News / CSG subsidiaries sue forwarder EV Cargo over unpaid invoices

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Relations between Hong Kong’s Cargo Services Group (CSG) and forwarder EV Cargo have hit a new low, with a second lawsuit against EV and its private equity owner.

This morning, CSG subsidiaries Cargo Services Far East and CS International said they were suing EV Cargo Global Forwarding and EmergeVest over unpaid invoices.

CSG has demanded $1.7m (HK$13.2m) in a writ filed with the high court in Hong Kong, to cover “outstanding payment and contractual interest for freight forwarding and shipping services”.

The claim follows another lawsuit for EmergeVest at the end of June, when CSG founder John Lau Shek Yau took legal action against Heath Zarin, founder of EmergeVest and EV Cornerstone and a director of EV Cargo Global Forwarding. Mr Lau is demanding the return of $45m he invested in EmergeVest Logistics Fund.

Mr Lau said at the time that, without his backing, there would have been no EmergeVest. He said he would divest completely from EV Cargo and the fund over its strategy to compete with CSG in China. He said: “It does not make any commercial sense for me to continue with our investment in EV Cargo whose strategy is to compete with our business in China.”

Mr Lau is also considering selling the two subsidiaries, worth about $1bn, because of their stakes in EV Cargo.

“I am prepared to pursue this legal path until my rights are vindicated,” he added. “As the Chinese saying goes, ‘when you drink the water, remember the spring is the source of the water’.”

A spokesperson for EmergeVest told The Loadstar: “We do not comment on ongoing litigation.  As always, we remain committed to executing our successful strategy, driving value creation for EmergeVest investors and EV Cargo stakeholders.”

EV Cargo declined to comment when contacted by The Loadstar.