Court Rules Against State Health Insurer in Damages Suit Against Major Tobacco Firms | Be Korea-savvy

Court Rules Against State Health Insurer in Damages Suit Against Major Tobacco Firms

(image: Yonhap)

(image: Yonhap)

SEOUL, Nov. 20 (Korea Bizwire)A Seoul court handed down a ruling Friday against the state health insurer in its smoking-related damages suit with three major tobacco companies, citing no direct “legal” links between its increased financial burden and their businesses.

The Seoul Central District Court rejected the compensation request filed by the National Health Insurance Service (NHIS) against KT&G Corp., a leading South Korean cigarette producer with about a 63 percent market share, and the local units of two foreign companies — British American Tobacco and Philip Morris.

The court said the agency’s insurance spending represents the use of funds under a relevant law and is not attributable to any illicit acts by the defendants.

It added that it’s hard to acknowledge direct connections between the insurer’s expenditures and the tobacco firms’ businesses.

The NHIS sued the three firms in April 2014, seeking compensation of 53.7 billion won (US$48 million), the total spending from 2003-2013 by the state agency to cover costs for treating the patients of specific types of lung cancer and laryngeal cancer, presumed to be highly related to smoking, who smoked for more than 30 years and more than a pack a day for over 20 years.

The court also said the possibility can’t be ruled out that such diseases are caused by other factors, such as individual lifestyle, genetics and job-related characteristics.

Calling the decision “very shocking and regrettable,” Kim Yong-ik, president of the NHIS, said the agency was seriously considering lodging an appeal.

“(It’s) disappointing, as (we) had expected the court to hold (them) accountable for taking people’s lives, causing pains and increasing medical expenses,” he said, adding that approximately 62,000 South Koreans annually die of cigarette-related diseases.

Asked what was the most challenging thing about the case, Kim said, “There is a lack of social consensus to acknowledge the harmful effects of cigarettes,” unlike in some countries where a court ordered tobacco companies to pay for ailing smokers.

“We’ve been trying to have a legal acknowledgement of apparent damages of smoking but were only reminded that it is not an easy journey,” he said.

Kim said the agency will continue its efforts to publicize the harmful effects of smoking and raise social awareness about the issue.

South Korea has not seen a successful legal case against tobacco companies.

Less than a week before the NHIS filed the lawsuit, the Supreme Court threw out two damages suits brought on by 30 lung cancer patients and their families against the government and KT&G Corp.


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