Former Lotte Holdings vice chairman Shin Dong-joo on Thursday sued his younger brother and Lotte Group chairman Shin Dong-bin to take claim of what he “was destined to have” -- control of the retail giant.

In an impromptu press conference, the eldest son of Lotte founder and honorary chairman Shin Kyuk-ho claimed that his expulsion from managerial roles of Lotte affiliates in both Korea and Japan was made through illegitimate processes, and that he would seek reinstatement as well as compensation. 

“For a long time, Dong-bin and I had our own roles in the company. However, Dong-bin has been greedy, and took over our (Dong-joo and Kyuk-ho) roles illegally,” Dong-joo said via a statement.

His wife Cho Eun-ju read the statement on his behalf due to his limited Korean speaking level.He arranged the press event at The Westin Chosun Hotel situated right next to Lotte Hotel in central Seoul.

Dong-joo on Thursday filed a lawsuit against the management of Hotel Lotte and Lotte Hotel Busan in Korea, where he was sacked from the executive position. He also said he would sue board members of Lotte Holdings, the de facto holding company of Lotte in both Korea and Japan.

The disgraced heir demanded his reinstatement at the board room and about 1.2 billion won ($1 million) in compensation for the damage inflicted by the dismissal. He also urged all board members involved in his dismissal to step down.

Dong-joo is believed to have established a company -- SDJ Corporation -- to control the litigation.

Shin Kyuk-ho filed for injunction against Lotte Shopping in order to read the company’s accounting records. As a means to appeal to the public about the warfare, Dong-joo unveiled a photograph showing Kyuk-ho signing the warrant of attorney leaving the case to Dong-joo’s discretion.

“The general chairman (Shin Kyuk-ho) has been devastated. He wants everything to be reinstated, and all people related to the matter including my younger brother to be punished,” Dong-joo said.

Mindful of public antipathy toward the opaque governance structure of Lotte, Dong-joo revealed that he is the largest shareholder of Kojyunsya, which owns 28.1 percent of Lotte Holdings, which owns 99 percent of Hotel Lotte in Korea. The hotel chain reigns Lotte affiliates in Korea through carious cyclical shareholding structure.

“This makes Dong-joo the legitimate manager of Lotte,” Dong-joo’s attorneys said.

Dong-joo accused his younger brother of underperformance. “He may have done a few things right in the past, but lost a lot of money in China,” he said.

Shin Dong-joo was ousted from the vice president position of Lotte Holdings on July 28 when his younger brother called up the board members in Tokyo and approved the deal. Dong-bin reportedly made the decision after learning that Dong-joo convinced their father to transfer the power to Dong-joo and suspend Dong-bin from Lotte chairmanship.

The brotherly war ended on Aug. 17 when shareholders’ meeting approved Dong-bin as the sole leaders of Lotte Group, which caused Dong-joo’s dismissal from all Lotte affiliates. Since then, Dong-joo has remained virtually powerless even though he has major shares in the business empire.

Lotte Group stated that the helm of the business empire is firm and will not be perturbed.

By Bae Ji-sook (baejisook@heraldcorp.com)