Multipolar sues Wal-Mart Inc. for $98.8 million
Multipolar sues Wal-Mart Inc. for $98.8 million
JAKARTA (JP): Publicly listed retailer PT Multipolar
Corporation is suing its U.S. partner, retail giant Wal-Mart
Store Inc. and its executives, for financial losses worth US$98.8
million for improper business practices.
Controlled by tycoon Mochtar Riady of Lippo Group, Multipolar
and its two subsidiaries -- PT Multipolar Perkasa and PT Inka
Prima Mulia Sejati -- also asked West Jakarta District Court
yesterday to order the defendants to pay nonmaterial losses of
US$100 million.
The firm's lawyer, Hotman Paris Hutapea, said Wal-Mart
allegedly mismanaged its joint venture with two Wal-Mart stores
here, issued misleading budgets, manipulated data inventory and
intentionally arranged financial claims and invoices.
"The defendants, for instance, presented a marked-up budget
and engineered tens of billions of rupiah in financial claims,"
the plaintiffs said in a statement of claim, which Hotman read to
the court.
The plaintiffs also asked the court to immediately issue an
order banning 12 expatriate Wal-Mart managers from leaving the
country.
The expatriates had allegedly approved each others' expense
claims and were throwing money around on excessive entertainment
and personal spending for various items, ranging from airline
tickets to hotels, children's school fees to sports equipment to
a dog carrier, the statement said.
The court was also asked to order Wal-Mart to continue
operating the two joint-venture stores at Lippo Supermal in
Karawaci, Tangerang, and Megamal Pluit in North Jakarta until
local employees could take over operations at the supercenters,
the statement said.
Multipolar also asked the court to order Wal-Mart to hand over
all files, documents and accounts related to the joint venture
because the U.S. company had threatened to leave the country and
take or destroy all the documents, it said.
Multipolar signed a joint venture agreement with Wal-Mart on
Aug. 16, 1995 to open stores here using the Wal-Mart name with
Multipolar supplying capital of $20 million for each store.
The plaintiffs said Wal-Mart had violated the agreement by
taking over the overall management of the supercenters which had
resulted in the stores suffering losses.
"Wal-Mart should have only given technical assistance as
stated in the agreement," the statement said.
All Wal-Mart violations had been uncovered by public
accountancy firm Hans Tuanakotta and Mustofa, it said.
Wal-Mart lawyers and executives could not be reached for
comment.
Presiding judge Andar Purba adjourned the trial until April 23
as Wal-Mart may need time to discuss the case with its U.S.
headquarters. (jun)