LG Uplus False Advertising

For nearly 3 years (from 2019), the KFTC investigated LG Uplus’ for deceptively advertising its 5G mobile communications service as being the fastest at 20 Gbps (“Maximum Speed Ads”) and for unfairly advertising its 5G communications service speed as being faster than other service providers (“Comparative Speed Ads”). In 2022, the KFTC held its deliberation and ordered a rare re-investigation of the case including the allegation that LG Uplus advertised its 5G commercial network speed as 2.1 Gbps (“2.1 Ads”). The KFTC re-investigated LG Uplus in 2023 for 2.1 Ads, Maximum Speed Ads, and Comparative Speed Ads to determine if the ads were false, exaggerated or deceptive.

Lee & Ko represented LG Uplus throughout the KFTC investigation and deliberation process arguing (i) Maximum Speed Ads were standard advertising practices based on international standards, (ii) 2.1 Ads are not false, exaggerated or deceptive advertisements as the advertisements stated the “maximum” and “technical standard” of the commercial network speed and limitations of the technology, and (iii) Comparative Speed Ads were based on the results of objective transmission speed measurements, and clearly presented news reports and described the measurement process to demonstrate the comparison was not unfair or deceptive. Also, Lee & Ko actively argued the impact of the advertisements on consumers was insignificant, the investigation into 2.1 Ads showed the advertisement consisted of one word on the homepage requiring several steps to locate, and that an excessive increase in penalties would be disproportionate to the conduct. 

The KFTC accepted Lee & Ko’s arguments and described the 2.1 Ads as a “minor violation” without issuing an administrative fine. Lee & Ko’s successful representation resulted in LG Uplus being issued a reduced administrative fine of KRW 2.85 billion, significantly lower than the other telecom companies, which were fined KRW 16.82 billion and KRW 13.93 billion.