Kakao Entertainment Wins Lawsuit Over "Copyright Power Abuse" Fine

Web Novel Contest Contract Dispute Settled For Now
Kakao Entertainment Scores Decision Win In Administrative Lawsuit

Kakao Entertainment, which had been fined by the Korea Fair Trade Commission for allegedly unfairly restricting web novel writers' rights to create derivative works, has won its case after an administrative lawsuit.

The Administrative Division 6-3 of the Seoul High Court (Presiding Judges Baek Seungyeop, Hwang Uidong, and Choi Hangseok) ruled on the 11th in favor of the plaintiff in the lawsuit filed by Kakao Entertainment against the Fair Trade Commission seeking to cancel the corrective order and the order to pay an administrative fine.

Previously, in 2023, the Fair Trade Commission found that Kakao Entertainment's conduct in obtaining exclusive rights to create derivative works from 28 prize-winning authors in five web novel contests it held between 2018 and 2020 constituted unfair trade practices by abusing its superior bargaining position.

At the time, the Fair Trade Commission ordered corrective measures and imposed an administrative fine of 540 million won, stating that Kakao Entertainment had restricted the authors' rights by specifying in the contest guidelines that "the rights to create derivative works of the winning entries belong to KakaoPage."

In response, Kakao Entertainment filed an administrative lawsuit, arguing that there had been no case in which it had unfairly acquired creators' rights.