Coupang Inc. [Yonhap]
Coupang Inc. [Yonhap]

Plaintiffs and defendants clashed over whether a US court is the right venue to hold Coupang Inc. liable for a massive data breach, in a class-action lawsuit filed in the United States.

According to the US District Court for the Eastern District of New York on Tuesday, Coupang Inc. and its board chairman Bom Kim filed a letter with the presiding judge earlier this month asking that the damages lawsuit brought against them over the data breach be dismissed without a preliminary hearing.

Coupang Inc. argued that the data breach occurred at its Korean subsidiary, not at the American parent. "It is not appropriate to litigate this case in New York. This is a Korean matter," the company said. It also drew a line between itself and the Korean unit, saying "Coupang Inc. is a Delaware holding company with subsidiaries around the world, and Coupang Corporation — the Korean entity — is no more than one of them."

Coupang Inc. also said the plaintiffs had failed to present any facts showing that Coupang Inc. or Chairman Kim exercised control over specific security decisions related to the Korean data breach. It also noted that multiple lawsuits have already been filed in Korea in connection with the breach, saying the plaintiffs were engaged in "forum shopping" — the practice of selecting a favorable jurisdiction for litigation.

Coupang Inc. is represented by major US law firm Kirkland & Ellis. The plaintiffs said Coupang Inc. presents the Korean subsidiary to investors as its core operating unit while taking the position in court that it has no knowledge of the subsidiary's affairs. Coupang Inc. is the 100 percent owner of the Korean entity.

In a rebuttal letter filed last week, the plaintiffs said: "You cannot present the Korean entity to investors as the operational core of the group, and then ask a court to treat it as a company far removed from the American parent."

The plaintiffs argued that with factual disputes still unresolved, the defendants were seeking dismissal before any discovery had taken place. They said any ruling on jurisdiction should be deferred at least until discovery is completed — covering records related to the breach, decision-makers, internal oversight, and communications between the parent and its subsidiary. Discovery is a US legal procedure in which parties to a lawsuit may request that the opposing side disclose evidence, documents, and witnesses before the main trial begins.

Tal Hirschberg of law firm SJKP, which represents the plaintiffs, explained the rationale for filing suit in the United States at a press conference after the complaint was submitted in February. "Coupang Inc. was incorporated under US commercial law and owes duties to everyone who uses Coupang — including Koreans, not just American citizens," he said. "We believe that using US courts will help us obtain better information about what went wrong on Coupang's part," he added.

The US lawsuit against Coupang Inc. is expected to proceed separately from cases filed in Korean courts. It is also set to move forward independently of a shareholder class-action suit filed earlier in the US District Court for the Northern District of California.


yckim6452@heraldcorp.com