A. The Plaintiff, a limited liability company established under the laws of the United States of America (hereinafter “U.S.”), concluded a contract with B, a domestic corporation, to grant B the right to use the patent 24 patents (hereinafter “instant patent”) and to receive USD 5,300,000 (hereinafter “instant royalty”) in return (hereinafter “instant contract”) between the Plaintiff and B around August 2013.

B. The patent license agreement entered into between the Plaintiff and B at the time of entering into the instant contract (hereinafter referred to as the “instant contract”) states that “the patent and patent application entered in Additional A and the right arising therefrom or arising therefrom” with respect to the instant patent, and the patent described in Additional A are 24 in total; among them, 21 patents registered in each of the world countries, including the United States, etc.; and three patents registered in the Republic of Korea (referring to those entered with registration number) among the registered patents.

C. B Considering that the pertinent royalty constitutes a domestic source income subject to withholding, B withheld corporate tax of KRW 852,478,500 and paid to the Defendant by applying the limited tax rate of 15% under Article 14(1) of the Convention between the Republic of Korea and the United States of America for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and the Encouragement of International Trade and Investment (hereinafter “Korea-U.S. Tax Convention”).

Of the instant royalty, the Plaintiff did not have to pay for the use of the patent right that was not registered in the Republic of Korea, and thus, USD 662,50 (US$ 5300,000 x 3/24) divided according to the number of patents is only domestic source income, and the legitimate tax amount is only KRW 106,559,813 (=852,478,500 x 3/24 x less than won). The Plaintiff asserted that the Defendant is only KRW 745,918,687 x 852,478,50.