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Appellate court overturns Pohang quake compensation ruling in Korea’s largest class-action lawsuit

Published: 13 May. 2025, 17:08 Updated: 13 May. 2025, 18:05

The Pohang Citizens Countermeasure Committee holds a press conference in front of the main gate of the Daegu High Court in Daegu on May 13 after losing the appeals case related to the Pohang earthquake. [YONHAP]

An appellate court on Monday overturned a lower-court ruling that had ordered the government and private companies to compensate victims of the 2017 Pohang earthquake, dismissing a claim brought by a group of Pohang residents in North Gyeongsang in Korea’s largest class-action lawsuit.

The ruling from the Daegu High Court’s Civil Division 1 reversed a lower court’s decision in November 2023 that had granted between 2 and 3 million won ($1,400 to $2,100) per person, slashing compensation to zero.

No negligence proven

The case centered on whether the 5.4 magnitude earthquake that struck Pohang on Nov. 15, 2017, and a subsequent 4.6 quake in February 2018, were triggered by water injection during the construction of a geothermal power plant.

“The key issues are whether the earthquake was an induced quake caused by water injection and, even if so, whether government agencies or companies involved were at fault,” the court said. “We acknowledge the quake was induced, but the evidence is insufficient to prove negligence.”

The lower court had ruled in favor of the plaintiffs, awarding 3 million won to those present for both major earthquakes and 2 million won to those who experienced only one.

The initial 111-person lawsuit ballooned to more than 50,000 plaintiffs following the 2023 decision, with estimated damages reaching up to 1.5 trillion won.

Planning Supreme Court appeal

The appeals ruling triggered a swift backlash in Pohang, where 499,881 plaintiffs or nearly 96 percent of the city’s population, had joined the legal action.

The civic group leading the lawsuit strongly objected after the ruling, with some members shouting, “500,000 Pohang residents are suffering. We condemn the court."

The Pohang Citizens Countermeasure Committee and the Nov. 15 Pohang Induced Earthquake Committee also criticized the ruling.

“We are appalled by this inconceivable verdict,” the committees said during a press conference outside the court. “The government has consistently tried to evade responsibility, and now the court has sided with that narrative.

“This was clearly a man-made disaster. The ruling ignores the pain and suffering of the citizens of Pohang.”

The groups added that they would file an appeal with the Supreme Court.

Pohang Mayor Lee Kang-deok also expressed disappointment.

Pohang Mayor Lee Kang-deok announces the city’s position on May 13 in the briefing room at Pohang City Hall in North Gyeongsang following the Daegu High Court’s dismissal of the appeal seeking compensation for psychological damage from the November 2017 Pohang earthquake. [NEWS1]

“This ruling fails to adequately reflect the reality of the severe psychological suffering experienced by citizens due to the earthquake,” Lee said in a statement. “It is deeply regrettable that the just decision all citizens had hoped for was not delivered.

"The government already acknowledged the link between the geothermal project and the quake. The court’s decision contradicts both public sentiment and legal expectations. We now have no choice but to await the Supreme Court’s final judgment."

The reversal stunned residents who had hoped the compensation would help with recovery or stimulate the local economy.

Hopes among residents were also deflated, from modest wishes to use the 3 million won to buy new appliances to broader expectations that the compensation would boost the local economy.

Kim Sung-kyu, who runs a restaurant in Pohang, also expressed disappointment in the court's ruling.

"Even if it wasn’t 3 million won, some level of compensation would have helped during these difficult economic times,” he said. “Most Pohang residents experienced the earthquake, a man-made disaster caused by the government’s mistake, but it feels like the government is avoiding responsibility.”

Division among residents

Some residents criticized the initial ruling itself, saying the state should not be expected to pay hundreds of millions in compensation for an unforeseen event.

“It’s true the quake may have been triggered by the geothermal plant, but no one could have predicted that,” said a Pohang resident who requested anonymity. “It’s too much to demand hundreds of thousands of won per person on top of the compensation already given.”

While the appeals court acknowledged the geothermal project induced the earthquake, it said the administrative failures cited in audits and investigations did not amount to civil negligence.

The Pohang Citizens Countermeasure Committee holds a citywide petition campaign and rally on the afternoon of Nov. 15, 2024 in Pohang, North Gyeongsang. [NEWS1]

The plaintiffs now plan to focus on gathering further evidence to prove a direct link between those failures and the disaster.

One key passage in the ruling said, “The inadequacies pointed out by the plaintiffs, the Board of Audit and Inspection and the fact-finding committee do not constitute civil negligence and cannot be considered the cause of the earthquake.”

“The government itself investigated and revealed to the public that the Pohang earthquake was an induced quake, yet the judiciary has yielded to the government’s false claims and deceptive rhetoric.” Mo Sung-eun, cohead of the citizens' committee, said. “We will fight to the end to ensure the Supreme Court delivers a proper ruling.”

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.
BY KIM JUNG-SEOK [[email protected]]