Ding brothers contest Shanghai Citi Group Building ownership in Macau trial

Those who have been to Shanghai, and particularly the Bund, will remember a building on the other side of the river (Pudong), with a giant screen – The Citi Group Building.
However who would have thought that a dispute regarding the ownership of the building between its owners, the Ding brothers, would occur so far away in the Civil Court of Macau?
According to articles recently published by Ou-Mun Daily, the dispute between the Ding brothers indeed extends to Macau. Ding Yu and his elder sister, Ding Xiaohong, brought a civil action in Macau against their brother, Ding Gang and his ex-wife Su Xiaoping, requesting the court declare the nullity of their shares as well as their post in a company registered in Macau which indirectly owns the Citi Group Building in Shanghai. Both plaintiff and defendant claim they are the real owners of the building.
First, some background to the case. A local company, the Macau First Global International Company, is the holder of another entity, the Hong Kong First Continental Company. This HK corporation is the holder of the Shanghai Bading Company, the current owner of the Shanghai Citi Group Building.
Both Ding Yu and Ding Gang claim they are the real owners of the building.
Ding Yu and Ding Xiaohong had already lost a 3-year-long lawsuit in Hong Kong regarding the shares of the aforementioned Shanghai Company.
On the first day of the plaintiffs’ hearing, October 5th, Ding Yu’s legal advisor explained to the court that in the ’80s Ding got rich through the steel business and by selling TVs.
The mother of both the Ding siblings stated that Ding Xiaohong, also one of the plaintiffs, had been preventively detained in Shanghai since he became involved in a fraud case against his sister, Ding Gang, contesting her shares of the Shanghai company – the reason why she didn’t see her daughter for 2 years. The distressed mother hoped the parties could achieve an amicable settlement for the sake of family peace. When asked who the real investor in the building was, she answered Ding Yu. However, when asked how she knew this answer, she said she had been told by Yu.
The second hearing took place on October 16th with the witnesses for the defendant, Ou-Mun reported.
Mr. Sun, Vice President of the Shanghai Gao Qiao Company, stated that during 1994 to 1996, the national entity invested RMB7-8 million in a project under the Ding brothers’ company. The direct responsible of the project was Ding Yu; however, after some time, debts were run up and Yu disappeared. With the intention to recover the investment, the national company granted a RMB2 million loan to Ding Gang for the deposit of purchasing land where the present Citi Group Building stands. After a few years, the debt was totally reimbursed by Ding Gang.
Mr. Bao, accountant at the Ding brothers’ company since 1994, stated that Ding Yu had lost a lot of money in bad financial investments. Ding Gang was very unhappy that Ding Yu used the company’s name to request credit and stopped all his powers, appointing Su Xiaoping as financial controller instead.
The accountant said that Ding Yu’s investment debt rose to RMB8 million and was totally paid by Ding Gang. The Citi Group Building project was an investment by Ding Gang, who was the person who gave instructions, took decisions and signed papers. Ding Yu did not have any power in the company.
The third hearing took place on November 17th. A top executive of ICBC bank stated that in 2001 Ding Gang, representing Bading, requested a loan of RMB230 million to finance the Citi Group Building construction project, with a mortgage for the land reimbursable in 4 installments.
Mr. Tin stated that he witnessed the process and he was the one who suggested that that Ding Gang become simultaneous legal representative of both companies for business convenience.
The accountant of Hong Kong First Continental said that only she and Ding Xiaohong were working in the company. Although the plaintiffs are literal shareholders, during the 5 years, she only received instructions from Ding Gang and only saw Ding Yu four times. The latter had never intervened in any financial issue of the company.
She also said that the instructions were practically all executed by the witness.
In 2005 to 2006, Ding Gang gave instructions to transfer USD15 million of profit to Hong Kong First Continental and distribute it to the accounts of several companies as well as to the personal account of Ding Gang. The Hong Kong Company was held by Macau First Global, which belongs totally to Ding Gang. However, according to Macau Law, the company must qualify as “unipessoal” (sole ownership).  Ding Gang hasn’t given the reason why he invited Ding Xiaohong to hold 1% of the shares. However Ding Yu and Ding Xiaohong never shared in the company’s profits.
The final hearing will take place on November 24th. Staff reporter