[비즈한국] As the ruling on the divorce of Kwon Hyuk-bin, Chief Visionary Officer (CVO) and founder of the domestic gaming company Smilegate, mandates that he "transfer stocks worth 2.5 trillion won to his spouse," the legal community is anticipating a potential appeal. Although Kwon holds 100% of the shares, meaning his management control is not immediately threatened, there is a risk of “clashes” during major decision-making processes.
However, legal experts suggest it will not be easy for CVO Kwon to overturn the result in the second trial, noting that the structure of this case differs from the divorce suit between SK Group Chairman Chey Tae-won and Art Center Nabi Director Roh Soh-yeong, which previously held the record for the largest property division.
First Trial Recognizes 35% Stake for Wife Due to Early Involvement and Investment
The divorce case of Smilegate founder and CVO Kwon Hyuk-bin, who built an asset empire worth 8 trillion won through global mega-hits "Crossfire" and "Lost Ark," has resulted in what is officially the "largest property division in history," as expected.
On the 9th, the Seoul Family Court (Presiding Judge Jung Dong-hyuk) ruled in the first trial of the divorce between CVO Kwon and his spouse, identified as Ms. Lee, that Smilegate’s corporate value stands at approximately 7 trillion won. The court ordered that “CVO Kwon transfer 35% of his Smilegate shares to Ms. Lee in kind (worth approximately 2.4867 trillion won) and pay 650 billion won in cash.” This amount far exceeds the 944 billion won awarded to Director Roh Soh-yeong, setting a new record.
CVO Kwon holds a 100% stake in Smilegate Holdings, the top-tier holding company of the Smilegate Group. If 35% of the shares are transferred in kind to Ms. Lee as per the first-instance ruling, Kwon’s stake would drop to 65%. Since he would no longer be able to secure two-thirds (66.7%) of the voting rights of attending shareholders, independent decision-making on key issues such as mergers and divisions would become difficult.
Because the positions of CVO Kwon, who refused the divorce itself by stating, “The marital relationship has not collapsed and I wish to maintain the family,” and Ms. Lee, who argued that “I should receive 50% of the shares,” were sharply divided throughout the first trial, the legal community expects both sides to file an appeal.
A legal expert familiar with the case explained, “While his management rights won't be immediately shaken, Kwon had enjoyed rapid decision-making due to his 100% stake. He might appeal to reduce the transferred stake to under 30% or negotiate by offering cash instead. Meanwhile, Ms. Lee, who secured investments through her family at the time of the company's founding, will likely also appeal to demand a larger share, using that as justification.”
Different from the ‘Inherited’ Case of SK Chairman Chey Tae-won?
The legal community is focusing on the fact that while the process of building wealth differs from the case of SK Group Chairman Chey Tae-won and Director Roh Soh-yeong, the outcome was remarkably similar.
In Chairman Chey’s case, there were strong grounds to argue that the inherited SK Group shares were “separate property.” However, even though the case of CVO Kwon and Ms. Lee involves a “joint startup where the couple built the business from scratch after marriage,” both cases resulted in a property division in the mid-30% range.
CVO Kwon and his wife, Ms. Lee, met as campus couples at Sogang University and married. The following year, in 2002, they founded Smilegate with 50 million won in capital. Ms. Lee held a 30% stake during the early days of the company and was even registered on the corporate registry as a representative director and internal director. Although Ms. Lee focused on housework and child-rearing, the first-instance court took all these factors into account and recognized a 35% share—higher than the "typical" 20–30% usually allocated to a full-time homemaker.
Considering that the division ratio in the Chey Tae-won–Roh Soh-yeong divorce suit was approximately 67% to 33%, some observers even suggest that the portion of Smilegate shares subject to division could potentially increase in the second trial.
A partner at a major law firm hinted, “Director Roh Soh-yeong received 33% despite no recognized direct contribution to management. Given that Ms. Lee secured investment from her family and was listed as an early representative director and board member, I think CVO Kwon could end up in an even more disadvantageous position in the future.”
An appeal can be filed within two weeks of the delivery of the written judgment, and neither side has yet declared whether they will do so. However, it is widely predicted that both parties will engage in a fierce battle over whether Ms. Lee should be considered a “co-founder.” CVO Kwon’s side argues, “Ms. Lee never actually contributed capital or worked at the company, so she cannot be considered a co-founder.” Conversely, Ms. Lee’s side is expected to counter, “She held 30% of the shares through her family’s support during the early stages and has a history of being listed as a registered director and CEO, so she must be viewed as a co-founder.”
A lawyer and former judge experienced in corporate divorce cases noted, “Director Roh Soh-yeong switched from demanding shares in the first trial to demanding ‘cash’ in the second to reduce unnecessary controversy over management rights. Since the structure of CVO Kwon and Ms. Lee's case is different, both sides are likely busy consulting with their lawyers to analyze the first-instance ruling and determine what logic to employ in the second trial to secure even a fraction more.”