[Invest&Law] Challenging a 100 Billion Won Fine... Will US Big Tech Face a Heavy Blow?

Unauthorized Collection of Personal Data by Google and Meta
Administrative Lawsuit Filed Last Year Claiming "Unfairness"
Newly Established International Legal Affairs Bureau Prosecutor vs. Google and Meta's Kim & Chang

Google and Meta's administrative lawsuits challenging the 100 billion won-level fines imposed by the Personal Information Protection Commission (Chairman Ko Hak-soo) have escalated into a legal battle involving the Ministry of Justice and major law firms.

In this case, which involved the largest fine ever imposed for violations of personal information protection regulations, prosecutors from the newly established International Legal Affairs Bureau of the Ministry of Justice are facing off against Kim & Chang law firm representing Google and Meta, marking their 'debut' in litigation. Industry attention is focused on how Korean courts will rule on the big tech companies' practice of collecting behavioral information without obtaining consent from the data subjects, the users.

◆ Ministry of Justice, Haegwang, Minhu, Choi Seon vs. Kim & Chang = According to the legal community on the 16th, the lawsuits filed by Google and Meta against the Personal Information Protection Commission (PIPC) seeking cancellation of corrective orders and other sanctions began hearings in September last year and have recently held their third hearing.

On the PIPC side, elite prosecutors from the International Legal Affairs Support Division of the Ministry of Justice's International Legal Affairs Bureau have taken charge of the litigation. Deputy Prosecutor Shin Dong-hwan (45, Judicial Research and Training Institute Class 36), who has experience working in the World Bank's anti-corruption investigation team, and Prosecutor Lee Sung-jik (32, 2nd Bar Exam), who graduated from a U.S. law school (LL.M) and obtained a New York State Bar license, have appeared in court to represent the PIPC.

This case is the first in which prosecutors from the newly established International Legal Affairs Bureau have represented the government side. Since this lawsuit involves the Korean government asserting the 'personal information sovereignty' of its citizens against global tech giants, the plan is to mobilize all legal capabilities. The International Legal Affairs Bureau, launched in August last year under former Minister of Justice Han Dong-hoon, focuses on strengthening government responses in investor-state dispute settlement (ISDS) and international litigation.

Law firms have also joined to support the PIPC. Haegwang Law Firm, led by former high court judges Choi Chang-young (66, Class 24) and Lim Sung-geun (60, Class 17), the intellectual property boutique firm Minhu Law, and Choi Seon Law Firm, formed by former Kim & Chang lawyers, have joined the PIPC's legal team.

Kim & Chang law firm, representing Google and Meta, has deployed veteran international litigation lawyers with judicial backgrounds. Lawyer Lim Si-gyu (64, Class 15), former head of the Judicial Support Office at the Court Administration, and lawyer Kim Dong-guk (53, Class 28), a former presiding judge, are acting as Google's legal representatives. On Meta's side, lawyer Choi Cheol-hwan (61, Class 23), former presiding judge at Suwon District Court and legal secretary at the Presidential Office's Civil Affairs Office, and lawyer Kim Se-yeon (56, Class 23), the first Korean woman appointed as a member of the ICC International Court of Arbitration, are representing Meta. A ruling is expected as early as this year.

◆ ‘Information Collection Without Consent’ Severely Punished Overseas = In September 2022, the PIPC ordered Google and Meta to correct their violations of the Personal Information Protection Act, stating that they collected behavioral information (online activity data that can identify users' interests and tendencies) without user consent and used it for online personalized advertising. The PIPC imposed fines of 69.2 billion won on Google and 30.8 billion won on Meta.

This was the first sanction imposed by the Korean government regarding the collection and use of behavioral information for online personalized advertising platforms. It was the largest fine ever for violations of personal information protection regulations. In response, Google and Meta filed lawsuits in February last year, claiming the PIPC's sanctions were unjust.

The PIPC maintains that "the corrective measures were lawful because the platforms collected and used personal information without users' knowledge under the pretext of providing free services." On the other hand, Google and Meta argue that "consent for collecting behavioral information should be obtained by the website or application service providers, not the platform operators."

Overseas, there is a trend of imposing strict sanctions on big tech companies for collecting user behavioral information and using it for personalized advertising. The French National Commission on Informatics and Liberty (CNIL) fined Google 65 billion won in February 2020 for violating transparency requirements related to personalized advertising and failing to obtain explicit user consent. In June of the same year, the French Council of State upheld the CNIL's decision.

In June 2020, the German Federal Court of Justice ruled that Facebook (Meta) violated competition law by restricting user choice to provide personalized advertising, calling it an exploitative practice.

Reporter Hong Yoon-ji, Law Times

※This article is based on content supplied by Law Times.