Hong was never an EPL shareholder himself. His company was not even incorporated until September 2016, and it acquired a minority stake only in 2017 – after the events he later went to court over.
That timing proved fatal. In the main case, filed in February 2020, Hong and his company alleged that EPL acted oppressively by failing to enforce a confidentiality agreement with an entity tied to Ka An, which they said let the rival seize control unfairly. They sought US$50 million in damages and orders forcing Ka An to sell its shares, hold a fresh director election, and replace the chief executive and operating officers.
Justice Hoffman struck the claim. The oppression remedy protects shareholders, and Hong’s complaints concerned conduct that predated his company’s arrival on the share register. A failed bidder for control, the judge found, does not get to use an oppression claim to relitigate a lost contest. The related conspiracy allegation was thrown out too, on the basis it raised no genuine issue for trial.
The two remaining cases, tied to transactions EPL allegedly entered with a company called Great Wall in 2022, met the same end. Here the problem was different but just as basic. The harms Hong described – a depressed share price, diluted holdings, diverted opportunities – were losses felt by the company and all its shareholders, not unique injuries to him. Claims like that are derivative, the court held, and require leave he had not sought.
The judge went further, finding the Great Wall cases an abuse of process and a continuation of what he called Hong’s campaign to seek retribution for his failed takeover bid. An earlier judge had already refused to let his company pursue a derivative action over related transactions, finding Hong was not acting in good faith.
