KT&G Corp. is facing a USD 2 billion damages suit from a former employee who claims the South Korean company did not properly reward him for inventing the world’s first heat-not-burn cigarette, reports The Korea Economic Daily.
Kwak Dae-geun, a former KT&G researcher, filed a civil lawsuit at a district court in Daejeon, the company’s headquarters, seeking KRW 2.8 trillion (USD 2 billion) in compensation for his invention. The compensation is the largest such claim by an individual in a legal action, excluding collective suits.
“The total amount of revenue earned and expected to be earned by KT&G through Kwak’s inventions, along with the losses incurred by the company due to the absence of overseas patents, was estimated to be 84.9 trillion won,” said Jaeyou Lawfirm, representing the plaintiff. “Of the total, Kwak demands 2.8 trillion won as his compensation.”
According to the report, KT&G vowed to actively respond to the suit, saying the company already rewarded him. “The company paid proper compensation for invention through a technology advisor deal and Kwak accepted it and agreed not to raise further issues,” said a KT&G official. “The patents are not plied to current products. We will take legal action if a retiree, who has already received compensation, continues to make unfair claims.”
Kwak, who joined KT&G in 1991, developed a prototype of heat-not-burn cigarette products in 2005. In July of that year, he applied for his first patent for the non-combustible tobacco device and in December 2006, he filed another patent for an upgraded product with an automatically controlled heater. In June 2007, he applied for a patent for a tobacco stick in June 2007, completing a heat-not-burn cigarette product set consisting of a heating unit, another device and a stick. The researcher reportedly left KT&G in 2010 as a part of the tobacco maker’s restructuring after it refused his proposal for further developments.
The compensation claimed by Kwak was based on estimates of the revenue KT&G was expected to earn from its patented technology during the 20-year patent term, what the company would have earned if it had filed patents abroad, and the revenue foreign competitors earned due to KT&G’s inaction on their patent infringements.