Horie was arrested by Tokyo district public prosecutors on January 23, and on January 24, he announced his resignation as CEO. On April 27, 2006, he was released on ¥300 million bail on the condition that he refrain from any contact with Livedoor or its employees. Horie said he would not participate in the company's management again. Though indicted on charges of fabricating financial reports and spreading false information to investors, he continued to assert his innocence. His trial for securities fraud began on September 4, 2006. Prosecutors sought a four-year prison sentence for Horie, who pleaded not guilty. In March 2007, he was found guilty of falsifying the company's accounts and misleading investors and was sentenced to 2 years and 6 months imprisonment. He appealed the punishment, but the Supreme Court of Japan on April 26, 2011 upheld the sentence.