Samsung Heavy Industries Subcontractor Loses Lawsuit Over 'Gapjil' Abuse Claims
"Opinion: 'Low Compensation Amount, Effectively a Win'"
[Asia Economy Reporters Seongpil Jo, Daehyun Kim] Subcontractors who claimed to have been subjected to 'gapjil' by Samsung Heavy Industries filed a lawsuit seeking hundreds of billions of won in damages and partially won in the first trial. However, the amount of damages recognized was far less than the claimed amount, leading to remarks that the ruling was practically a victory for Samsung Heavy Industries.
The Civil Division 16 of the Seoul Central District Court (Presiding Judge Ki-hwan Lim) ruled on the morning of the 27th in a damages claim lawsuit filed by six companies including Bohyun Enterprise against Samsung Heavy Industries, partially in favor of the plaintiffs. The court ordered Samsung Heavy Industries to pay Bohyun Enterprise and the other defendants between 105 million and 370 million won each. The claim by Mr. Jeong, an individual, against Samsung Heavy Industries for the same reason was dismissed.
Earlier, Bohyun Enterprise and others filed the lawsuit in May 2018, claiming that damages occurred to their companies due to Samsung Heavy Industries' gapjil. They alleged that Samsung Heavy Industries unfairly determined or reduced subcontract payments and did not pay agreed amounts. They also stated that there were many cases where indirect construction costs or payments were not received. They claimed the total damage amounted to 27.6 billion won and that Samsung Heavy Industries was liable for compensation.
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The court partially accepted their claims but calculated the damages at a very low level compared to the claimed amount. The total damages recognized by the court amounted to about 1.6 billion won, approximately 6% of the claimed amount. Following the verdict, comments were made in the courtroom such as "After deducting litigation costs, nothing remains, so it is practically a ruling against the plaintiffs." It is not yet known whether Bohyun Enterprise and others will appeal.
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