Coupang files lawsuit against FTC’s $121 mn fine

Cho Hong-sun, Vice Chairman of the Korea Fair Trade Commission, announced on the 13th that Coupang and CPLB will face fines of 140 billion KRW and be referred to the prosecution. [Photo by Yonhap]

Coupang has filed a lawsuit contesting a 162.8 billion won ($121 million) fine imposed by South Korea’s Fair Trade Commission (FTC), following allegations that it manipulated its search ranking algorithm to favor its own private label (PB) products.

According to industry sources on Monday, Coupang and its PB products subsidiary CPLB submitted a lawsuit to the Seoul High Court on September 5th, 2024, seeking to overturn the corrective orders and fine imposed by the FTC.

The FTC’s ruling, which took effect as a first-instance decision, could be finalized through appeals to the Seoul High Court and potentially the Supreme Court if necessary.

“We will fully cooperate with the court and present our case for a fair judgment,” a Coupang spokesperson said.

The dispute dates to August 7th, when the FTC issued a penalty notice to Coupang that included a corrective order and a record fine of 1.6 trillion won, the largest ever levied against a Korean retailer. The FTC accused Coupang of manipulating its “Coupang Ranking” search algorithm to artificially boost sales of both PBs and directly purchased products. The commission found that Coupang applied additional ranking points to specific products or disregarded actual search results to push its own items to higher positions in the search rankings.