Revitalized Transitional Justice and Corporate Accountability for Korean Wartime Forced Labor in Japan

By: Professor Steven Nam

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Photo: Michael Coghlan

In recent years, and during 2015 in particular, the transitional justice movement for Korean victims of forced labor in World War II era Japan has gained renewed momentum. Between 1999 and 2009, Korean plaintiffs tried to claim damages against the Japanese corporation Mitsubishi Heavy Industries (“MHI”) for wartime forced labor, but both the Japanese and Korean courts repeatedly denied restitution. However, in May 2012, the Supreme Court of Korea issued a landmark decision against MHI, holding that to deny the forced labor victims recovery violated Korea’s Constitution and international legal norms. With this decision, the Supreme Court of Korea overturned a Korean appellate court’s ruling and expressly negated decades of decisions out of Japan, including those by the Hiroshima District Court, the Hiroshima High Court, and the Supreme Court of Japan – all of which cited the expiration of the statute of limitations, among other reasons, for rejecting the plaintiffs’ claims. In the wake of this 2012 decision, in April 2015, the Korean victims and their families filed a class action in Seoul against MHI and other Japanese corporate defendants – seeking unpaid wages, damages, and compensation for the wartime labor. Along with local Korean counsel, the U.S. law firm Kohn, Swift & Graft, which notably helped secure a $7.5 billion settlement with the German government and Austrian companies for forced labor Holocaust victims, has agreed to represent these Korean class action plaintiffs.

This piece presents a brief history of the litigation brought by Korean victims of forced World War II labor at MHI and examines how the May 2012 Supreme Court of Korea decision marks a significant turn – not only for the Korean victims’ hopes for redress, but also for improved relations between Seoul and Tokyo.

Background on Korean Forced Labor in World War II Japan

Japanese and Korean scholars conservatively estimate that the total number of Korean forced laborers in Japan between 1939 (when national conscription began) and 1945 totals between 700,000 and 720,000, with some estimates of up to 1.2 million or more. Of these laborers, the uneducated typically were assigned to work at mines and heavy construction sites, while those with some schooling – like the MHI plaintiffs – worked in factories. Although workers signed two-year “contracts,” purportedly entitling them to wages and compulsory savings, MHI factory managers ultimately pocketed the payments and forcibly extended the laborers’ two-year agreements. To compel this factory labor, MHI management garnered the backing of local police and coerced workers with hunger, fear, torture, and murder. Indeed, between just 1944 and 1945, out of the estimated 700,000 Korean civilian employees who were conscripted for forced labor by Japanese companies, approximately 60,000 were reported dead after the war.

Early Litigation in Japan – Limited Success

On December 11, 1995, plaintiff Pak Chang Hwan and five other Korean victims of forced labor filed a lawsuit in the Hiroshima District Court against the Japanese government and MHI, seeking ¥66 million (approximately US $550,000) in outstanding wages, damages, and compensation for forced labor at the Hiroshima MHI factory from September 1944 to August 1945 and for illness linked to the atomic bomb. By May 1998, forty-six additional plaintiffs had joined the lawsuit, increasing the case’s claim to roughly ¥530 million (approximately US $4.3 million).

The Hiroshima District Court dismissed the lawsuit on March 25, 1999. The court acknowledged that Japan had perpetrated forced transport and forced labor, but noted that these violations occurred while the Meiji Constitution was in effect. The Meiji Constitution, in place by the Empire of Japan from 1890 to 1947, prohibited citizens who were injured by official Japanese action or policy from suing the state for damages. This, the Hiroshima District Court reasoned, absolved the current Japanese government of the responsibility to compensate the victims of the forced transport and labor. As for MHI, the court held that the twenty-year statute of limitations had expired and that the company too had no responsibility to compensate the Korean plaintiffs.

Following an appeal by the plaintiffs, on January 19, 2005 the Hiroshima High Court ordered the government of Japan to compensate only for the plaintiffs’ illness linked to the atomic bomb; however, it rejected claims for damages stemming from MHI’s use of forced labor, upholding the district court’s statute of limitations rationale. On November 1, 2007, the Supreme Court of Japan affirmed the Hiroshima High Court’s ruling after an appeal by the Japanese government.

Litigation in Korea – Change in Course for Individual Actions

The Japanese Supreme Court’s November 2007 decision was, at best, a partial solution for the Korean victims, for MHI, and for the Japanese and Korean governments. On February 3, 2009, in the spirit of comity, the Busan High Court in Korea approved the final judgment of the Supreme Court of Japan and dismissed identical claims that had been filed after the Hiroshima District Court dismissal. Showing deference to the Japanese courts, the Busan High Court held that “even if [Korean] law is applied, Plaintiffs’ tort damages claim right expired under the statute of limitations” per the Japanese judgments that tolled the statute of limitations until 1965.

The Busan High Court in Korea relied on international interpretations of the 1965 Korea-Japan Treaty on Basic Relations, which normalized relations between Korea and Japan two decades after World War II’s conclusion and contained a Claims Agreement – purportedly resolving outstanding and future claims between citizens of the two countries. Prior to 1995, when the Korean plaintiffs filed their original lawsuit in Japan, it had been “a generally accepted view within [Korea] that issues of the [Korean] citizen’s individual claim right against Japan or Japanese citizens,” in addition to state claims, had been comprehensively resolved by the Claims Agreement – absolving Japan and Japanese citizens of responsibility for outstanding and future claims. However, the Busan High Court asserted that by the time the plaintiffs filed suit in 1995, this Korean policy had changed; private individual claims, in contrast to claims by the state, were not barred. Indeed, in January 2005 previously confidential negotiation documents detailing this policy shift were finally disclosed to the public and in August 2005 a Korean public-private joint committee published its official view that individual private actions “in which Japanese state powers had been involved or related to the colonial rule [were] not addressed in the Claims Agreement.”

Recent Developments and Renewed Hope for Resolution

In the three-plus years following the 2012 decision from the Supreme Court of Korea, district and appellate courts in Busan, Seoul, and Gwangju have ordered MHI and other Japanese companies that used forced labor during World War II to compensate individual Korean plaintiffs. MHI and other Japanese companies, along with Tokyo, have protested and filed appeals to the Korea Supreme Court, insisting that the compensation claims have already been laid to rest. However, the most striking development came in April 2015 when 1,004 Korean forced labor victims and family members filed a class action in Seoul District Court. Under the banner of the civil-society organization known as Asia Victims of the Pacific War Families of the Deceased Association of Korea, the class action named MHI and seventy-one other Japanese companies, including large conglomerates such as Mitsui and Nissan. The plaintiffs seek compensation totaling 100 billion won ($92.3 million), the largest claim in a Korean wartime forced labor lawsuit to date.

On the day the lawsuit was filed, one hundred of these Korean class plaintiffs held a press conference, echoing the substance of the 2012 Korean Supreme Court decision. Asserting that the “issue over private claims against Japan regarding the Korea-Japan Treaty is the biggest challenge to the peaceful settlement of historical issues between the two countries,” the plaintiffs criticized the persisting view that individual claims were barred under the 1965 Korea-Japan Treaty and the Claims Agreement.

In July 2015, two noteworthy transitional justice developments further brightened the prospects for resolution of individual claims against MHI and the Japanese government. MHI first apologized to U.S. prisoners of war who had been used as slave laborers during World War II; then, in the following week, the company proposed a settlement with Chinese forced laborers in Chinese courts that would include an apology and a large compensation package. Described as a catalyst for improved ties between Beijing and Tokyo, these developments seem to have increased the likelihood of a bilateral summit featuring China and Japan in the near future; a similar compensatory and symbolic deal between Korea and Japan would likely boost Seoul-Tokyo ties.

Indeed, despite the issue’s complex historical and legal background, developments since the Korean Supreme Court decision in 2012 have galvanized hope for a peaceful resolution of potential outstanding individual claims. Indeed, in recent years and months, influential stakeholders in both Korea and Japan, from the courts to civil society, have revitalized the transitional justice process – recasting corporate accountability to shape a viable resolution that evaded Japan and Korea for decades. This opportunity, if embraced by all parties, could give rise to effective redress for the wartime forced laborers, their families, and their advocates; provide closure for the culpable companies; and represent a permanent step towards rapprochement for Japan and Korea.

Steven Nam is a Visiting Professor of Law at UC Davis School of Law – with academic interests combining transitional justice in the Asia-Pacific, corporate accountability and human rights, the U.S.-Japan-South Korea trilateral relationship, and foreign policy in the context of liberalism.

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