Winning a lawsuit seeking a real estate brokerage commission on an M&A transaction

The client, a company, completed a mergers and acquisitions (M&A) transaction by acquiring the shares of another company. A real estate broker then filed a lawsuit claiming a real estate brokerage commission, arguing that the transaction was in substance a real estate transaction and that the broker had contributed to closing the deal.

Attorney Jaehoon Lee represented the client in the litigation.

The core issue was whether an M&A transaction carried out through a share purchase agreement was in substance a real estate transaction, and whether a real estate broker could be entitled to a brokerage commission for it.

Other issues were whether the broker had played a decisive role in actually closing the transaction, and whether there had been any brokerage engagement or agreement to pay a commission between the client and the broker.

Attorney Lee emphasized that the contract actually signed was not a sale of the real estate itself but an M&A transaction to acquire management control by purchasing the shares of the target company, and contested the plaintiff's claims by analyzing in detail the legal nature of and differences between the two types of transactions.

Based on the relevant contract documents and the course of the transaction, he also argued that the client had never engaged the broker or agreed to pay a commission, and that the broker had not played a decisive role in the signing of the share purchase agreement.

The court dismissed all of the plaintiff's claims, and the client was not required to pay any real estate brokerage commission.