Supreme Court of Korea Ruled Music DRM Does Not Violate Competition Law – Abuse of Dominant Market Position in Mobile Phone and Music Download Service

February 18, 2012

There have been ongoing disputes as to whether Digital Rights Management(DRM) does violate competition law.  By using a DRM, the company can tie the playback of certain digital files to its own IT device.  The problem arises when the company has a dominant market position, because it entails an argument from competitors that the company has abused its dominant market position to distort a free competition at the market.

In November last year, the Supreme Court of Korea firstly issued a ruling addressing this issue.  The case dates back to 2006, when Fair Trade Commission(FTC) of South Korea ordered SK Telecom, the largest mobile carrier company and music download service provider, to lift up a DRM which had prevented the purchasers of MP3 mobile phone of SK Telecom from playing MP3 files downloaded from other online music store than SK Telecom’s online music store.  SK Telecom had appealed the FTC’s decision to the court.

At the heart of this lawsuit is whether SK Telecom’s use of DRM does constitute an abuse of its dominant market position under Korean Competition law.  In this regard, the Monopoly Regulation and Fair Trade Act(MRFTA) of Korea provides that any market dominant enterpriser shall not commit an act of either (i) unreasonably interfering with the business activities of other enterprisers or (ii) unreasonably doing considerable harm to the interests of consumers.  The FTC found SK Telecom’s using a DRM Read the rest of this entry »


Apple’s Korean Office Paid Compensation to a South Korean User for iPhone Location Tracking – So Does This Mean Korean Court Made an End to the Legal Fight?

July 15, 2011

It was reported that last month Apple’s South Korean office paid $945 of compensation to a South Korean iPhone user for the breaching of privacy by the controversial iPhone user location tracking.  Here is the detail from Reuters.

By the way, some news providers reported that this was the ruling from a Korean district court.  I, as a Korean lawyer, think that statement is half right and half wrong.  Basically it is true that the court issued a ruling which ordered the Apple Korea to pay $945 to the user.  But this was not the formal trial case, but a Request for a Payment Order case.  Payment order is much convenient & simplified legal procedures for claimant to get a judgment from the court compared to a formal lawsuit.  Once a request filed, the Korean court does not question the debtor (in this case, the Apple Korea) and issue a Payment Order within 2 or 4 weeks (in certain courts, within a few days). This payment order, a sort of ruling, asks the opposing party to choose whether to admit the claim as written on the request or to make an objection.  If no objection has been raised from the opposing party within 2 weeks, then Read the rest of this entry »


Seoul Court Ruled Uploading a 15-Second Video of Toddler’s Dancing to a Famous Singer’s Song Is Not a Copyright Infringement and the Copyright Holder Who Sent an Unfair Take Down Notice Should Pay a Monetary Compensation

October 5, 2010

There have been increasing conflicts between the free expression and the copyright arising out of a UCC, a user-created content, posted on the internet site.  For example, in the United States, there was a legal dispute concerning a woman’s 29-second YouTube video of her toddler dancing to Prince’s “Let’s Go Crazy”. Copyright holder to the Prince’s song alleged the video infringed the song’s copyright.

Almost the same lawsuit had been filed in South Korea. In Korea, a father uploaded to his blog operated by Naver, the largest internet portal site, a video capturing his 5 year-old daughter singing and dancing to a famous Korean female singer(Dambi Sohn)’s song, titled “Crazy”. But the video was taken down by the portal site operator upon a request from the copyright holder to the song alleging the video is a copyright infringement as it was used the song without permission. Then the father filed both a declaratory lawsuit that uploading the video did not constitute a copyright infringement and a monetary compensation lawsuit for mental damages which he suffered from the take down of the video he’d made.

On February 18, 2010, the Seoul Southern District Court sided with the father. The court ruled that uploading a video at issue did not constitute a copyright infringement because it fell within the scope of “the quotation from works made public” under Article 28 of the Copyright Act, which Read the rest of this entry »


Can a Game Character Itself be Protected as a Copyrighted Work Separated from Its Original Work?

June 22, 2010

This is an issue arising from an international IP dispute between Konami, a well-known Japanese game production company, and Neople, a Korean game production company.  Back in 2007, Konami alleged that game characters in Neople’s game titled “Shin-Ya-Gu”(New baseball) infringed Konami’s copyright in its famous baseball game “Jikkyou Yaku”(see the picture.  the left image is Konami’s character and the right one is Neople’s) and filed a copyright infringement lawsuit to a Korean court.

The lower courts had overruled Konami’s claim stating a game character itself could not be protected as a copyrighted work under Korean copyright law unless such character had been commercialized independently.

However this year the Supreme Court of Korea dissented from the lower courts’ opinion.  The Supreme Court ruled a game character can be copyrighted separated from its original work, a game.  The court held that “In order to be protected under the copyright law, a work must be a creative work expressing human thoughts or emotions. Thus, in case of a character implying shape and name of person, animal and so on appearing in cartoon, television, movie, newspaper, magazine and so on, if the creative personality was shown in the visual expression as to the appearance, action of such person, animal, then such character can be a work as protected under the copyright law, apart from its original work”.  Then the Supreme Court continued to held that  Read the rest of this entry »


RAIN & JYP Ordered to Pay $8 Million to Hawaiian Concert Promoter – Glimpse on Legal Issues in Korean Music Business, What Is Wrong with That?

March 26, 2009

eab7b8eba6bc-111South Korean popstar RAIN (Chung, Ji-hoon) and his ex-agency JYP Entertainment had lost their lawsuit in Hawaiian District Court brought by a local promoter, Click Entertainment, alleging Rain’s last-minute cancellation of Honolulu concert in 2007 cost them $1.5 million and caused damage to the company’s reputation.

A couple of days ago, the court found in Click’s favour, ruling that Rain and JYP were guilty of both breach of contract and fraud.  Nearly $5 million of the damages payment are punitive, with Rain himself and JYP ordered to pay half each.

It is reported that Rain has testified he didn’t know why the concert had been cancelled and the cancellation was out of his control.

I think many people, especially outside of Korea, wonder how the singer, the performer himself, couldn’t know the reason of the cancellation and how he could say it was “out of his control”.  In this regard, I think people should know more about Korean music business to understand Rain’s comment.

In Korea, almost every singers and bands are under exclusive contracts with certain entertainment entrepreneurs, called “Ghi-Hoek-Sa”, which is the mixture of agencies and management companies, yes, they’re doing both of jobs in Korea.  The problem is the contract between the singers and the entrepreneur is being criticized as very unfavorable to the singers.  For example, the term of the contract is very long, Read the rest of this entry »


Fund Buyers Keep Filing Lawsuits against Fund-Sellers Alleging So-called “Irresponsible Sale”

March 19, 2009

Recently there can be seen so many lawsuits are being filed against domestic banks with regard to the bank’s irresponsible fund sale.  The Korean fund buyers are alleging the losses in the funds which are still on-going were caused by the fund-sellers’ not informing sufficient information on the risk and possibilities of losses when they put the money to the funds.

As a matter of law, Korean court has ruled that the banks are obliged to inform the customer of the structure of the investment such as fund or option transaction and the risk of possible losses sufficiently when they solicit the customers for investments.  If they neglect that obligation, it constitutes a breach of contract and Read the rest of this entry »


Two Korean Internet Portal Giants Prosecuted for Aiding Copyright Infringement

December 29, 2008

naverLast December 23, the Seoul Central Prosecutors’ Office prosecuted NHN corporation, the operator of Naver (the largest Internet portal in Korea) and Daum Communications Co., the operatot of Daum for copyright infringement.

The prosecutors said two Internet portals have been aiding copyright infringement of their users by ignoring copyright holders(The Korea Music Copyright Association and the Korea Association of Phonogram Producers) request for removing illegal music files on their sites and taking no actions.  The prosecutors found 10 millions of uploaded music files Read the rest of this entry »


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