Chapter 1: Xu Mo Sues Liao Zhijie
In April 2017, Chase Liu arrived in City A from Hong Kong. Starting from the international youth hostel in Laoximen, he followed the map on his phone, first riding a shared bike, then switching subway lines several times until he reached the southern suburban university town. After exiting the station, he hailed an orange regional taxi. He showed the driver a WeChat chat screenshot with the address: “Between No. 1258 and No. 1300 on Nansong Highway, look for a river, turn right, and walk inward along four willow trees.” The driver, a local middle-aged man, scratched his head and chuckled. “I’ve been driving here for over twenty years, but this is the first time I’ve seen an address like this.” Chase also laughed, replying in broken Mandarin, “It’s my first time here too.” The driver barely understood him and didn’t bother engaging further, shaking his head with a toothpick in his mouth as he started the engine. The scenery outside the window shifted—schools, parks, film studios. Miniature replicas of the Great World, the Park Hotel, and the custom house clock tower flickered past the plane treetops, while extras sat eating noodles at roadside shops. Soon, the view opened onto a highway flanked by villages and farmland. No. 1258 appeared, and shortly after, there was indeed a river. Chase paid the fare, got out, and walked inward along the willows, only for the path to grow narrower until a wall blocked his way. Puzzled, he stood there, pulled out his phone, and made a call. Nervously, he uttered the line he had rehearsed for a long time: “Hello, this is Chase. I have an appointment with Teacher Shimizu today…” He hesitated, trying to figure out how to phrase the second half—maybe the address was wrong. Before he could translate his Cantonese thoughts into Mandarin, the voice on the other end replied, “You’re on the wrong side. It’s the four willow trees, not three.” Chase suddenly realized his mistake. He looked up, counting the weeping willows by the river—three. He had gone the wrong way. Across the river, near four trees, a metal door swung open. A figure stood there, wearing a dust mask and a disposable raincoat speckled with wood shavings and paint splatters. From that distance, their face was indistinct. But Chase knew—this was “Shimizu.” He had seen her work online and discussed collaboration with her. Only now did he realize she was a woman. Separated by the narrow river, he waved at her, and she waved back. That was Chase’s first encounter with Xu Mo. As for Qi Song, he met Guan Lan because of a case. A client brought in by the M&A team had initially been handled by another lawyer from the dispute resolution group—until it turned into a mess, and then they turned to Qi Song. “Divorce? Can’t do it,” Qi Song declined politely after hearing the gist. “Not a divorce,” corrected Jiang Yuan, the M&A group’s partner, over the phone…

April 2017, Liao Zhijie arrived in City A from Hong Kong.

He set out from the international youth hostel at Old Town West Gate, following the map on his phone—first riding a shared bicycle, then transferring through several subway lines until reaching the southern university town. After exiting the station, he boarded an orange shuttle taxi.

He showed the driver a screenshot of a WeChat conversation with an address: Between No. 1258 and No. 1300 on Nansong Highway, turn right when you see a river, then walk inward along four large willow trees.

The driver, a local middle-aged man, scratched his head and chuckled: “I’ve been driving here for over twenty years, but this is the first time I’ve seen an address like this.”

Liao Zhijie also laughed, replying in heavily accented Mandarin: “It’s my first time coming here too.”

The driver only half-understood and couldn’t be bothered to continue the conversation. Clenching a toothpick between his teeth, he shook his head and started the engine.

The car moved forward, the scenery outside the window changing—schools, parks, a film studio. Miniature versions of the Great World, the International Hotel, and the customs clock tower flickered among the plane trees, while extras sat in roadside shops eating noodles. Then came open highways, flanked only by villages and farmland.

Arriving at No. 1258, there was indeed a river not far beyond. Liao Zhijie paid the fare, got out, and walked along the willow trees, only for the path to grow narrower until it ended abruptly at a wall with no way forward.

Puzzled, he stood there, pulled out his phone, and dialed the number. As the call connected, he nervously uttered the line he’d rehearsed for so long: “Hello, this is Chase. I’m here for my appointment with Teacher Shimizu today…”

Then he hesitated, trying to figure out how to phrase the next part—but something about this address didn’t seem quite right.

Before he could translate Cantonese into Mandarin, the other side had already responded: “You’re at the wrong place. It’s the side with four big willow trees, not three.”

Liao Zhijie suddenly understood. He looked up at the weeping willows by the riverside and counted—sure enough, there were only three. He had gone the wrong way.

Turning his gaze toward the opposite bank with four trees, he saw a metal door swing open. A person stood there wearing a dust mask, clad in a disposable raincoat covered with wood shavings and splattered paint.

From this distance, he couldn’t make out their features. But Liao Zhijie knew—this was “Qingshui.” He had seen her work online and discussed collaborations with her. Only now did he realize she was a woman.

Across the small river, he waved at her, and she waved back.

This was Liao Zhizhe’s first encounter with Xu Mo.

Qi Song knew Guan Lan through a case.

A client brought in by the M&A group. Initially, another lawyer from the dispute resolution team handled the negotiations, until they couldn’t manage it anymore—that’s when they turned to Qi Song.

“Divorce? Won’t handle it.” Qi Song got the general idea and politely declined.

“Not a divorce,” explained Jiang Yuan, the M&A partner, over the phone. “They split a long time ago. There’s just some dispute over company shares.”

“Which means they didn’t cleanly separate, right?” Qi Song stuck to his position. “Still won’t handle it.”

“Come on,” Jiang Yuan persuaded. “The junior in your group is already working on it, all the materials are ready. Just weigh in—see if we should mediate or wait for trial. It’s no trouble at all.”

Qi Song explained to him: “Ex-wife and ex-husband, failed negotiations leading to litigation. These kinds of relationships usually result in spite-driven lawsuits. Unrealistic expectations, unwillingness to listen during the process, and then blaming the lawyer when they lose—what kind of masochist would willingly get involved with that?”

“You claim you never handle divorces, yet you seem pretty well-versed,” Jiang Yuan laughed, then added, “This case was mentioned by Lawyer Zhu and Lawyer Wang. Lawyer Wang said to bring it directly to you.”

The two individuals he mentioned were both members of the management committee at Zhizheng Law Firm. Zhu Fengran was a senior partner in the M&A and capital markets group, while Wang Gan headed dispute resolution, overseeing both arbitration and litigation—effectively Qi Song’s direct superior.

Qi Song fell silent and sighed.

Jiang Yuan was still laughing over there.

Qi Song had already gotten back to business and asked directly, “What needs to be done?”

“This time we must make sure the ‘divorce’ is completely settled,” Jiang Yuan borrowed his earlier phrasing, adding another requirement, “as quickly as possible.”

“Is this the client’s wish, or your firm’s?” Qi Song asked half-jokingly.

Jiang Yuan evaded the question, saying, ‘Hey, you…’

“Alright,” Qi Song understood immediately and cut in, “I know now.”

This kind of cleaning-up mess wasn’t new to him. Sometimes it needed to be done quickly, sometimes slowly. The outcome of litigation wasn’t the only goal—the process itself mattered more. These were the words Wang Gan had told him when he first entered the profession.

That same day, he sought out the lawyer handling the case, Yang Jiayue, and reviewed the details. Just as Qi Song had anticipated, the divorce hadn’t been properly finalized.

The party concerned, Liao Zhijie, also known as Chase Liao, was born in Hong Kong, China, and holds a Canadian passport. Several years ago, he came to City A to start a business and fell in love with his business partner, Xu Mo. The couple eventually married and together operated an animation studio named “Qing Shui Cuo Luo” (Clear Water, Scattered Drops). As their business gradually expanded, the studio grew in scale, adopting a VIE structure, and establishing a holding company in the Cayman Islands, a British Overseas Territory.

They agreed to divorce last year. With no children involved, assets were to be divided separately, yet neither was willing to relinquish “Qing Shui Cuo Luo.” Thus, the equity remained unchanged—Liao retained 51%, and Xu held 49%, marking an amicable and respectable separation.

Shortly after the divorce was finalized, Liao, acting as the controlling shareholder, signed a contract on behalf of the company, selling all shares for 5 million RMB (approximately 700,000 USD).

With the completion of this transaction, Xu was effectively forced out. According to her equity stake, she was entitled to less than half of the proceeds—close to 2.5 million RMB (around 350,000 USD).

Xu believed the share value was severely undervalued, and this transaction clearly harmed her interests. When negotiations between them failed, Xu told Liao, “See you in court.”

“Who were the shares sold to?” Qi Song asked.

Yang Jiayue replied, “The transferee was also a Cayman company with only one shareholder—Liao himself.”

Having seen this scenario countless times before, Qi Song simply remarked, “After the 2020 amendment, Cayman companies are no longer black boxes. The registry can verify all registered enterprises’ directors and executives—Xu Mo must have already obtained this information.”

Yang Jiayue nodded. Jiang Yuan thought he wasn’t capable of handling this case and brought in Qi Song to oversee it, but he didn’t share that view himself, feeling somewhat defensive about it.

Cut-rate deals, self-dealing, spending a paltry sum to buy out an ex-wife, appropriating the fruits of joint entrepreneurship. To the average person, it would all sound like irrefutable evidence, an outrage to gods and men alike. But from a lawyer’s legal perspective, it’s an entirely different story.

For example, Yang Jiayue—after Qi Song—was the new generation’s undisputed workaholic king in the dispute resolution group. Having studied in the UK and graduated from a prestigious university, he held legal qualifications not just in mainland China, but also licenses from Hong Kong, England, and even the US state of California. Within the team, he specialized exclusively in cases involving foreign elements.

Long before the other party officially filed the lawsuit, he had conducted thorough legal research, listing all possible litigation strategies the plaintiff might employ. Now, he wrote each one on the glass whiteboard in the conference room and explained them to Qi Song:

“This case won’t work under Chinese Company Law. In shareholder derivative lawsuits, the compensation goes to the company. Even if Xu Mo wins, the damages would be paid by Liao to ‘Qingshui Cuoluo,’ which is an offshore company entirely controlled by Liao. This would then lead to issues regarding the distribution and enforcement of the compensation—one lawsuit after another, and Xu would end up with nothing.”

“If Xu files a lawsuit in the Cayman Islands court, citing Article 46 on shareholders’ repurchase rights, Article 62 on preemptive rights, and Article 175, which requires a shareholders’ resolution for disposing of over 50% of the assets, the case still won’t succeed.”

“Because when Qingshui established the Cayman company, Liao was the registrant. He drafted the company’s articles of association, which explicitly excluded these rights and included exemption clauses for connected transactions and conflicts of interest. So, this self-dealing transaction is actually legal under Cayman law and cannot be revoked.”

Although the timeline on the whiteboard was clearly laid out, Qi Song still flipped through the materials upon hearing this. It was 2019, just over a year after the two had gotten married. As he had mentioned earlier, the amendments to the Cayman Islands Company Law had not yet been introduced at that time, and there was no requirement to disclose the company’s structure at the registry. Unless a lawsuit was filed, it was difficult to verify the shareholders, directors, and ultimate beneficial owners. Liao had likely already made plans and left himself an escape route back then.

Yang Jiayue saw his meaning and joked, “The wife fully entrusted it to him to handle, probably because the newlywed couple was still in that honeymoon phase…”

Love.

Qi Song didn’t comment, only reminding: “There’s also the unfair prejudice claim.”

“Right, Cayman Islands Law Section 184I,” Yang Jiayue continued, “This angle might work, but the litigation costs would be extremely high. According to Mr. Liao, Xu Mo’s financial situation wasn’t great after the divorce—she can’t afford Cayman lawyers’ fees.”

Qi Song said, “She can file the lawsuit in China, but Cayman Islands law would apply.”

Yang Jiayue nodded in agreement, confirming that he hadn’t overlooked this point: “Xu really only has this one viable option. However, there are very few precedents for such an approach, making the legal proceedings quite challenging. Moreover, I’ve looked into the opposing lawyer…”

“Who is it?” Qi Song asked.

“Xu Mo found an agent recommended by a friend—a woman who was a lecturer at a political and law university. She held a part-time lawyer position at a small firm, and a quick search under her name in the court judgment database yielded only a handful of records, all related to domestic cases like alimony, inheritance, or property division.”

The implication was that she had no team, let alone any experience in international commercial litigation.

Qi Song felt slightly uneasy and asked, “What were you planning to do at that time?”

Yang Jiayue replied, “I was going to first assess the situation with Xu Mo’s case filing before scheduling a second round of negotiations.”

Qi Song then asked, “What did Mr. Liao say about it?”

“Mr. Liao has agreed, but he’s also made a request. When it comes to settlement negotiations, the amount should still be discussed at 2.5 million, with a ceiling not exceeding 3 million.”

Qi Song listened to him, then chuckled softly.

The phrase “see you in court” had been uttered, but in reality there was no guarantee the case would even be accepted for filing. These were the words Yang Jiayue never actually voiced but surely must have thought, leading to his overly optimistic client communications that later complicated settlement negotiations. Liao Zhijie was likely thinking the same – if the opposing side had such weak standing, why were you making things so difficult?

The reality turned out to be beyond Yang Jiayue’s expectations—it took less than two weeks before the court sent over the indictment, and the case was officially filed.

The opposing party similarly eliminated all dead ends, precisely identifying the only viable entry point—filing the lawsuit in China under Cayman Islands company law. They argued that Liao Zhijie had transferred shares at an unreasonably low price to a company wholly owned by himself, thereby violating the statutory duties of directors to act in good faith, with integrity, and to exercise their powers for the proper purpose of maximizing corporate interests. Subjectively, Liao acted with malice, and objectively, Xu Mo suffered unfair prejudice as a result. On these grounds, they demanded Liao compensate Xu for economic losses amounting to 21 million yuan.

Yang Jiayue found himself outmaneuvered, yet he still believed the other side was merely playing psychological games—their aim being to push Liao’s camp into proposing a settlement first before stating their conditions. The enormous gap between the 21 million claim and 2.5 million suggested they were clearly positioning themselves for negotiation.

He advised Mr. Liao to remain patient and filed a statement of defense on behalf of the defendant, contending that Liao had conducted an asset valuation before proceeding with the transaction. The 5 million yuan price tag was based on valuations from professional reports, and thus no so-called unfair prejudice existed.

What followed was a month-long evidence exchange period, during which both parties submitted their proofs, and the litigation process advanced step by step.

Once again, to Yang Jiayue’s surprise, the other party did not propose a settlement but successfully applied for an exit ban and asset preservation.

Liao Zhijie had work commitments and needed to return to Hong Kong regularly, so he finally took a step back and offered to initiate negotiations, proposing a settlement of 5 million yuan. Coincidentally, the court scheduled a pre-trial conference to arrange a meeting between the two parties, both to gain a deeper understanding of the case and to discuss the possibility of a settlement. However, if this meeting failed, it would indeed lead to a court battle. The mergers and acquisitions team felt the situation was somewhat unfavorable, which was why Jiang Yuan sought out Qi Song at this point.

The conference was scheduled for the very next day. Liao Zhijie would not be present in person, and Qi Song did not have time to meet with him. After reviewing the materials, Qi Song confirmed with Yang Jiayue: “That asset valuation report is the key evidence. Have you discussed it thoroughly with the client?”

“I’ve read the entire report. It was issued by one of the Big Four, and I’ve confirmed it with the signing appraiser. There are no issues,” Yang Jiayue stated confidently. “If Xu has objections to the results, she can certainly apply to the court for a re-evaluation. However, ‘Qingshui Cuoluo’ is not a traditional production and sales enterprise with tangible assets like factories, machinery, showrooms, or inventory that can be easily valued. Moreover, precisely because of this shareholder dispute, the company’s operational status has undergone significant changes over the past few months—the team has disbanded, contracts have been breached, and the animated series has been discontinued on several platforms. Even if a re-evaluation were conducted now, it would be impossible to arrive at a figure that supports her claim.”

The situation itself is bullshit, but the wording isn’t wrong. Terms like goodwill, honesty, best interests, and reasonable purpose are all open to interpretation—not objective facts. You say his actions were unreasonable? How would you prove that? You claim to have lost 21 million? How would you substantiate that?

Every time he encountered situations like this, Qi Song became acutely aware that he was a lawyer. Fairness doesn’t exist; there are only rules—rules that can be exploited.

He didn’t say anything more, dismissing Yang Jiayue before going through the materials again, eventually returning to that copy of the complaint.

At the end, the plaintiff’s signature was written in neat, delicate characters: Guan Lan. It looked like the handwriting of the good student every class had back in school—smart, but by the book.

He found himself somewhat curious about how this part-time female lawyer—licensed at a small firm and specializing in family law cases—would handle the situation