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

There have been 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 that SK Telecom does not operate.  SK Telecom had appealed the FTC’s decision to the court.

At the heart of this lawsuit lies the issue of 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 Continue reading


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Seoul Court Ruled Jin-Young Park, Famous Korean Song Writer and Producer, Is Guilty of Plagiarism – Korean Copyright Law on Music Plagiarism and Copyright Infringement

On February 10, Seoul Central District Court ruled that Mr. Jin-Young Park, one of the most influential music producers and composers, had plagiarized another Korean composer’s song.  The defendant Mr. Park is well-known as the co-owner of JYP Entertainment, one of the top Korean music production companies(Gi-Huek-Sa).  He has produced numerous albums for famous K-Pop artists with great successes including, but not limited to, Rain, G.O.D and Wonder Girls.

The plaintiff Mr. Shin-Il Kim, a K-Pop composer, had filed a lawsuit against Mr. Park on July 2011, claiming Mr. Park’s song titled “Someday”, sung by IU, had infringed his song titled “To My Man” and he is entitled to a compensation of approximately 90,000USD.

It was reported that the judge recommended a settlement to the parties before issuing the ruling, but the both parties objected to it.  And finally the court sided with the plaintiff.  The Court found that four bars from the chorus of the defendant’s song is substantially similar to that of the plaintiff’s song which constitutes a copyright infringement and ordered the defendant to pay approximately 20,000USD to the plaintiff as a remedy.

Under Korean copyright law, a claim for plagiarism and copyright infringement is established when the defendant had access to the copyrighted work of the plaintiff and there exists a substantial similarity between the two works.  With regard to the first element, Continue reading


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

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, Continue reading