South Korean Court Rejects Forced Labor Lawsuit Against Japanese Firms

The Seoul Central District Court dismissed on June 7 a lawsuit filed by 85 victims of wartime labor and their relatives against 16 Japanese firms, stating that acceptance of the case could violate a treaty under international law.

The treaty in question is the 1965 Japan-South Korea agreement on the settlement of claims.

Previously, in October 2018, South Korea’s Supreme Court ordered Japanese companies to pay compensation for “forced labor.” The central district court rejected the high court’s ruling.

“To make a judgment that goes completely against a judicial precedent is excessively unjust,” said a lawyer representing the plaintiffs.

The Supreme Court ruling declared Japan’s colonial rule as illegal and the wartime mobilization of workers as inhumane.

However, the Seoul District Court ruling pointed out that the illegality of Japan’s colonial rule was only recognized under South Korean law, and it could not justify this case’s “breach” of the 1965 Japan-South Korea agreement on the settlement of claims.

Moreover, the court emphasized that if the seizure of assets accompanying the compensation order develops into a diplomatic issue, “this would violate constitutional principles relating to state security and the maintenance of order.”

The court concluded, “Although individual claim rights have not been completely banished, exercising such rights in lawsuits has its limitations.”

In 2015, a group of plaintiffs sued several Japanese companies, including Nippon Steel & Sumitomo Metal Corp. and Mitsubishi Heavy Industries, demanding ₩8.6 billion KRW ($7.7 million USD) in compensation.

Japanese Government’s Stance

The Japanese government regards the Seoul Central District Court’s rejection favorably, but it is still keeping a close eye on the South Korean government’s stance on unresolved issues concerning the two countries.

In a news conference on June 7, Chief Cabinet Secretary Katsunobu Kato pointed out that Japan-South Korea relations were extremely delicate as a result of the South Korean government’s handling of the so-called wartime labor lawsuits and comfort women issues.

“It is important that South Korea takes responsibility and helps solve the unresolved issues. We are monitoring the specific proposals coming out of Seoul,” Kato said.

Meanwhile, in reference to the June 7 ruling, a Ministry of Foreign Affairs senior official commented: “It is better than losing the case. It follows on from a similar ruling in April, and puts Japan at ease. One can’t evaluate without looking at the entire forest.”

In the wake of the South Korean Supreme Court’s 2018 ruling, which ordered Japanese companies to pay compensation, the assets of Japanese firms in South Korea have been seized, and the cashing of these assets continues.

Moreover, under a January 2021 court ruling, the Japanese government was ordered to pay compensation to former comfort women. Such issues continue to linger.

In a news conference on June 7, Keidanren (Japan Business Federation) chairman Masakazu Tokura described the latest court ruling as “a very good thing.” Tokura added: “If Japanese assets in South Korea are taken away, we will be in a tricky situation. I expected the Japanese and South Korean governments to ensure this doesn’t happen.”

Meanwhile, a spokesperson for Nippon Steel & Sumitomo Metal Corp. commented: “We understand that the so-called forced labor issue has been officially solved ‘finally and irreversibly’ between Japan and South Korea. We accept this appropriate judicial ruling.”

(Read the related Sankei Shimbun stories in Japanese here and here.)

Authors: Tatsuya Tokiyoshi (Seoul), Tatsuhiko Tamura