* See an update on the situation from 2020.
The Republic of Korea (“South Korea”)’s courts expanded precedent for financial punishment of Japanese companies on March 25, 2019, when it approved a takeover of six patents and two trademarks worth a total of over 800 million won (about JPY 80 million or US $700,000). The Daejeon District Court affirmed plaintiffs’ demands for reparations by Mitstubishi Heavy Industries (MHI), which had conscripted them for work in Nagoya, Japan near the end of World War II (when the Japanese Empire held the Korean peninsula as a colony).
Following the court’s decision, Mitsubishi Heavy Industries is being told to comply with reparation orders or watch these IP rights be sold. MHI refused to obey the November 2018 decision requiring it to make reparations. The Japanese government’s position has been that compensation like this was precluded by an agreement made with the peace accord of 1965 between the governments of South Korea and Japan.
How the struggle will end for the two countries and citizens is unclear. In January 2019, Nippon Steel & Sumitomo Metal Corporation was dealt a similar blow for similar reasons by seizure of stocks. Now with the MHI case, intellectual property is on the table as fair game to force or replace the reparations. Other Japanese companies with similar histories in Korea may have to face more of this punishment. A class action against numerous Japanese companies that allegedly abused Koreans during the occupation is currently under preparation.
Hopefully peace and stability between these two key intellectual property nations will return and increase, and a fair resolution reached for the embroiled parties.
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** The information provided on this website is for informational purposes only and is not intended as legal advice.
Taro Yaguchi
Sources
[1] Chuo Nippo news, “韓国裁判所、三菱重資産差し押さえ決定…日本「極めて深刻」 [Korean court decides seizure of Mitsubishi Heavy’s assets; Japan sees this as ‘extremely seriuos’],” March 26, 2019.
[2] The Japan Times, “South Korea court approves seizure of Mitsubishi Heavy trademarks and patents over wartime forced labor,” Kyodo, March 26, 2019.
