The maker of cameras and medical equipment with a 92-year history filed lawsuits on Sunday at the Tokyo District Court against six current board members. Former president Tsuyoshi Kikukawa, vice president Hisashi Mori and former auditor Hideo Yamada have been called upon to pay compensation.

In the wake of Olympus’ latest announcement, shares in the company surged on Tuesday. Shares closed at 1,263, almost 20 per cent more than on Monday. A trader at Osaka Securities Exchange, Mr. Shibata, reflected that "Olympus shares plummeted by as much as 40 per cent right after the scandal came to light last October." Although so far nobody can be sure whether Olympus will be delisted from the stock market, some investors clearly believe that things are looking up at the company. Mr Shibata points out that "we notice that the products of Olympus ranging from camera to medical equipment have become very cheap, despite its high technology and high-quality."

The scandal first erupted when the British CEO Michael Woodford, the company’s first non-Japanese president, informed journalists about suspicious acquisition deals after he was dismissed. For instance, Olympus purchased the British medical-instruments company Gyrus in 2008 for US$2 billion and paid US$687 million to an financial adviser based in the Cayman Islands.

Japanese, British and US authorities have probed the "Olympus affair" in some depth. Olympus has meanwhile admitted that it used over-priced acquisition and consultant fees to hide losses, which account for at least 134.9 billion yen.

Akihiro Miyazawa, a marketing executive at Olympus' rival Fujifilm said he had been surprised by the scandal. "It was an enormous company with a good reputation," he told Deutsche Welle. "The digital products in our company may outstrip Olympus but I have to admit that their medical equipment, in particular their endoscope, is top in Japan."

Miyazawa nevertheless acknowledges that his company has benefitted from the Olympus scandal because he expects shares to rise in the medical sector of Fujifilm. "I don’t think it (Olympus) will be delisted though. In my opinion, our company or others could take it over in the near future."

The scandal has not only tarnished the reputation of a long-established company but has also triggered calls for the reform of regulating Japan’s corporate sector.

Author: Miriam Wong
Editor: Grahame Lucas