[Focus] Coupang class action lawsuit: "Concealment of headquarters data is not possible... U.S. court can proceed with mandatory submission and restoration procedures"

- U.S. class action lawsuit, number of participants increased from 200 to 1,000 in one day
- Anyone who has placed an order can participate... In Korea, criminal proceedings are also carried out in parallel.
- U.S. class action lawsuit ‘opt-out’ method… Even non-participants in the lawsuit can receive compensation
- In the United States, punitive damages apply... It is difficult to predict the amount of compensation
- Key data such as emails and meeting minutes will be secured through ‘Discovery’
- Restoration when data is destroyed... Concealment or deletion can be punished for obstruction of justice
- If security investment was insufficient compared to the number of members, the head office ignored security.
- Possibility of US court dismissal? Depends on the size of the litigants and the participation of multinational victims
- The goal is to file a complaint within the year, but it may happen sooner.

■ Broadcast: MBC Radio Standard FM 95.9MHz (07:05~08:30)

■ Host: Kim Jong-bae, current affairs critic

■ Interview: Kim Kuk-il, CEO of Daeryun Law Firm (representing Coupang in a U.S. class action lawsuit)

☏ Host > A lawsuit is underway in the United States regarding the Coupang large-scale personal information leak incident. He held a press conference in New York yesterday and announced his plans for a lawsuit. I will connect you to the phone number of Daeryun Law Firm's Managing Director Kim Kuk-il. The CEO is with you, right?

☏ Kim Kuk-il > Yes, hello. This is Kuk-il Kim.

☏ Host > First of all, you said at a press conference yesterday that there are about 200 people who have announced that they will participate in the class action lawsuit. Has it increased more in the meantime?

☏ Kim Kook-il > Yes, I really feel the power of broadcasting. There were about 200 people at the press conference yesterday, but the number is already over 1,000.

☏ Host > Really?

☏ Kim Kuk-il > Yes.

☏ Host > However, during the press conference yesterday, the CEO said, ‘About 100 people have been entrusted with the task of filing criminal complaints and accusations.’ In addition to filing a claim for damages, will you also file a criminal complaint?

☏ Kim Kook-il > What we do in Korea is two areas: civil and criminal. In the past, when the SKT information leak occurred, I divided it into two areas: civil and criminal, but at that time, civil was the main part and detective was only a part. However, at Coupang this time, I divided the civil and criminal categories, and contrary to what I expected, almost half of the people applied for the criminal category as well.

☏ Host > So the detective work is conducted in Korea?

☏ Kim Kuk-il > Yes, that’s right.

☏ Host > So, can any Coupang member participate in this litigation group?

☏ Kim Kuk-il > Yes, that’s right. Anyone who has ordered at least one item from Coupang can participate.

☏ Host > But in the United States, there is a class action system, so even if you are not included in the group of litigants, if a judgment is made, isn't there a system where the contents of the judgment are applied equally? Does this have nothing to do with this this time?

☏ Kook-il Kim > Unless you waive a right you do not wish to have by opting out, you will receive compensation according to the ruling even if you were not the plaintiff.

☏ Host > Also in this lawsuit?

☏ Kim Kuk-il > Yes, that’s right. There is a difference in the amount of compensation between those who are merely plaintiffs and those who are not plaintiffs but are members.

☏ Host > There is a bit of a difference. However, you are saying that you can receive compensation.

☏ Kim Kuk-il > Yes, that’s right.

☏ Host > How much are you currently calculating for the compensation claim?

☏ Kim Kuk-il > You asked the most difficult question. Class action class action lawsuits in the United States have punitive implications. In Korea, it is called 1:1 compensation. All you have to do is prove what kind of damage there is and compensate for that damage.

☏ Host > That’s right.

☏ Kook-il Kim > However, punitive damages in the United States have the meaning of ‘punishment.’ When damage is caused by such intentionally, illegally, and anti-social corporate activities, not only compensation for the damage, but also compensation in the form of punitive retribution is required for the intentional or serious negligence that caused the damage. At the same time, compensation is added as a deterrent to prevent something like this from happening again in the future. So we cannot predict how much compensation will be awarded in class actions. Didn't I say that what I wanted most since I was doing Class Action was to work as an investigative agency in the U.S. and in civil and criminal roles in Korea? In the US, it's actually a class action civil service. We can utilize the discovery system in class action civil cases in the United States.

☏ Host > Are you talking about the system that forces submission of data?

☏ Kim Kuk-il > That’s right. It has the same meaning as a detective story conducted in Korea. Through Discovery, we can secure the emails, reporting materials, meeting materials exchanged between Coupang's headquarters and Coupang Korea, and then the decisions made by the board of directors at Coupang's headquarters. I expect that the contents will be more reliable than those revealed by investigative agencies through investigations in Korea, and that a large amount of unexpected contents will be revealed.

☏ Host > You mentioned it briefly a little while ago, so can we say that the data you are trying to secure through Discovery is mainly focused on, for example, data that can prove that the US headquarters was aware of lax security or how they responded after personal information was leaked?

☏ Kim Kuk-il > Yes, that’s right. To give a simple example, it is not completely confirmed, but didn't the Chinese security guard and the employee in charge of authentication take the authentication key with him when he left the company and used it to steal members' information over a long period of time? Could it be that the headquarters didn’t know about this lax security and information management? Regarding that, we just did what we have been doing for a long time. I believe that things such as making investments or making changes to a level of security that meets global standards were discussed within the board of directors and at Coupang headquarters. If it wasn't discussed at all, it would mean that security was ignored.

☏ Host > If you compare it to a public service society, it would be considered dereliction of duty, then?

☏ Kim Kuk-il > Yes, that’s right. If most of the country's members are 50 million, it can be said that 35 million are members. If the management of these members was really managed with a security system that manages thousands or tens of thousands of people, wouldn't that in itself be seen as a system worthy of social criticism? We would also like to secure whether there are any e-mails or other materials that contain such information, such as knowing this and knowing that an internal employee was stealing data from Coupang's headquarters because it was reported to them, but they did not act quickly and reported it with a reduced number of employees. Or, they knew that they were reducing the number of employees and reported it to the outside world, but only with a reduced number of employees.

☏ Host > If we are considering the possibility that data may have been destroyed or concealed, is it possible to track and confirm this as well?

☏ Kim Kuk-il > That’s right. There is a technology that can restore it without deleting it from the computerized data anyway, and if you conceal or destroy such data, you will be subject to appropriate punishment such as obstruction of justice.

☏ Host > Then, if a lawsuit is filed, can the discovery you mentioned be triggered immediately and demand the submission of data right away?

☏ Kim Kook-il > But even in Korea, where Class Action was created due to limitations such as the cost and human resources for multiple victims to file lawsuits, it is still only available individually, and Class Action has not been officially introduced, right? It's the same in America. This is a very, very special case and it is recognized as a multi-victim lawsuit, so the first thing that is accepted by the court is that it is recognized as a class action. Since it only happens in Korea because there are all victims in Korea, the U.S. court has no jurisdiction over this. Even if the claim is made, we cannot accept it, so the U.S. court can rule again like this.

☏ Host > How likely do you think that is?

☏ Kim Kook-il > I think the possibility depends on us continuing to collect victims.

☏ Host > Do you think it depends on the number of victims or the size of the litigants?

☏ Kim Kuk-il > I hope that multinational victims come forward along with the scale.

☏ Host > In other countries besides Korea?

☏ Kim Kuk-il > That’s right. In particular, aren't there also Koreans in the U.S.? There are quite a few people like this who are also members of Coupang in Korea. When these people file a lawsuit together with Korean citizens, even in the U.S. courts, this is not just Korea's problem.

☏ Host > That’s right.

☏ Kook-il Kim > Just looking at the manuscript makes it difficult to reject it. This is important to us and that is why we held a press conference yesterday. We hope that many people, especially those in the United States, will participate. I held this press conference to appeal that.

☏ Host > That’s the key in the end. If you look at it that way.

☏ Kim Kuk-il > Yes, that’s right. If you pass that hurdle, we will start a lawsuit in court and present evidence and supporting materials for both sides. Of course, Coupang headquarters will only produce what is in its favor, right? Then, we apply for discovery and the court says yes, please check everything, and this is how the process goes.

☏ Host > This lawsuit is being filed primarily by consumers and members, but isn't it possible for shareholders or investors to file lawsuits as well?

☏ Kim Kuk-il > That’s right. In this case alone, I think an investor lawsuit is possible because reporting, reporting, and notification were delayed, and there were violations of disclosure obligations, but since Coupang member users and consumers suffered the most damage, we are trying to focus here first.

☏ Host > Then, when do you expect to file a complaint?

☏ Kim Kook-il > Since so many people have responded positively, we are discussing internally whether we should actually go a little faster than expected. Originally, I was planning to file it somehow within the year, but I'm expecting that it might happen sooner.

☏ Host > You can't just cut a radish with a knife, so you initially thought that the standard was around 1,000 people?

☏ Kim Kuk-il > Yes, that’s right.

☏ Host > But the number of people exceeded 1,000 overnight.

☏ Kook-il Kim > Yes, that’s right.

☏ Host > Then, you can file a complaint right away.

☏ Kim Kook-il > Today, while I was having a morning meeting, I was in New York, and when I was meeting with American lawyers, my first estimate was that SKT, which we are still working on, would have about 1,000 people, but it fell short of that. Nevertheless, we proceeded because we had a deadline, and in the case of Coupang, of course, we expected SKT and set it at 1,000 people, but it surpassed the number in one day, so you can see how the people are so angry about Coupang that they cannot resolve it. So, at this morning's meeting, we just said, let's just take 10,000 people.

☏ Host > Okay. Lastly, I would like to ask this question. It is about the speed of litigation. If the Korean government's investigation results are officially announced and fines are imposed on them, will the speed of litigation in the United States speed up, and what will happen?

☏ Kim Kuk-il > That’s right. Wasn't the reason we filed a civil and criminal complaint, especially a search and seizure in the criminal case?

☏ Host > That’s right.

☏ Kim Kook-il > If the process of the leak through the search and seizure, who leaked it, how this friend leaked it, what preparations were made at the company level for it, and whether the company knew about it even after it was leaked and then covered it up again, if these things come out through the investigation, wouldn't there not be a lot of information to check even if we apply for discovery?

☏ Host > That’s right. That's right.

☏ Kim Kuk-il > Rather, the reason for proceeding with both Korea and the United States is that there is an advantage in being able to use the data obtained from one side for the other side.

☏ Host > Yes, I understand. I think we should listen to today's words up to this point. There are probably many people who are watching the litigation progress. Thank you. Representative.

☏ Kook-il Kim > Yes, thank you.

☏ Host > We were with Kim Kuk-il, CEO of Daeryun Law Firm.

[View full article]
[Focus] Coupang class action lawsuit "Concealment of headquarters data is impossible... U.S. court may proceed with mandatory submission and restoration procedures" (Go)