Published on July 16, 2005

Bt5-billion claim is largest of its kind

Picnic Corporation Plc yesterday filed a Bt5-billion lawsuit against Thawee Meengern, editor and publisher of Prachachart Turakit, the largest damages claim ever made against a Thai newspaper.

Picnic accused the newspaper of repeatedly defaming others and asked the Southern Bangkok Criminal Court to prohibit Thawee from engaging in journalism for five years, said Sukit Phoonsrikasem, Picnic’s lawyer.

The court will convene a preliminary hearing on Tuesday to decide if the case should proceed.

Meanwhile the Department of Special Investigation (DSI) has agreed to probe the accounting-fraud charge brought against current and former Picnic executives and associates by the Securities and Exchange Commission, Reuters said.

Theeratchanon and Supaporn Lapvisuthisin, siblings of former Deputy Commerce Minister Suriya Lapvisuthisin, are among the accused.

“At this stage we don’t know if this case will be prosecuted,” a source told the news agency.

Picnic shares reacted negatively to the news yesterday, shedding 12.74 per cent to end at Bt2.74.

In its lawsuit filed with the court, Picnic said Thawee and others had conspired to publish a negative report about Picnic in the July 11-13 edition of the newspaper.

The article was headlined “Picnic shares dumped: O/D account closed/Major shareholders spend billions to raise capital”.

Picnic quoted the newspaper article as saying: “Picnic has to raise capital by Bt2 billion. Its share price dwindled 292 per cent. Creditors Krung Thai Bank and Bank of Ayudhya terminated the O/D accounts. The Lapvisuthisins could need to spend a billion on the capital increase. Mutual funds expressed worries that small investors would shy away from the capital-increase shares.”

Picnic said the defendant had published false information and that Picnic had been covered unfairly in contravention of journalistic ethics. It said the report had led readers to believe that Picnic was financially weak and that financial statements had terminated overdrafts.

“The reporting could be summarised as saying it was not worth investing after considering the possible risks. It represented Picnic as not transparent,” the company said in a statement.

“We have never opened overdraft accounts with KTB or BAY. We have never had an overdraft.”

The company was also fuming over reports about the reluctance of existing shareholders to subscribe for new shares and the perceived lack of transparency in the company affecting the confidence of clients and business partners.

It said the reports had affected Picnic’s share price and caused Bt5 billion in damages.

“Since the defendant has committed similar offences in cases brought before this and other courts and is likely to do so repeatedly if allowed to remain in the profession, the plaintiff asks the court to bar the defendant from the profession of journalism for five years,” the suit said.

Picnic is represented by seven directors, Supaporn, Suwalee Sangkanchanavanich, Suphot Phatanasri, Watcharakiti Watcharothai, Wirach Pantumapol, Sompoch Intranukul and Prapas Rerkpibool.

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