Remarks made at Tuesday's audit of Ministry of Science and ICT

Lawmaker urges ministry to demand Coupang correct SEC filings

Rep. Lee Hoon-gi of the Democratic Party of Korea [provided by lawmaker's office]
Rep. Lee Hoon-gi of the Democratic Party of Korea [provided by lawmaker's office]

Rep. Lee Hoon-gi of the Democratic Party of Korea, who represents Incheon's Namdong-eul district, said Tuesday at a national audit of the Ministry of Science and ICT that Coupang Inc. had already lost the trust of American markets over a personal data breach. "Coupang has already lost credibility in the United States. It must stop deceiving our people," he said.

An analysis by Lee's office of Coupang Inc.'s share price and market capitalization found that the stock, which stood at $13.78 on Monday, had fallen about 57.1 percent from $32.13 on Nov. 4 last year — before the data breach became public.

Over the same period, the company's market capitalization shrank from about 79 trillion won ($58.2 billion) to about 33.4 trillion won, a decline of 45.6 trillion won, or roughly 57.7 percent.

Regarding the matter, Lee urged the Ministry of Science and ICT to accurately inform overseas markets of the government's investigation findings and to push for corrections to Coupang Inc.'s SEC disclosures, presenting data on the decline in share price and market capitalization in US capital markets as well as the status of class-action lawsuits.

According to Lee's office, two class-action lawsuits related to the Coupang data breach are currently under way in the United States. On Jan. 6, US investors filed a securities class-action suit against Coupang Inc., its Korean subsidiary Coupang Corp. and its executives in the US District Court for the Western District of Washington, alleging that the company's disclosures related to the data breach were false. A consumer class-action suit covering data breach victims in both the United States and South Korea was subsequently filed Feb. 6 in the US District Court for the Eastern District of New York.

"Both investors and consumers in the United States are holding Coupang directly accountable through class-action suits, and the share price and market cap have both fallen by more than half compared to before the breach became public," Lee said. "This shows just how seriously the scale of the data leak and the accuracy of corporate disclosures are taken in the United States."

Lee also pressed Deputy Prime Minister and Science and ICT Minister Bae Kyung-hoon on the scope of the breach, asking whether the government's own investigation had confirmed a leak of about 33.67 million personal records — not the "3,000 cases" Coupang has cited. He noted that even after the government released its findings, Coupang continued to state in its SEC filings and annual report that "only limited information on approximately 3,000 cases was stored, that it was deleted, and that it was not shared with any third party."

Lee also took issue with what he described as a double standard by Coupang and its chairman Kim Bum-suk. When the South Korean government investigated and sanctioned the company, Coupang argued it was being discriminated against as a US firm, Lee said. Yet when class-action suits were filed in the United States, the company argued that the breach had occurred at its Korean subsidiary, Coupang Corp., and therefore fell outside the jurisdiction of US courts.

"It is hard to understand why Coupang calls it 'discrimination against a US company' when the South Korean government investigates and sanctions it under the law, while investors and consumers in the United States are filing class-action suits and holding Coupang directly accountable," Lee said. "If there is a discrepancy between the government's investigation findings and Coupang's overseas disclosures, the Ministry of Science and ICT must work actively with related ministries to correct it."


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