South Korea’s major e-commerce entity, Coupang, is facing a class-action lawsuit from investors in a US court over alleged violations of securities laws. The lawsuit is in relation to a significant cybersecurity breach that led to the exposure of personal information of over 33 million customers.
The class-action lawsuit, instigated last week in a California federal court, accuses Coupang, its CEO and chairman, Bom Kim, and its CFO, Gaurav Anand, of misleading investors about the company’s data security measures and failing to disclose the breach promptly.
Coupang, often referred to as South Korea’s answer to Amazon, expressed regret over the unauthorized data access that led to the breach of personal information last month. Following the aftermath of the breach, Park Dae-jun, CEO of the subsidiary Coupang Corp, decided to step down earlier this month.
In response to the breach, Coupang has stated its intent to enhance its security measures to prevent any future data leaks.
As of now, Coupang and the legal counsel representing the investor who initiated the lawsuit on the 18th of December have not offered any comments.
Coupang, a global operation with offices in California and other cities across the US, dominates South Korea’s e-commerce market. The company offers services ranging from same-day delivery to video streaming and food delivery. The recent data breach has triggered investigations in South Korea.
According to the lawsuit, Coupang discovered on November 18th that a former employee had illicitly retained access to its internal systems for several months. As a result, customer names, email addresses, delivery addresses, and some order histories were compromised. Coupang has assured that no payment details or login credentials were exposed in the breach.
The lawsuit also alleges that Coupang failed to disclose the breach in compliance with US securities rules in a timely manner.
The lawsuit further contends that Coupang’s US regulatory filings downplayed the company’s susceptibility to cyberattacks and exaggerated its protective measures. The plaintiff is seeking damages for investors who acquired Coupang securities between August 6th and December 16th.
What are the allegations raised against Coupang in the class-action lawsuit?
The lawsuit alleges that Coupang misled investors about its data security measures and failed to disclose a major cybersecurity breach promptly.
What was the impact of the data breach?
The breach led to the unauthorized exposure of personal information of over 33 million customers, including names, email addresses, delivery addresses, and some order histories.
What is the relief sought in the lawsuit?
The plaintiff is seeking damages for investors who acquired Coupang securities between August 6th and December 16th.
