The Carlos Ghosn affair continues to feed lawyers on at least three continents, Nissan on Wednesday filing yet another lawsuit demanding $91 million from the company’s former boss stemming from his alleged financial misconduct.
Ghosn himself has fired off a flurry of lawsuits aimed at both Nissan and its French alliance partner Renault. Now, Nissan is shooting back. The claim Nissan filed with a court in Tokyo on Wednesday seeks to recover, among other things, legal and other costs connected with the long probe into alleged misconduct by Ghosn.
The Brazilian-born executive, once hailed as a hero for leading a bailout of then nearly bankrupt Nissan, was arrested in November 2018, shortly after his corporate jet landed at Tokyo’s Haneda Airport. He was accused, over the following months, of committing numerous acts of financial misconduct, including the concealment of millions of dollars of pay, stemming from a lengthy internal Nissan probe.
Ghosn ultimately spent about four months in the Tokyo Detention Center, confined to a small, unheated cell with a mat on the floor. When he was released on bail last spring he had to comply with extensive restrictions that, among other things, barred him from meeting with his wife or son.
The 65-year-old executive repeatedly proclaimed his innocence, most recently during a news conference in Lebanon where he fled to after pulling off an unexpected escape from Japan just before New Year’s Day. Ghosn has, among other things, accused Japanese officials at Nissan of staging a “coup’ meant to drive a wedge between it and Renault, the French carmaker that staked more than $5 billion to help save Nissan two decades ago.
The flight to Lebanon was “the most difficult decision of my life,” Ghosn said at a Beirut news conference on Jan. 8, contending he had to leave because of his belief he would never get a fair trial. Japan has a conviction rate of more than 90 percent.
Japanese prosecutors have since filed an arrest warrant against Ghosn, as well as three Americans allegedly involved in his December escape. Authorities in Turkey have also begun an investigation and targeted employees of an air freight company that reportedly assisted Ghosn who first landed in Istanbul before transferring to a second flight for Beirut.
Since his escape, lawyers have been filing an array of legal papers. Along with the new
suit filed by Nissan on Wednesday, the company has indicated it may pursue other actions. Last September, it alleged Ghosn had either received or was intending to pay himself $300 million.
For his part, Ghosn has filed both an $18 million damage suit against Nissan in the Netherlands and another claim in France for 250,000 euro, or $273,000, against Renault over pension payments. His lawyers last month signaled additional legal action could be filed against the French automaker. Ghosn, who held numerous roles with the Renault-Nissan-Mitsubishi Alliance, was fired by Renault after the Nissan scandal erupted.
The Alliance itself has been stretched near to the breaking point since Ghosn’s arrest. Behind the scenes, well-placed insiders have told TheDetroitBureau.com, cooperative efforts have all but come to a halt. Renault, hoping to hold the partnership together, broke off merger talks with Fiat Chrysler Automobiles last spring, FCA subsequently agreeing to a merger with Renault’s French arch-rival Groupe PSA.
Nissan has had its own problems, analysts saying the negative publicity, complicated by internal strife, has led to a sharp downturn in sales and earnings. The company last year announced major cutbacks including global layoffs, as well as cuts to its product line-up and production capacity.
It also has paid millions in fines in both the U.S. and Japan for concealing executive income. And it is facing a lawsuit by a California car dealer that claims a “culture of corporate corruption and greed” led to its own financial problems.
In one of the many ironies to emerge from the case, Hiroto Saikawa, who served as Nissan CEO when the internal probe into corruption began, was ousted last autumn after it was disclosed that he had also received unreported pay. He reimbursed Nissan, however, and has faced no criminal charges.
Additionally, Nissan may report its first quarterly loss in more than a decade, according to Reuters. The automaker reports quarterly earnings Thursday and a loss is expected due slumping sales, adding more pressure to the company’s post-Ghosn recovery efforts.