Court: "Golfzon's 'Course Reproduction' to pay 600 million won compensation to 3 golf course companies"

[Asia Economy Reporter Kim Daehyun] The court has ruled that Golfzon, which used golf course footage from golf courses without permission in its screen golf videos, must pay a total of over 600 million KRW in damages to three golf course operators including the Korea Tourism Organization.

According to the court on the 17th, the Seoul Central District Court Civil Division 62 (Presiding Judge Lee Younggwang) partially ruled in favor of the plaintiffs in the first trial of a damages lawsuit worth over 2 billion KRW filed by three golf course operators including the Korea Tourism Organization against Golfzon. The court ordered Golfzon to pay 137 million KRW to the Korea Tourism Organization, over 62 million KRW to Pyeongsan Investment Development, and 439 million KRW to Sky72.

Golfzon has been ordered in the first trial to pay a total of over 600 million won in compensation to three golf course operators. The photo is unrelated to the article content. [Image source=Pixabay]

Previously, Golfzon included videos reproducing the golf courses of Pyeongsan Investment Development’s Pristine Valley CC, Korea Tourism Organization’s Jungmun CC, and Sky72’s Sky72 CC (currently under different management) in its screen golf system.

The operators filed for damages in 2015, citing copyright infringement and illegal acts by Golfzon. They argued, "According to the contract with the golf course designers, the copyrights of each golf course belong to the operators," and "The defendant (Golfzon) used the comprehensive image including the golf course names, which are the operators’ achievements, without permission, infringing on their economic interests."

The court did not accept the operators’ claim of 'copyright infringement.' Although each golf course qualifies as an 'architectural work,' the court ruled that the copyright holder is the designer, not the operators, based on the design service contract.

However, the court recognized liability for damages under illegal acts and unfair competition, stating, "Producing and using videos of each golf course and using identical or similar names constituted unauthorized use of the operators’ achievements."

The court noted, "According to the defendant’s Q3 2020 quarterly report, the defendant’s business is characterized by implementing environments similar to actual golf courses. This similarity is an element the defendant itself promotes as a competitive advantage," and added, "Screen golf provides an experience similar to real golf. It is less expensive and more accessible than field golf, so considering time, economic costs, and seasonal and weather changes, many users likely choose screen golf."

However, the court limited the scope of liability, stating, "A significant portion of operating profit is likely due to the defendant’s technology, business know-how, and marketing activities." It also added, "There are indirect benefits to the operators, such as users developing an interest in field golf after experiencing simulation golf and subsequently using field golf courses, as well as promotional effects for the golf courses, which appear to work somewhat in favor of the operators."