Korea Zinc vs. Young Poong and MBK: Another Clash Over Project Name

U.S. Integrated Smelter Project Name "Project Crucible"

Korea Zinc reports Young Poong, MBK for "unauthorized use of the name"

Young Poong and MBK counter, calling it "infringement on corporate value enhancement activities"

The dispute between Korea Zinc and its largest shareholders, Young Poong and MBK Partners, has now extended to an issue concerning the use of the name for the U.S. integrated smelter project, "Project Crucible." On August 5, Korea Zinc announced in the morning that it had filed a police complaint against MBK Partners and Young Poong. In response, Young Poong and MBK Partners issued a statement refuting Korea Zinc's actions later the same day.

Korea Zinc: "Young Poong and MBK causing confusion by unauthorized use of the project name"

Earlier that morning, Korea Zinc stated that it had filed a complaint with the Seoul Jongno Police Station against Korea Corporate Investment Holdings, Young Poong, MBK Partners Vice Chairman Yoon Jongha, Youngpoong Bookstore Holdings CEO Jang Se-hwan, and others for violating the Unfair Competition Prevention Act and for interfering with business operations.

Korea Zinc alleges that the opposing parties registered a domain name on June 27, combining the project name and the site location—Tennessee, United States—and then, in early July, distributed invitations that featured the project name to Tennessee state government officials and others, leading recipients to mistakenly believe that the project was led by Korea Zinc.

Korea Zinc further claims that at a local reception held on July 9, MBK introduced its global investment portfolio and made remarks suggesting that Young Poong's Seokpo Smelter technology could be applied to the project, which, according to Korea Zinc, interfered with their business operations.

A representative from Korea Zinc commented, "After Korea Zinc announced the launch of Project Crucible, MBK and Young Poong filed for an injunction the following day in an attempt to block the project. Now, they are promoting themselves as if they are the main drivers of the project, which is an act of deceiving both the governments of both countries, as well as investors and shareholders."

Young Poong and MBK: "Challenging activities that enhance corporate value is an infringement on shareholder rights"

Young Poong and MBK Partners rebutted that the main issue is not about the name usage, but rather that Korea Zinc is calling into question the legitimate shareholder activities of the largest shareholders.

In a statement issued later in the afternoon, they stated, "Korea Zinc is a company owned by all its shareholders, not by a specific group of executives. It is a typical behavior of outdated management to use corporate funds and file a police complaint in the company's name to attack shareholders over activities that are intended to enhance corporate value."

They also called the name issue unfounded. According to Young Poong and MBK Partners, "'Project Crucible' is not a registered trademark exclusively owned by Korea Zinc, and the project name and related business details have been publicly disclosed by Korea Zinc themselves."

They went on to state that they had clearly identified the event organizer for the relevant communication event, saying, "To label this as impersonation or infringement of business marks is a distortion of both the facts and legal principles."

"The injunction was not against the project itself"... Conflicting interpretations

The two parties also differ in their interpretation of the injunction filed in December of last year. Young Poong and MBK asserted that the injunction was "not intended to block Project Crucible itself, but rather to prevent Executive Director Choi Yoon Bum from engaging in an unlawful attempt to defend his control by issuing unnecessary new shares under the guise of the project to increase supportive stakes." They emphasized that "project promotion and protection of shareholder rights are compatible objectives."

Young Poong and MBK Partners further called for an immediate halt to what they described as Executive Director Choi Yoon Bum's use of company assets, organizational resources, and external communication channels to defend his personal management control, and insisted that "what management should be doing is not attacking the largest shareholder, but rather working to increase corporate value and protect the interests of all shareholders."

Meanwhile, Project Crucible is a project announced by Korea Zinc on December 15 of last year to invest $7.4 billion (approximately 11 trillion won) together with the U.S. government and strategic investors to build a large integrated smelter in Tennessee. At that time, MBK Partners and Young Poong filed for a provisional injunction to prohibit the allocation of new shares through a third-party paid-in capital increase intended for the investment, but the court dismissed the request.

This content was produced with the assistance of AI translation services.