Ongpin appeals ruling on surrender of P412M profit from sale of Philex shares
MANILA, Philippines—Businessman Roberto V. Ongpin has asked the Court of Appeals to stop the Pasig City Regional Trial Court from proceeding with the hearing on a complaint that asks him to return the amount of some P412 million to Philex Mining Corp., which he got as profit after selling Philex shares a month after he bought them at a lesser price.
In his petition for certiorari, Ongpin said Pasig RTC Branch 158 Judge Maria Rowena Modesto-San Pedro had committed grave abuse of discretion when she dismissed Ongpin’s petition.
Ongpin sought a dismissal of the complaint on grounds that complainant, minority stockholder lawyer Mario Ongkiko, through his daughter and attorney-in-fact Atty. Zenaida Ongkiko-Acorda, gave insufficient payment of filing fee.
San Pedro, in her ruling dated April 3, 2012, said minority shareholders must not be thwarted by such fees from going after erring executives and board members if they themselves refuse to protect the company and its shareholders.
The derivative suit was filed by minority stockholder Mario Ongkiko when Philex management refused to sue Ongpin to recover his “short swing profits.”
The complainant alleged that under Section 23.2 of the Securities Regulation Code, an incumbent company insider like a director or officer is barred from profiting from trading in the same shares within a period of six months.
The short-swing profits of P412.5 million stemmed from Ongpin’s purchase of 50 million Philex shares from the Development Bank of the Philippines (DBP) at P12.75 per share on November 5, 2009, and selling the very same shares to Two Rivers Pacific Holdings Corp. of Manuel V. Pangilinan, Philex chairman, on December 7, 2009, at P21 per share.
The complaint also asked the court to direct Ongpin and his firms—Deltaventure Resources Inc. and Goldenmedia Corp.—to return to Philex other short-swing profits, if any.
In her resolution, San Pedro said that following existing jurisprudence, it is better that the correct amount of fees of more than P8.2 million be “considered a lien on the judgment to be rendered” than to straitjacket minority shareholders from seeking corporate best practices.
Aside from the temporary restraining order, Ongpin, in his petition to the Court of Appeals, asked that the April 3, 2012, ruling of the lower court be set aside and nullified “if there is sufficient ground.”
Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.