Damages Claim Case

In 2025, the Supreme Court of Japan finalized the appeal of a damages lawsuit filed by South Korean plaintiff Kim Hak-soon against Nippon Steel. The case, originally registered in 2017 (Heisei 29), was a retrial following landmark 2018 rulings by the Supreme Court of Korea. The Japanese court overturned lower court decisions, ruling that all individual compensation claims arising from wartime labor were definitively settled by the 1965 Treaty on Basic Relations between Japan and the Republic of Korea. The judgment rejected the plaintiff's claim for approximately 100 million yen in damages and unpaid wages for forced labor during Japan's colonial rule, citing state immunity principles and the finality of the bilateral agreement.

The Japanese Supreme Court unanimously dismissed the plaintiff's claim, ruling that the 1965 treaty completely and finally settled all reparation rights, and that South Korean court rulings to the contrary are unenforceable in Japan due to a breach of international comity.

The central dispute was whether the 1965 Japan-South Korea Claims Settlement Agreement extinguished the individual rights of former forced laborers to seek compensation directly from Japanese corporations, and whether Japanese courts were bound by foreign judgments that contradicted this interpretation.

The decision escalated diplomatic tensions between Tokyo and Seoul, leading to South Korean protests and a formal condemnation of the Japanese judiciary. It prompted the Yoon administration to reconsider asset liquidation procedures against Japanese firms, while further chilling bilateral trade talks and security cooperation for several months.