Law Firm LLC et al., Counsel for defendant-appellant

Attorney Han Chang-ho

Law Firm LLC et al., Counsel for defendant-appellant

Attorney Park Jong-dae, and Kim Jong-ray

2. The costs of the lawsuit are assessed against the defendant.

A. The Plaintiff published each curriculum book (hereinafter “each curriculum book of this case”) as a publishing company publishing the stamp of approval used at elementary schools, etc., and as indicated in the separate sheet No. 1, the price of each curriculum book of this case was determined as indicated in the separate sheet No. 1.

B. On May 15, 2015, the Defendant ordered the Plaintiff to adjust the price of each of the curriculum books of this case at the price stated in the annexed sheet 1 column for the order of price adjustment, based on Article 3(2)1 of the Regulations on Curriculum Books (hereinafter “Rules on Textbooks”) that allows the Plaintiff to issue an order for price adjustment via the Deliberation Council for Curriculum Books (hereinafter “Deliberation Council”) where the price of each of the curriculum books of this case is likely to be determined unfairly (hereinafter “instant disposition”).

C. The Plaintiff filed an objection with the Defendant pursuant to Article 33(4) of the Textbooks Rules, but the Defendant decided not to accept the said objection on August 11, 2015.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1 and 2, the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

1) substantive illegality

A) As to each of the instant curriculum books, there is no concern that the “price determined by the requirements for an order for price adjustment” under Article 33(2) of the Textbooks Regulations is to be determined unfairly, and thus, the grounds for the instant disposition are not recognized.

B) In the instant disposition, the Defendant’s method of calculating the price according to the standard number of copies as set out in the “Notice of Details for the Order to Adjust Approved Books Price” (Public Notice No. 2015-49, hereinafter “Public Notice of Education”) is unreasonable.

C) In addition, the instant disposition is unlawful in that it is against the principle of trust protection, the principle of self-determination of administration, the principle of proportionality, etc., and is made based on Article 3(2) of the Regulations on Textbooks and the notice of this case.

2) procedural illegality

A) There is an error of law in examining the appropriateness of the price of each curriculum of this case only formally at the deliberation council held for the instant disposition.

B) In addition, the Defendant violated the duty of presentation of reasons for the disposition by failing to state the specific reason for the disposition at the time of the instant disposition, the basis for calculation of the order price.

(b) Related statutes;

Attached Form 2 shall be as shown in attached Table 2.

C. Determination

1) The requirements for a price adjustment order and whether the price is likely to be determined unfairly

A) Article 29(2) of the Elementary and Secondary Education Act provides that "the scope, writing, authorization, approval, publication, supply, selection, and price assessment, etc. of the curriculum books shall be prescribed by Presidential Decree." Accordingly, Article 33 of the Curriculum Rules provides that "the price of the authorized book and the approved book shall be determined by the publishing company which entered into an agreement with the author" under paragraph (1) of the same Article. Paragraph (2) of the same Article provides that "Where the price of the authorized book and the approved book is likely to be determined unreasonably due to any of the following reasons, or the publishing company fails to reflect the cost invested in the development of the book even though the price was fully collected by the publishing company, the Minister of Education may issue an order to adjust the price through the Deliberation Committee." For each reason, where the ratio of manufacturing cost who did not actually occur in the process of the development and manufacturing of the book among manufacturing cost is at least 15/100, 2.0 or the cost of determining the price or the cost of the curriculum (Article 32(3) of the publication clause).

In light of the language and text of the instant provision, the legislative intent, and the following circumstances, etc., in order to issue a price adjustment order on the grounds that the price of the authorized book and approved book is likely to be determined unfairly due to the reasons stipulated in the instant provision, it shall be separately recognized that the relevant curriculum book falls under the reasons stipulated in each subparagraph of the instant provision, and that there is a concern that the price might be determined unfairly due to such reasons as well as the possibility that the price would be determined unfairly. In this case, the fact that the grounds stipulated in each subparagraph of the instant provision are recognized with respect to the curriculum subject to the price adjustment order, and that the price of the curriculum book is presumed to have been determined unfairly, cannot be deemed to be the presumed relation. Accordingly, the defendant must prove that the grounds stipulated in each subparagraph of the instant provision are recognized with respect to each curriculum of the instant case, and that the price might be determined unfairly (see Supreme Court Decision 2015Du6020, Jan. 31, 2019).

(1) Whether the price is likely to be determined unfairly shall be determined by comprehensively taking into account excessive benefits of the publishing company of the inspection and approved books, increase in the consumer’s economic burden, etc. The determination is difficult to readily conclude that the publishing company gains excessive benefits at all times or increases the consumer’s economic burden on the grounds that the grounds prescribed in each subparagraph of the instant provisions exist.

② It is difficult to see that the correlation between the reasons under each subparagraph of the instant provision and the price actually determined or desired by the publishing company is clear. Despite the existence of the reasons under each subparagraph of the instant provision, the price determined or desired by the publishing company may not be objectively unreasonable from the perspective of objective.

B) Meanwhile, in full view of the following: (a) publishing companies that publish the textbook and the main purpose of pursuing profit-making as the subject of freedom of business activities; (b) under the inspection and approval system, there are various types of textbooks per subject; and (c) one textbook is adopted and ordered after comparing and examining the contents and level of textbooks and the appropriateness of prices in various levels of schools; (d) textbook markets also seem to operate the minimum market economy principle, which is the principle of demand and supply; and (c) the purpose of the Ministry of Education introducing the textbook price autonomy system and promoting the expansion of the percentage of the approved book among the total textbooks by allowing publishing companies to input time and effort for the textbook production, thereby inducing students to produce a high-quality textbook that can reflect various demands of students; and (e) the degree of price increase by the State’s involvement in the curriculum books even if the curriculum books have characteristics of public nature, it is reasonable to reasonably recognize that the price increase rate of the curriculum books could have an excessive impact on the average price increase in the curriculum books by taking into account the price increase in the curriculum books and the National price increase.

C) As to the instant case, the Defendant asserted that the price of each of the instant textbooks might be determined unfairly, and the Defendant calculated the desired price by appropriating the rate of price increase compared with the average rate of price increase in the textbooks and guide books according to the revised curriculum in 2007, compared to the average rate of price increase in the last three years and the national gross income increase rate per capita for the last three years, and 2. The Defendant calculated the desired price by appropriating the examination fee, etc. which is not included in the cost, or by appropriating the correction review fee at a price higher than the unit price set by the Defendant.

However, the following circumstances acknowledged by adding the aforementioned evidence and Gap evidence No. 21 to the purport of oral argument, namely, ① in the case of textbooks and guide books, it is unfair to compare the prices of textbooks and guide books according to existing curriculum despite the revision of curriculum in the case of textbooks and guide books. As seen earlier, merely because the rate of price increase for textbooks is higher than price increase rate, etc., the mere fact that the above price increase rate of textbooks cannot be determined unfairly. ② According to Articles 13 and 16 of the Curriculum Rules, a person who applies for the inspection and authorization shall pay the examination and authorization fees determined and announced by the defendant considering the number of pages of the application book, degree of difficulty in the subject examination, and the cost of authorization, and this is not returned. As long as the above fees are inevitably required for publishing approved books, it cannot be readily concluded that the price might be determined unfairly only because the publishing company reflected it in calculating the desired price for the curriculum book. ③ The defendant's submission of the evidence to the extent that there is no possibility that the defendant's submission of the above cost is unreasonable.

2) Whether the method of price calculation prescribed in the instant public notice is unlawful

A) The public notice of this case prescribes that the "standard number of copies" should be calculated by dividing the total amount of manufacturing costs and all costs by the "standard number of copies" and multiplying the average number of copies for the last three years by the consumer price inflation. In the event that the actual number of copies is not less than the average number of copies, the standard number which reflects the actual number of copies issued (the calculation by deducting 18.5% of the number of copies actually issued and the number which applies the annual average number of students to the actual number of copies issued) and the standard number which applying the average number of copies (the calculation by deducting the average number of copies applied by the average number of copies by 3.5% and the number which applies the annual average number of students to the relevant number by the number of copies) which apply the average number of copies (the calculation by deducting the number applied by the average number of copies by the average number of 3.5% and the number applied by the average number of copies).

B) However, in determining the standard number of copies with respect to publishing companies whose actual number of copies is less than the average number of copies, the Defendant grants 3.5% incentives based on average number of copies to the former, while the latter gives 18.5% incentives to the actual number of copies reflected in the actual number of copies issued without reasonable grounds, it constitutes arbitrary discrimination, and the calculation of adjustment price based on such standard number of copies is unlawful (see Supreme Court Decision 2016Du65725, Jan. 31, 2019).

D. Sub-committee

Therefore, the instant disposition against each of the instant curriculum books is not recognized as the grounds for the instant disposition, and it is unlawful to calculate the ordered price of the instant disposition based on the instant notice, and the instant disposition ought to be revoked in an unlawful manner without any need to further examine. Furthermore, as long as the Plaintiff’s primary claim is accepted, the preliminary claim is not examined.

3. Conclusion

Therefore, the plaintiff's primary claim is reasonable, and it is so decided as per Disposition.

Judges Kang Jae-sung

Judges Lee Gyeong-soo

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.

A person shall be appointed.