Construction & Real Estate
[Preservation] A case in which a claim for interim injunctive relief for surrender and demolition in relation to unregistered shop premises
1. Case summary A creditor (or the client) executed a lease with a developer of a large-scale commercial and residential building for the operation of a kids’ café (which is a play area for children) in the building, pursuant to which the creditor agreed to distribute certain profits from the operation of the kids’ café to the developer. The creditor was preparing for opening the kids’ café upon the completion of construction. Around the time when the construction of the building was almost completed, the debtor (i.e., the developer) insisted that it should terminate the lease, alleging that the creditor made a false representation regarding his business capabilities. The debtor also started constructing walls partitioning the store with intent to lease part of the store to a third party. The creditor filed a claim for interim injunctive relief against the developer, seeking the removal of the non-bearing walls installed in the store and the surrender of the store to it. After a more than one-month long dispute, the Suwon District Court granted interim injunctive relief against the developer as claimed by the creditor on April 22, 2021. 2. Decision and implications With regard to a claim for interim injunctive relief of which purpose is not simply ended with the preservation of execution but that is made to obtain a final satisfaction just like compulsory execution made on the basis of a decision on merits, courts generally grant interim injunctive relief in exceptional cases on the basis that any decision on the grant of such interim injunctive relief will have a material effect on the parties involved and could cause an recoverable result to a debtor, and therefore, a creditor is required to significantly clarify its rights to be preserved by the claim for interim injunctive relief and the necessity of preservation. Our attorneys representing the client argued that the rights to be preserved by interim injunctive relief and the necessity of preservation was so significantly clarified that the client should be granted interim injunctive relief, arguing that (i) the creditor had been unilaterally subject to the termination of the lease even in the situation where he had not commenced to use the store; (ii) fraud alleged by the debtor did not exist and the credit report that the debtor had presented as evidence of fraud was a document prepared after the debtor’s notice of termination; and (iii) it was significantly difficult for the parties to calculate damages (including operating profits, etc.) because the creditor had not started business. The Suwon District Court accepted our arguments and made an order that the debtor remove the non-bearing walls installed in the store and surrender the store to the creditor. The creditor was able to normally start business in the store.
2021. 06. 01
[Intellectual Property Rights] A case in which we helped a client keep its franchise brands, “봉구치킨 (Bonggu Chicken)” and “봉구통닭 (Bonggu Tongdak)” which had been rejected by KIPO due to similarity to “봉구비어 (Bonggu Beer)”
1. Case summary 1) Who did Barun Law (attorneys Oh Sung-hwan and Nam Yeon-jeong) Bogosipda Co., Ltd. (which is a franchisor of Miss You and Bonggu Tongdak) 2) Case background ❶ The complainant filed applications for the trademarks “봉구치킨 (Bonggu Chicken)” and “봉구통닭 (Bonggu Tongdak)” (collectively, the Trademarks”) with KIPO. ❷ A holder of a trademark “Bonggu Beer,” which was registered prior to the application for the Trademarks, filed an appeal to the Trademarks. ❸ KIPO rejected to register the trademark Bonggu Chicken for the reason that it was similar to Bonggu Beer. (The trademark “Bonggu Tongdak” was subject to the suspension of evaluation.) ❹ We filed an appeal to KIPO’s decision on rejection on behalf of the complainant. ❺ As the complainant already had a number of franchisees across the country, the success and failure of the franchise business depended on the result of the appeal. 2. Issue Similarity of the trademark “Bonggu Chicken” to the registered trademark “Bonggu Beer” 3. Our role and argument While determining that “Bonggu” could not be perceived separately from the two trademarks, KIPO considered that consumers could confuse the source of the two trademarks and rejected to register the trademark “Bonggu Chicken.” In response to KIPO’s determination, we argued that similarity in the two trademarks should be decided by observing the entire elements of the trademarks not by just observing specific or separate elements of the trademarks. We also presented precedents regarding trademarks containing the word “Bonggu” to point out that KIPO had made several errors in making a rejection decision. We made arguments that the possibility of confusion did not exist in “Bonggu Chicken” and “Bonggu Beer.” 4. Trial The Korean Intellectual Property Tribunal canceled the original decision (i.e., refusal to register) and sent the case back to KIPO on the ground that similarity in the two trademarks should be examined by comparing each other as a whole, the two trademarks had different concepts, appearance and name so that there was no concern that consumers would confuse the two trademarks, it was hard for it to find that Bonggu Chicken would be perceived as a sub-brand of Bonggu Beer, and therefore, there was no reason for KIPO to refuse to register the trademark Bonggu Chicken. 5. Implications In a situation where brand related disputes are intensifying with the franchise business in the restaurant industry booming, this judgment is meaningful in that it specifically presents criteria for judging similarity in trademarks containing common names (ex., Bonggu) and misunderstanding and confusing of the source of such trademarks.
2021. 06. 01
Tax and Criminal Matters
[Criminal] A case in which we drew a decision on the exemption of punishment by applying the latter paragraph of Article 39(1) of the Criminal Act that becomes almost a dead letter as the provision is hardly utilized.
1. Case background ① Who did Barun Law represent? A natural person who runs a sole proprietorship and an entity (“Mr. A”) ② Case background Mr. A runs a sole proprietorship (“X”) and a legal entity (“Y”). He thought that it would be advantageous to his business if the two businesses had sales. He executed a transaction in which X and Y gave and received research service each other. The tax authority determined that the transaction was fictitious on the ground that the two businesses had the same business address, that both businesses had no employee except for Mr. A, that there was no financial record showing that the two businesses made payments for services as they set off the payments against each other; and that the content of service was far less than the value of the payments. The tax authority filed a charge against Mr. A with the prosecution as a tax offender for the issuance and receipt of fictitious tax invoices. Mr. A was indicted and was found guilty. He was sentence to one year in jail with a stay of execution for two years and a fine of KRW434 million. The tax authority filed an additional lawsuit against Mr. A with another court in relation to an allegedly fictitious tax invoice of KRW22,086,700, which was one of the tax invoices between the two businesses, for the reason that it had not filed a charge against Mr. A with regard to the tax invoice in the previous lawsuit. 2. Litigation and our role Mr. A argued that the tax invoice with the transaction amount of KRW22,086,700 later indicted was not a false tax invoice because it was about a real transaction. At the same time, he argued that, in case he was found guilty, he was convinced that the additional charge would not have resulted in additional punishment if it had been filed with the charges for which he had already punished. Therefore, according to the latter part of Article 39 of the revised Criminal Act, even if he is found guilty, he argued that he should be exempted from punishment for the additional charge. The court rejected the plea of innocence and found that he was guilty, but ordered the defendant to be exempt from punishment as defended by us. 3. Implications The latter part of Article 39 (1) of the Criminal Act stating that, in the case of a belated prosecution of a crime that could have been punished at the same time as a confirmed crime, the sentence of the subsequent prosecution case may be reduced or exempted in consideration of equality was added on July 29, 2005. Nevertheless, in practice, there have been few cases in which sentences are exempted on the ground of this amended and added provision. As a result of this, Article 39(1) of the Criminal Act becomes almost a dead letter. We appropriately cited and pointed out the purpose of the revised law and actively made the defense of sentence. Although Mr. A was found guilty; we were able to draw the lightest sentence possible under the law that did not cause any harm to the client. This case is significant in that we help the client by utilizing the intent of the revised provision which becomes almost a dead letter to the fullest possible extent.
2021. 06. 01
HR and Labor Affairs
[HR/Labor] A decision confirming that a freelance computer programmer who is hired for a certain project does not constitute a worker under the Labor Standards Act
1. Case summary ① Who did Barun Law (attorneys Noh Man-kyeong, Moon Ki-joo and Lee Jong Hwa) represent? An ICT venture company engaging in software development and total solution service such as maintenance and management in the ICT field.
② Case background: An ICT venture company (“J Company”) executed a service contract for a certain period of time (the “Contract”) with freelancer computer programmers (the “Programmers”) and received service from them for a certain project (to develop a certain software program) under a certain service contract with its contractor. After the purpose of the Project had been achieved, the Contract with the Programmers was terminated.
③ Litigation: One of the Programmers (the “plaintiff”) filed a civil suit against J Company primarily for his reinstatement and the payment of outstanding wages and preliminarily for the payment of severance pay and allowances for annual leave allegedly receivable by him as a worker from the employer, arguing that he constituted a term-based worker under the Fixed-Term Employees Act and the termination of the Contract constituted unfair dismissal.2. DecisionOn April 23, 2021, the 13th Civil Division of the Seoul Southern District Court dismissed all the claims made by the plaintiff, ruling, “The plaintiff’s primary and preliminary claims should be made on the basis that the plaintiff constitutes a worker under the Labor Standards Act. However, considering general circumstances, including the fact that the plaintiff was responsible for specific development tasks provided under the Contract, we cannot recognize that the plaintiff is a worker under the Labor Standards Act providing service to the defendant in the subordinate relationship for the purpose of wages. Thus, the plaintiff’s primary and preliminary claims which were made on the basis that he constitutes a worker under the Labor Standards Act have no merits.”3. Our argument and roleFully utilizing experience that we have accumulated from a number of lawsuits we won in relation to the issue regarding an employee’s status as a worker under the Labor Standards Act, we actively made and substantiated our argument for the client.Specifically, we argued that the Programmers had provided service for the defendant under a service contract and did not constitute a worker under the Labor Standards Act, making argument about the following issues: (i) the background of the Contract and the plaintiff’s perception and awareness of his status as a worker; (ii) the performance of the Contract by the Programmers, including the plaintiff; (iii) the plaintiff’s level of involvement with the work schedule caused by the special characteristics of the program development task; (iv) the management of attendance of the Programmers, the exercise of control over the Programmers and the application of the employment rules established by the defendant to the Programmers; (v) the nature of compensation paid to the plaintiff; and (vi) the subordinate nature and exclusivity of the Programmers towards the defendant.4. ImplicationsToday, the forms of labor provision are becoming increasingly complex and diversified. As in this case, we can easily find companies that sign short-term service contracts with freelance developers. Legal disputes related to their status are expected to frequently occur. Under these circumstances, the decision confirmed that freelance developers do not fall under the Labor Standards Act depending on the specific factual background and degree of proof, and will be an important criterion in judging the legal status of various labor providers, including freelance developers, in the future.
2021. 06. 01
[Intellectual Property] A case in which a court dismissed the injunction claim for the infringement of a patent right filed by a patent holder on the basis of the unreasonable expansion of the scope of the patent right
1. Case summary 1) Who did Barun Law (attorneys Kim Jae-ho, Chung Hyun-jee, Jung Young-hun, Shim Min-seon and Yoo Yun) represent? Defendant B 2) Case background Plaintiff A is a holder of a patent right to a certain invention (the “Patented Invention”) that was applied on July 3, 2012 and registered on February 26, 2014 (the “Patent Right”). Defendant B is a person engaging in authentication service by using its own server for credit card payments made by users. On June 29, 2018, Plaintiff A filed an injunctive claim for the infringement of the Patent Right with the Seoul Central District Court on the ground that a certain technology used by Defendant B was infringing the Patent (the “Technology”). Making excessively exaggerated interpretation of the scope of the Patent Right to the Patented Invention, Plaintiff A argued that the Technology infringed the text of the Patented Invention or violated the principle of equity. As a response to the argument, Defendant B argued that Plaintiff A’s interpretation went against the general legal theory as well as the description of the Patented Invention. The competent court dismissed the Plaintiff A’s claim. 2.Issues The issues in this case were whether it could be deemed that the credit card terminal, which is one of the elements consisting of the Patented Invention, was one identical to the PC in which the payment program was installed and whether Plaintiff A sufficiently proved that the Patent Right was infringed. 3. Our argument and role In this case, we convinced the court that ① according to the scope and description of the Patented Invention, the payment terminal (i.e., the seller’s terminal) could not be corresponding to the buyer’s PC in which the payment program was installed; and ② Plaintiff A failed to sufficiently prove its argument about the infringement of the Patent Right by the Technology.
4. Decision The Seoul Central District Court dismissed all the claims made by Plaintiff A in this lawsuit. 5. Implications The decision is meaningful in that the court precluded the extended interpretation of the scope of the Patent Right argued by Plaintiff A and dismissed the Plaintiff A’s injunctive claim on the basis of its finding that Plaintiff A had failed to prove the alleged infringement of the Patent Right by Defendant B.
2021. 04. 28
[Intellectual Property] A case in which we helped a franchise brand be recovered by preventing a potential lawsuit and registering a brand, which had been rejected by KIPO
1. Case summary1) Who did Barun Law (attorneys Oh Sung-hwan and Nam Yeon-Jeong) represent?Debtor: the franchisor of Kimboknam Beer2) Case background❶ The creditor in this case is a person engaging in the operation of Kimbongnam Pojangmacha (which is a small tented restaurant on wheels or street stalls) and holding the trademark “Kimbongnam.” The creditor filed an appeal to a trademark “Kimboknam Beer” with KIPO and KIPO rejected the debtor’s brand.
❷ The creditor filed for an injunctive relief against the trademark “Kimboknam Beer” for the infringement of the trademark “Kimbongnam”.
❸ Representing the debtor, Barun Law (i) filed for a trial with regard to the KIPO’s decision on the rejection of the debtor’s trademark and (ii) responded to the lawsuit for the injunctive relief filed by the creditor.2. IssuesThe issue in this case was similarity between the trademark “Kimbongnam” and the trademark “Kimboknam Beer.”Our argument and roleWe emphasized that “Kimboknam Beer” was a trademark of which similarity to a certain trademark should be determined through observations of entire elements consisting of the trademark not just through observations of important elements only or separated observations, and substantiated that “Kimboknam Beer” was a trademark recognized as a whole in the industry, presenting numerous use cases and evidence to the judges. We argued that “Kimboknam Beer” had appearances, names and concepts different from those of the trademark “Kimbongnam” and was not likely to mislead consumers or cause confusion in the industry. Our arguments were accepted.3. Progress of the lawsuit(i) The Korean Intellectual Property Tribunal decided that the original decision be cancelled and the debtor’s trademark be registered with KIPO since the two trademarks were not similar. (ii) The court dismissed the application for injunctive relief filed by the creditor on the ground that it did not find that the creditor had a right to be preserved by the alleged injunctive relief since there was no concern that the two trademarks were misleading or confusingly understood.4. ImplicationsIn recent years, brand disputes are intensifying as the restaurant franchise business has been booming. In particular, there are many trademarks in the restaurant industry that include names. The decision is significant in that it specifically presents the judgement criteria for allegedly misleading or confusing trademarks in the restaurant industry.
2021. 04. 28