Coupang rejects 100000 won payouts for data breach victims

The e-commerce giant declined a consumer agency mediation proposal after a breach affecting more than 33 million users.

E-commerce giant Coupang has rejected a proposal to pay 100,000 won ($73) to each of the 50 customers who sought compensation over a massive data breach late last year, industry sources said Wednesday.

“We carefully reviewed the mediation proposal but ultimately concluded that it would be difficult to accept,” Coupang notified the Korea Consumer Agency (KCA) in writing on Friday. “The decision took into account both the proactive measures we have taken so far and the potential impact of accepting the proposal at and abroad.”

In June, Korea’s Personal Information Protection Commission fined the company 642.68 billion won and imposed an additional administrative fine of 16.8 million won over a major data breach that leaked the personal information of over 33 million users last November.

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The KCA reviewed the case after 50 consumers filed for collective dispute mediation over last year's data breach. The agency concluded that Coupang was liable for emotional distress.

The agency proposed compensation of 100,000 won in cash or 100,000 won worth of Coupang shopping vouchers per victim.

Had Coupang accepted the proposal, the same compensation could have been extended to victims who did not directly participate in the collective mediation process. The company's total payout was estimated to potentially reach 3.7 trillion won.

Coupang appears to have concluded that further compensation would be difficult to accept because the commerce giant has already introduced its own compensation program. The company has provided Coupang shopping vouchers worth 50,000 won each to 33.7 million people whose personal information was compromised.

Coupang's voluntary compensation package is worth 1.69 trillion won.

Civic groups strongly criticized the company's decision.

“Coupang is essentially saying that it will fight victims in civil court over any additional liability,” a coalition of civic groups said during a press conference on Wednesday. “It is the height of shamelessness.”

With Coupang's rejection of the mediation proposal, disputes over additional compensation for victims of the data breach are now more likely to move into civil litigation.

BY PARK YOUNG-WOO [[email protected]]

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.