The defendant has operated the clothing sales business and coffee shop (hereinafter referred to as the “instant store”) with the trade name “F” in Chungcheongnam-si.

Around January 2018, the Defendant (i.e., KRW 30 million) transferred the instant store business to the Plaintiff (i.e., KRW 10 million). Accordingly, the Plaintiff paid a total of KRW 30 million to the Defendant (i.e., KRW 5 million on January 19, 2018).

On January 22, 2018, the Plaintiff entered into a lease agreement on the building of the instant store with the owner of the building of the instant store. On February 1, 2018, the Plaintiff completed business registration with the trade name “G” as to the instant store.

On March 28, 2018, the defendant completed business registration concerning clothing, small goods retail trade in the name of "D" from C and the first floor of Chungcheong City C and sold imported clothing and props.

【In the absence of dispute, the Plaintiff’s assertion as to the grounds for claim as to the respective descriptions of Gap’s Nos. 1 through 4, and the grounds for claim as a whole of the pleadings, the Defendant is running the same kind of business after completing business registration with the trade name “D” from March 28, 2018 after transferring the instant store to the Plaintiff from March 28, 2018.

As such, the Defendant’s act violates Article 41(1) of the Commercial Act, the Defendant is not obliged to engage in the same kind of business until January 31, 2028, and to pay money in proportion to KRW 10,000 per day if it discontinues its business as an indirect compulsory performance.

Judgment

On the other hand, according to the determination of the claim for prohibition of business, the defendant, under Article 41 (1) of the Commercial Act, cannot conduct the same kind of business as the store of this case at the Chungcheong City for ten years, but it can be recognized that the defendant violated the obligation of prohibition of competitive business under the Commercial Act by operating the same kind of imported goods and small goods sales business as the store of this case. Thus, on January 21, 2028, the defendant sought a prohibition until January 31, 2028.