bhc Loses Lawsuit Claiming BBQ Spread Malicious Defamation Posts

[Asia Economy Reporter Kim Hyung-min] Chicken franchise bhc lost a lawsuit filed against its competitor BBQ, alleging that BBQ spread malicious defamatory posts about bhc.

The Seoul Central District Court Civil Division 25 (Presiding Judge Song Seung-woo) ruled on the 23rd that bhc lost the first trial in its damages claim lawsuit against Genesis BBQ and Chairman Yoon Hong-geun.

According to industry sources, Mr. A, who handled marketing for BBQ, recruited bloggers in April 2017 to write defamatory posts about bhc. In May of the same year, bhc filed a complaint with the police requesting an investigation into the incident. Mr. A was prosecuted for obstruction of business and other charges and received a summary order of a 10 million KRW fine. Although suspicions arose that Chairman Yoon was involved in Mr. A’s wrongdoing, he was cleared of charges in June 2019. Subsequently, in November 2020, bhc filed a lawsuit seeking damages against Mr. A, Chairman Yoon, and BBQ, claiming that "malicious content contrary to facts was spread, severely damaging the company’s image."

The court ruled that "there is insufficient evidence to recognize that the defendants participated in the criminal acts in this case," siding with Chairman Yoon and BBQ. The court added, "The contract in this case is not unusual compared to typical advertising and promotional agency contracts," and "there is no evidence that the defendants knew Mr. A would commit illegal acts during the contract execution."

Before the first trial verdict, bhc expressed its intention to withdraw the lawsuit. Mr. A agreed to the withdrawal, concluding the case, but Chairman Yoon and BBQ reportedly submitted a letter of refusal, stating they would "prevent the abuse of lawsuits to harass competitors."

Meanwhile, BBQ has been engaged in legal disputes involving various accusations and lawsuits since selling its former subsidiary bhc to a U.S.-based private equity fund in 2013. Between 2013 and 2020, BBQ filed about ten lawsuits or complaints against bhc Chairman Park Hyun-jong and employees, and bhc also filed multiple lawsuits seeking damages against BBQ. Chairman Park was prosecuted for illegal access to BBQ’s internal computer network and was sentenced to six months in prison with a two-year probation in the first trial in June.