[THE INVESTOR] A Seoul court ruled in favor of individual investors who suffered losses in the country’s biggest stock price manipulation caused by Deutsche Bank employees in 2010, paving the way for other victims who were originally led to believe the statute of limitations have expired.

On June 15, the Seoul Central District Court ordered Deutsche Bank in Germany and Deutsche Securities in Korea to pay 616 million won (US$538,000) plus interest for damages inflicted on 11 plaintiffs. It also rejected claims by the two firms that the statute of limitations for a civil suit expired in 2014. The plaintiffs are investors who lost money while investing in derivatives trading by setting up futures options accounts through Korean securities companies.

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“The court decision seems to be good news for other victims who were discouraged by the fact that the incident had been overdue,” said Kim Hyeong-woo, Seoul-base DR & AJU Law Group attorney representing the plaintiffs.

The decision resolves the case, locally referred to as the “Nov. 11 Deutsche Options Shock,” dating back to 2010 in which traders of Deutsche Bank dumped 2.4 trillion won worth of Korean shares, triggering a 2.7 percent drop on the country’s main KOSPI index.

Following the initial verdicts against the German bank’s Korean unit and a Korean employee in January 2016, individual victims have been filing damages lawsuits but the companies refused to indemnify them based on a three-year statute of limitations period -- the length of time victims have to bring their case to court.

Under civil law, the statute of limitations for claims involving damages runs 10 years from the date when the damages occurred and three years after the discovery of harm.

On June 15, the Seoul court ruled that the statute had not yet been completed, considering that verdicts and sentences in civil and crime suits related to the case were handed down in 2015 and 2016.

In April 2011, the Financial Services Commission, Korea’s top financial regulator, suspended some operations of Deutsche Bank’s local brokerage unit for six months after ruling that the bank manipulated the stock market.

At that time the regulator referred five Deutsche employees to prosecutors for investigation, as they made 45 billion won of improper profit by manipulating the stock market to make their derivatives positions profitable. One of the employees surnamed Park was sentenced to five years in prison in 2016.

By Park Han-na (hnpark@heraldcorp.com)