the judge is enough to keep people somewhat honest, especially because you can be pretty granular about which subsections of the overall suit have costs allowed and which do not.

As for settlement, while each party does have to bear their costs, there's a greater movement towards court-mediated settlement processes which keep it simpler and cheaper for all parties concerned, since you don't have to engage a lawyer.

Edited by Seiyashi

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