[1] The content of "the intention of joint processing", which is a subjective element for establishing a joint principal offender

[2] The elements and method of recognition of "public offering" in the co-principal, and the standard of determining whether a crime constitutes a joint crime by public offering

[1] Article 30 of the Criminal Act / [2] Article 30 of the Criminal Act

[1] Supreme Court Decision 2008Do1274 Decided April 10, 2008 (Gong2008Sang, 708) Supreme Court Decision 2015Do535 Decided October 29, 2015 (Gong2015Ha, 1850) / [2] Supreme Court Decision 2006Do1623 Decided December 22, 2006 (Gong2007Sang, 255) Supreme Court Decision 2010Do2905 Decided April 26, 2012 (Gong2017Do1538 Decided December 22, 2017)

Defendant 1 and one other

Defendants

Law Firm Hadong et al.

Seoul High Court Decision 2018No1642 decided January 7, 2020

The part of the lower judgment against the Defendants is reversed, and that part of the case is remanded to the Seoul High Court.

The grounds of appeal are examined.

1. The intent of co-processing in a co-principal is to be integrated for the purpose of committing a specific criminal act with the intention of co-principal and to shift his/her intent to practice by using another person's act (see Supreme Court Decision 2008Do1274, Apr. 10, 2008).

In addition, a public invitation of two or more accomplices who jointly process a crime is not required under the law, and it is sufficient that there is an implied communication on the joint execution of the crime directly or indirectly between the accomplices who intend to jointly commit the crime, and even if there is no direct evidence, it may be recognized by the circumstantial facts and empirical rules. In addition, the joint execution of a crime by a public invitation is possible not on the premise that all accomplices realize the elements of the crime, but on the premise that it can cooperate to strengthen the decision on the act. Whether the act constitutes a public invitation shall be determined by comprehensively taking into account the degree of understanding about the result of the act, the size of participation in the act, and the intent to control the crime (see Supreme Court Decisions 2006Do1623, Dec. 22, 2006; 2010Do2905, Apr. 26, 2012).

2. Review of the reasoning of the lower judgment and the evidence duly admitted reveals the following facts.

(1) After establishing Nonindicted Co. 2 (hereinafter “Nonindicted Co. 2”) in the United States, Nonindicted Co. 1 commenced sales and management business of virtual currency mining machines in Korea around September 2016. Nonindicted Co. 2 established Nonindicted Co. 3, Nonindicted Co. 4, and Nonindicted Co. 5 in order to manage the sales proceeds of the extraction season received from members or pay allowances, and established Nonindicted Co. 6 in order to install, manage, and operate the extraction machine. Nonindicted Co. 1 was a de facto controller of the said company.

(2) The business of Nonindicted Co. 2 may be divided into the business of selling mining equipment and the business of managing mining equipment. The business of selling mining equipment is the business of selling mining equipment through multi-level, and the business of managing mining equipment is the business of extracting virtual currency, which Nonindicted Co. 2 entrusted with mining equipment from buyers after selling the mining equipment.

(3) A multi-level marketing operator, such as Nonindicted Company 2’s mining equipment installation and operation business, membership management business, and the Defendants’ member recruitment business, was maintained and managed in a thorough separate manner, and the mutual communication or liaison was restricted.

(4) Nonindicted Co. 2 classified multi-level marketing salespersons into five groups, including Nonindicted 7 Group 8, Nonindicted 9 Group 10, Nonindicted 10 Group 11 (the head of the group), Nonindicted 12 and Nonindicted 13 Group, and Nonindicted 14 Group, and operated and managed the multi-level marketing organization (hereinafter “instant multi-level marketing organization”), and the said five groups exclusively sold the extraction machine.

(5) Defendant 1 commenced sales activities from around November 3, 2016 to around July 28, 2017. However, Defendant 1 was not the head of the group, but Nonindicted 9’s immediately following business operators. Although Defendant 1’s subordinate business operators were not the head of the group, the number of members directly recruited was seven, and approximately KRW 346,590,270, and approximately KRW 200,000,000 sales allowances were paid out of KRW 346,590,270, and mining allowances. Defendant 2 began sales activities from around October 27, 2016 to KRW 4,00,00,000, around May 27, 2017, Defendant 1 was not the head of the group but the head of the group, but the head of Nonindicted 10,367,570,000 won, and Defendant 2 was directly recruited from Nonindicted 10,570,000 won.

(6) Meanwhile, around March 2017, in accordance with the direction of Nonindicted 1, a steering committee was established in the instant multi-level marketing organization as part of the connections between Nonindicted Company 2 and the business operators, which made part of the highest number of business operators. Nonindicted 8, Nonindicted 16, Nonindicted 11, Nonindicted 14, Nonindicted 17, Nonindicted 9, Nonindicted 13, Nonindicted 18, and Nonindicted 19 were members of the steering committee. However, the said steering committee is merely limited to the role of delivering the guidelines of Nonindicted Company 2 to the business operators and delivering the business operators’ civil complaints to Nonindicted Company 2, and it did not directly affect the operation of Nonindicted Company 2. Moreover, the Defendants were not a member of the steering committee.

(7) The Defendants had experience in running a multi-level marketing system or door-to-door sales system in the past. The Defendants, a business operator belonging to the instant multi-level marketing organization, intended to induce investment and invite members. The Defendants directly opened a multi-level marketing room in their own name, and performed activities such as delivery of major official announcements on the part of Nonindicted Company 2, sharing of important information, solicitation of sale or investment, delivery of extraction instruments, introduction of lectures, exchange methods, membership registration, etc. However, the Defendants did not establish and operate a center or branch office corresponding to the subordinate organization of the instant multi-level marketing organization with either their own or upper-level business operators, and did not have any special position in Nonindicted Company 2. The Defendants did not receive any allowance or remuneration that is paid only to the upper-level business operators without being paid from Nonindicted Company 2 to the subordinate business operators.

3. Examining the above facts in light of the legal principles as seen earlier, it is difficult to view that the Defendants, as multi-level marketing salespersons of the instant multi-level marketing organization, participated in the crime through functional control by intention to jointly establish, manage, or operate a multi-level marketing organization without registration in excess of the activities as multi-level marketing salespersons, solely on the grounds that the Defendants served as a multi-level marketing salesperson of the instant multi-level marketing organization, the highest

Nevertheless, the lower court reversed the first instance judgment that acquitted the Defendants of violation of the Act on Door-to-Door Sales, Etc., which is the primary charge against the Defendants, and convicted them. In so determining, the lower court erred by misapprehending the legal doctrine regarding joint principal offenders, or by exceeding the bounds of the principle of free evaluation of evidence against logical and empirical rules

4. Therefore, without further proceeding to decide on the remaining grounds of appeal by the Defendants, the part concerning the Defendants among the judgment below is reversed, and the case is remanded to the court below for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Min You-sook (Presiding Justice)