[In-Depth Review] Punitive Damages System and the Prohibition of Frivolous Lawsuits Act

Published 22 Jun.2020 13:11(KST)

A bill to amend the "Act on the Mediation and Relief of Damage Caused by the Press" has been proposed, allowing for punitive damages of up to three times the amount of actual damages when honor or other rights are damaged by media reports. This amendment, centered on 'punitive damages,' is recognized as necessary because intentional and repeated false reporting harms not only the parties involved but also the public who consume such reports.

However, there are voices opposing the bill’s background and purpose without offering concrete alternatives. They argue it is the "government’s ambition to control the media" and a "malicious law that restricts freedom of the press and freedom of expression." While not entirely incorrect, if the amount of damages increases significantly, it could lead to a chilling effect where media outlets self-censor suspicious reports that are not 100% substantiated.

Nonetheless, the public demands reform of the media. According to the Media Arbitration Commission’s report on media rulings, the plaintiff win rate for media victims was only 49.31% over ten years from 2009 to 2018. A survey conducted by a public opinion research institute also showed that 81% supported the introduction of punitive damages against media companies. The majority of the public supports 'punitive' damages.

However, if only the media is held liable for punitive damages due to distrust, it will ultimately benefit only those with money and power. Politicians, high-ranking officials, and conglomerates can use the amended media arbitration law as a weapon to muzzle media outlets that write critical articles about them. Already, the average damages awarded in media lawsuits filed at the Seoul Central District Court in 2018 reached 14 million KRW. With the introduction of punitive damages, this amount would exceed 40 million KRW. This is an amount that could lead to abandoning reports to avoid lawsuits from corrupt power holders.

If the amended law makes it harder for the media to fight against power, then the media must be guaranteed weapons to confront power accordingly. Media companies should be allowed to file counterclaims for punitive damages against power holders. A counterclaim, simply put, is not just a defensive response to a lawsuit but an offensive lawsuit claiming "I am also wronged." When a blocking lawsuit is filed against the media, instead of passive defense, the media would actively demand punitive damages. If punitive damages apply to counterclaims as well, those who file malicious lawsuits could be required to pay tens of millions of KRW in damages.

There is also a need for measures to preemptively block and control unfair media lawsuits. Journalists, once sued, must respond to lawsuits while watching the company’s stance, leaving little room to investigate the dark sides of power. Especially, once sued, the learning effect may cause fear of writing additional articles. To alleviate this burden, the introduction of a 'Frivolous Litigation Prevention Act' should be considered.

The UK’s Frivolous Litigation Prevention Act issues civil and criminal procedure prohibition orders when a party maliciously and persistently files lawsuits without reasonable grounds to harass the other party. Without court approval, filing lawsuits becomes impossible, and the list is published in the London Gazette. California in the United States adopts a method to regulate those who file frivolous lawsuits. Courts can issue pre-litigation injunctions prohibiting the filing of lawsuits upon application. Victoria, Australia, also enforces a similar Frivolous Litigation Prevention Act.

Opposition to the 'punitive damages system,' which is supported by a significant portion of the public, is meaningless. Instead, what is more necessary is a system that can actively respond to malicious lawsuits and legislation that preemptively blocks unfair blocking lawsuits.