Hello, this is attorney Eom Sang-yoon of Cheongchul Law Firm.

As the internet platform market has grown, disputes over the unauthorized use of data have increased sharply, involving conduct such as (i) automatically collecting (crawling) data from a competitor's website and using it in one's own service, (ii) accessing another operator's lookup API (Application Programming Interface) and obtaining the resulting data, and (iii) developing a similar service using user-generated content (UGC) such as reviews, ratings and product information. The provision most frequently invoked in these disputes is the so-called "supplementary general clause on the unauthorized use of another party's achievements" under Article 2(1)(pa) of the Unfair Competition Prevention and Trade Secret Protection Act (부정경쟁방지 및 영업비밀보호에 관한 법률, the "Unfair Competition Prevention Act").

Against this backdrop, the Supreme Court recently ruled on a dispute over the unauthorized use of review data and an API in the university review service sector, once again clarifying the criteria for determining whether something qualifies as an "achievement" under subparagraph (pa) and where the burden of proof for its unauthorized use lies. In particular, the Court recognized the review data as an achievement while denying that status to the API, and reversed the lower court's finding of unauthorized use by the plaintiff, thereby setting an important benchmark for data misappropriation disputes. Today we review the key holdings of that decision and the practical implications to keep in mind.

Legal Principles on "Achievements" under Subparagraph (pa) of the Unfair Competition Prevention Act

Article 2(1)(pa) of the Unfair Competition Prevention Act was newly introduced by the amendment of July 30, 2013 (Act No. 11963), and defines as a type of unfair competition "an act of infringing another party's economic interests by using, without authorization and for one's own business, achievements created through that party's substantial investment or effort, in a manner contrary to fair commercial practices or the order of competition." It was introduced as a supplementary general clause designed to regulate new types of unfair competition not previously covered by the Act, in particular the unauthorized use of intangible achievements.

The Supreme Court has consistently held that, in determining whether something is an "achievement" protected under subparagraph (pa), courts must comprehensively consider (i) the reputation and economic value the result has acquired, (ii) the customer-attracting power embodied in it, and (iii) the weight and competitiveness the result holds within the relevant business sector. Furthermore, whether such an achievement was "created through substantial investment or effort" must be assessed specifically and individually, in light of the practices and realities of the industry to which the achievement belongs, and it must be possible to conclude that the economic interest infringed by the unauthorized use does not fall within the so-called public domain that anyone is free to use.

It is also settled law that, for conduct to constitute "use, without authorization and for one's own business, in a manner contrary to fair commercial practices or the order of competition" under subparagraph (pa), courts must comprehensively consider (i) whether the rights holder and the infringer are in a competitive relationship or are likely to be so in the near future, (ii) the content and fairness of the commercial practices and competitive order of the industry in which the claimed achievement arises, (iii) whether the achievement can be substituted in the market by the infringer's goods or services, (iv) the extent to which the achievement is known to consumers and traders, and (v) whether there is a likelihood of confusion among consumers or traders (see Supreme Court Decision 2019Da282449 of June 25, 2020; Supreme Court Decision 2025Da202970 of May 15, 2025).

Of particular practical importance is where the burden of proof lies. The Supreme Court has reaffirmed that the burden of proving whether the infringer used the achievement without authorization for its own business, in a manner contrary to fair commercial practices or the order of competition, rests on the party asserting that the infringer's conduct constitutes unfair competition under subparagraph (pa). In other words, a party claiming to have been infringed must prove all of the following: (i) the existence of its own achievement, (ii) that the achievement was created through substantial investment or effort, and (iii) that the infringer used it without authorization for its own business.

Facts and Holdings of the Recent Supreme Court Decision

This case arose between two operators providing university review services. The plaintiff filed a principal action seeking confirmation of the non-existence of liability for unfair competition and tort damages arising from its development and provision of its service, while the defendant filed a counterclaim seeking an injunction against the plaintiff's service and damages.

The lower court partially granted the defendant's counterclaim, holding that the plaintiff had used, in violation of subparagraph (pa), (i) the review data collected and processed by the defendant and (ii) the API allowing lookups of information stored on the defendant's servers, and recognized liability for damages accordingly. The Supreme Court, however, reversed and remanded on the following grounds.

1. Whether the review data constitutes an "achievement"

The Supreme Court held that the lower court was correct in finding the review data to be an "achievement" under subparagraph (pa), considering that the defendant had collected and processed it for its own service, together with the effort, cost and time invested, the resulting reputation and economic value, its customer-attracting power, and the weight and competitiveness of the review data within the university review service sector. This confirms that even user-generated content may be recognized as an achievement under subparagraph (pa) where an operator systematically collects and processes it and the result acquires substantial competitiveness in the market.

2. Whether the API constitutes an "achievement"

By contrast, the Supreme Court reversed the lower court's finding that the API constituted an "achievement" under subparagraph (pa), reasoning that (i) methods of querying server-stored data such as this API were already widely known in the university review service sector even before the defendant's service, (ii) the content of the API, including details such as its specific input and output parameters, did not differ materially from elements contained in ordinary APIs and amounted to no more than features any API performing similar functions would typically have, and (iii) notably, the lower court itself, in its analysis under subparagraph (cha) (unauthorized use of ideas), had held that "the API was an idea that the recipient already knew at the time it was provided, or that was widely known in the same industry," thereby treating the API as having low protective value, yet in its subparagraph (pa) analysis found it to be an "achievement" without any specific grounds — rendering the reasoning of the judgment self-contradictory. The Court also pointed out that the defendant itself had failed to specify or produce evidence of the content and degree of investment or effort it had put into the API.

3. Whether unauthorized use was established

The Supreme Court further reversed the lower court's finding that the plaintiff had used the review data and the API without authorization, noting that (i) the defendant failed to produce evidence proving that even a single item of the review data was actually used in the service developed by the plaintiff, (ii) the plaintiff asserted that it had collected review data directly and provided it to users without using the defendant's review data, and submitted evidence showing that it had gathered review data on its own through four events and incurred prize expenses, (iii) the plaintiff already possessed know-how from operating an online lecture review service since around 2016 and a corporate review service since around 2017, (iv) the plaintiff's new service was substantially similar in expression and structure to its own existing services, strongly suggesting that it had been developed on the basis of the plaintiff's independent technology and data, and (v) even though the plaintiff and the defendant compete in review services and their services look alike, the evidence submitted by the defendant alone did not reveal circumstances showing that the two services were substantially identical or similar to consumers or traders such that a likelihood of confusion could be found.

Ultimately, the Supreme Court held that the lower court had erred in its understanding of the legal principles on the burden of proof regarding whether something constitutes an "achievement" under subparagraph (pa) and on the establishment of unfair competition, reversed the judgment below, and remanded the case to the Seoul High Court.

Practical Implications

This decision offers the following important implications for unfair competition disputes involving intangible achievements such as data and APIs.

First, from the perspective of an operator asserting that its data or API has been infringed, it must be clearly understood that unfair competition under subparagraph (pa) is not established merely because the counterparty accessed its data or offers a similar service. For a claim under subparagraph (pa) to succeed, the claimant needs all of the following: (i) concrete materials showing that its achievement was formed through substantial investment and effort (personnel, cost and time invested), (ii) a showing that the achievement does not fall within the public domain, and (iii) direct evidence supporting the fact that the counterparty actually used the achievement without authorization. In particular, the Supreme Court identified "the absence of evidence proving that even a single item of review data was actually used" as the decisive ground for reversal. A party alleging data misappropriation should therefore secure and manage, in advance, evidence capable of identifying that its data was actually used in the counterparty's service (for example, distinctive typographical errors, watermark-like markers, or special identifiers).

Second, from the perspective of an operator seeking to develop a new service by collecting and using data, this decision provides important guidance on defense strategy by confirming that (i) widely known types of APIs and ordinary data lookup methods do not qualify as "achievements" under subparagraph (pa), and (ii) keeping records of one's own data collection and accumulation efforts (event materials, prize payment records, user participation logs, and the like) can serve as a powerful defense against allegations of unauthorized use. In particular, where an operator with prior business experience in a related field combines its existing know-how with self-collected data to develop a new service, this can weigh favorably as circumstantial evidence of independent development.

Third, operators preparing services that rely on crawling or API use should assess and manage risk in advance by examining (i) the possibility that the data to be crawled constitutes the counterparty's "achievement," (ii) whether the crawling method is contrary to fair commercial practices (for example, violation of the robots exclusion standard, breach of terms of use, or causing server load), (iii) whether their service stands in a substitutive relationship with the counterparty's service in the market, and (iv) whether there is a risk of causing confusion among consumers or traders. Because subparagraph (pa) is a supplementary general clause that reaches areas not previously governed by copyright law or individual intellectual property statutes, a complacent assumption that crawling is not unlawful in itself may leave an operator poorly defended if a dispute later arises.

That said, this decision is based on the specific facts of an individual case, and conclusions on whether an achievement is recognized or whether unauthorized use is established may differ depending on the nature of the data or API at issue, industry practices, and the infringer's development history and internal resources. Operators reviewing a dispute involving data or APIs would be best served by obtaining a comprehensive assessment of their business structure and the characteristics of the achievement at issue and, where necessary, seeking professional assistance to build a proactive response strategy.