South Korea: Owners sue government for shutting down their small businesses

A group of small business owners in South Korea recently filed a case against the government for their financial losses. They have become more determined to sue as the social distancing measures in the country were extended starting Jan. 4.

Reason for the legal action of the business owners

As per the Korea Joongang Daily, some lawyers said that over 500 individuals have banded together and filed lawsuits to seek compensation as their businesses are not able to continue or earn enough because of the implemented stricter rules on COVID-19.

As social distancing and other protocols are implemented, few people are going out to buy or visit stores. While this is for everyone’s wellness, small businesses are suffering since they are not earning anything for the lack of customers.

It was said that hundreds more have expressed their interest in joining the lawsuit. Some of the businesses that are suing the government include indoor gyms, private cram schools, fitness centers, taekwondo schools, and more. These were badly affected due to business restrictions that were put into effect in the past weeks as the cases of COVID-19 surge again in South Korea.

In any case, the government announced the past weekend that three main cities, including Incheon, Seoul, and Gyeonggi, will maintain the social distancing scheme and were given the highest level of restriction. This stricter protocol will be in effect until Jan. 17, and small businesses fear they will not have anything left once the scheme is lifted.

Currently, fitness centers were forced to close, and training halls can only open with a very limited number of students, with nine as the maximum count. Review schools or Hagwon should also maintain the nine-person limit. Eating in internet cafes is also banned, and they are only allowed to open at certain times.

The legal action taken

Now, as reported by Korea Joongang Daily, at least 187 hagwon owners filed a lawsuit against the government in December, and last week, 163 more have joined. Each of them is asking for KRW5 million or $4,600 in compensation for their losses.

On Jan. 6, 153 indoor gym owners and fitness centers have also come forward and sued the government and demanding the same amount as the hagwon owners. Internet cafe and indoor golf range owners are said to be preparing to file a case as well.

“For small business owners like us, it’s a matter of life or death,” Nam II, head of a kickboxing center, said. “Government officials are just going around slapping us with business shutdown orders without considering the reality.”

Meanwhile, similar cases were also filed in the U.S. already. A lawyer sued New York on behalf of small businesses in the city. The New Yorker reported that Atty. James Mermigis already filed over half-dozen lawsuits against NY, NY city mayor, and the governor. He sued them as businesses were forced to close during the pandemic.