Wanda Takes Legal Action Over "Malicious Rumors" About Chairman Wang
Demanding public apologies and millions in compensation, the company has issued an aggressive response to the local media outlets that alleged the company's billionaire boss had been detained.
Chinese conglomerate Dalian Wanda Group is making good on its promise to pursue aggressive legal action against those who propagate "malicious rumors" about the company's billionaire chairman Wang Jianlin.
On Aug. 28, dozens of Chinese news sites and social media accounts issued reports alleging that Wang had been detained by Chinese authorities while trying to board a flight to the U.K. with his family. The articles claimed that the tycoon was barred by Beijing from leaving the country. Wanda quickly issued a statement denying the claims as "false and malicious," but not before the widely shared reports rattled the nerves of Chinese investors, sending shares in one of the conglomerate's Hong Kong-listed subsidiaries crashing 10 percent.
Wanda said Wednesday that it had filed lawsuits against individuals and entities involved in spreading the allegations on Chinese social media. Noting that Chinese courts had already accepted the civil cases, Wanda said it also was preparing to press criminal charges in some cases. The company's announcement made note of Beijing's strict new laws against spreading false information online in China.
The decision to sue is understood to have come straight from the top, with Wang said to be incensed over the rumors and their damage to his company's reputation, according to sources with knowledge of the situation.
In its public statement, Wanda named several of the Chinese media outlets it is challenging in court, such as Asia News Weekly and New People Magazine, as well as individuals. The company said that it is requesting that the parties issue public apologies over their official social media accounts and provide Wanda with compensation of 5 million yuan (about $760,000) each.
"Wanda Group states that it is not only pursuing economic and criminal charges against rumormongers and defending its dignity," the company's statement read, "but also using legal measures to issue a warning to media outlets lacking ethics or basic moral standards as well as to help create a cleaner Internet environment."
Wanda said it was also considering legal action in the U.S. against the obscure Chinese-language blog Boxun, which appears to have been a primary source of the reports of Wang's alleged detention. Wanda said it intends to demand a public apology and compensation of $2 million from Boxun.
Wanda and several other Chinese conglomerates, including Fosun International and HNA Group, are under heavy regulatory pressure over their recent track records of leveraged overseas dealmaking — a pattern Beijing regulators have sought to crack down on because of perceived risks to the Chinese financial sector. Regulators are understood to have instructed China's state banks to suspend all new lending to the conglomerates' offshore acquisitions, such as Wanda-owned Legendary Entertainment and AMC Entertainment.