In this blog post, we will examine how class action lawsuits can be an effective means of protecting citizens’ rights and holding companies accountable.
Tens of thousands of subscribers, including Mr. A, provided their personal information to Company A’s online job site. Someone who knew that Company A’s system was poorly managed created a link file and posted it on their blog. This allowed many people to freely view the information of the subscribers. Upon learning of this, Mr. A demanded that Company A suspend the operation of the site and pay compensation, but Company A refused. Mr. A considered filing a lawsuit, but hesitated because he thought the costs would be high compared to the amount of compensation he would receive. Mr. A gathered people to file a lawsuit through an online cafe, and eventually more than 100 subscribers joined. Gap filed a class action lawsuit with them against Company A, demanding that it cease operating the website and compensate them for damages.
A class action lawsuit is a lawsuit involving multiple parties. It allows lawsuits that could be filed individually to be heard and proceeded with in a single proceeding, which has the advantage of providing economic and efficient relief. However, if there are too many parties, it is difficult to proceed with the lawsuit all at once. Therefore, in practice, a lawyer is usually appointed jointly to conduct the lawsuit. In addition, a representative party system can be used, in which a party such as Mr. A is selected as the representative party and entrusted with the lawsuit on behalf of all parties.
Since a joint lawsuit is a procedure that brings together the interests of multiple people, it is important to coordinate various opinions and interests during the lawsuit. To this end, the selected party must gather the opinions of each participant and establish a litigation strategy based on those opinions. In addition, since the outcome of a joint lawsuit affects all participants, it is important to transparently share information on the progress and outcome of the lawsuit. This allows the participants in the lawsuit to protect their rights and interests more effectively.
In the above case, tens of thousands of subscribers suffered damages, but most of them did not participate in the lawsuit because the amount of compensation was small. Therefore, compared to the enormous scale of the total damage, the total amount of compensation that will be received if the lawsuit is successful will be very small. This results in inadequate compensation for damages and does not motivate companies to improve their systems. As a solution to this problem, the introduction of class action and group litigation systems, which are already in place in other countries, has been discussed.
Class action is a method whereby a representative party, representing the interests of all victims, files a lawsuit against a company to claim damages. If the victims, including the victimized party, file a joint lawsuit and win, only they will receive compensation. On the other hand, in a class action lawsuit, the judgment made by the representative party is, in principle, effective even for those who did not participate in the lawsuit. However, it is not easy to initiate a lawsuit because the representative party has to bear the burden of high litigation costs at the initial stage.
The introduction of class action lawsuits is particularly useful in cases where there are many victims with small claims. For example, in the event of damage caused by a large-scale data leak or product defect, people who find it difficult to file individual lawsuits can join forces through a class action lawsuit to make their voices heard. This can serve to restrain unfair practices by companies and provide practical relief to victims. Class action lawsuits also serve to raise awareness throughout society and encourage companies to operate more responsibly.
A group lawsuit is a system that allows organizations with expertise and experience, as defined by law, to file a lawsuit against a company to seek the cessation of infringing acts. In the above case, it would have been more effective if a professional organization such as an IT-related association had filed the lawsuit. However, class action lawsuits are recognized for public interest reasons, and therefore cannot be used to claim damages for individual victims. Class action lawsuits are mainly applied to public interest issues such as environmental pollution and consumer rights violations. Through this, they protect the interests of society as a whole and contribute to correcting unfair practices by companies.
Recently, Korea has also introduced class action lawsuits and group lawsuits on a limited basis. First, the Securities Class Action Law was enacted, allowing people who suffered damages from stock investments due to reasons such as false disclosure or manipulation of accounting information by companies to file class action lawsuits. Group lawsuits were also introduced later, but they are limited to consumer disputes and personal information damage under the Consumer Basic Act and the Personal Information Protection Act. The introduction of these systems has made it easier for victims to seek redress and has prompted companies to exercise greater management and responsibility. In addition, these legal systems emphasize corporate social responsibility and promote more transparent and reliable management.
The introduction of class action lawsuits and group lawsuits is changing the legal environment of our society. These systems enable stronger protection of individual rights and allow companies to build trust through responsible management. This ultimately benefits society as a whole and contributes to the creation of a fair and transparent society.
