The Democratic Party of Korea is pushing to expand the class action system into the personal data and consumer goods sectors, taking direct aim at Coupang after a massive personal data breach. With controversy growing over Coupang's posture during the response—such as Kim Beom-suk, Coupang Inc. board chair, not appearing at a National Assembly hearing—voices within the ruling party are getting louder that a tool is needed to sanction Coupang.
Oh Ki-hyeong, a Democratic Party lawmaker, on the 6th introduced a "class action bill" to widen the scope of class actions to personal data and consumer goods. The class action system allows the result of a suit filed by a particular representative to apply to other victims who suffered the same harm. Korea adopted a class action system in 2005, but it is limited to the securities field, such as false disclosures by listed companies.
The core of the bill is to broaden the class action system, currently limited to the securities field, to general torts such as personal data leaks and consumer disputes. The bill specifies that an organization authorized by at least 50 victims can file a suit to confirm liability against corporations. If a representative of a class action receives an improper solicitation in connection with official duties, the person would face a fine of up to 100 million won or life imprisonment or at least 10 years in prison.
Within the Democratic Party, discussion of the class action system is gaining momentum. On Dec. 31, Kim Nam-geun, the party's deputy floor leader, introduced a class action bill allowing an organization authorized by at least 100 victims to file a suit to confirm liability against large corporations. If an illegal act by corporations or a delay in compensation occurs, the bill would impose punitive damages of up to five times. In addition, Democratic Party lawmakers Baek Hye-ryeon, Park Ju-min, Jeon Yong-gi, and Lee Hak-young have introduced bills related to the class action system.
Fueling the rapid progress of the class action debate is an underlying "anti-Coupang" sentiment. When Coupang consistently stuck to a so-called "holdout strategy," such as sending only Harold Rogers, Coupang Korea's representative, in place of Chair Kim Beom-suk to the National Assembly joint hearing held on the 30th–31st of last month, a mood formed within the Democratic Party that practical sanctions were needed.
Within the Democratic Party, some argue the class action system should be applied retroactively to the Coupang personal data leak. They say retroactive application is possible because the class action bill falls under a "procedural law" that changes how the right to file a suit is exercised.
Oh Ki-hyeong said, "The reason Coupang is arrogant is that it thinks even if a personal data leak occurs, no major disadvantages will follow or the situation can be smoothed over with little money," adding, "There is already significant consensus within the party on the class action system, and if we apply it retroactively to Coupang, a stronger mood will take hold among corporations to prevent consumer harm in advance."