Defendant 1 and one other

Defendants

Park Jong-kin, Yang-kin iron (prosecution), and Sung-Jin-Jin (public trial)

Law Firm LLC et al.

Seoul Northern District Court Decision 2016 High Court Decision 2261, 2333 (Consolidated) Decided December 14, 2017

All appeals by the Defendants are dismissed.

1. Summary of grounds for appeal;

A. misunderstanding of facts or misunderstanding of legal principles (as to a violation of the Tobacco Business Act)

1) Joint assertion by the Defendants

○ “The amount of solution containing nicotine” made by mixing nicotine’s concentration, professional sirenglycol, vegetable glycerine, and fluorial fluorine does not constitute “tobacco” under the Tobacco Business Act. The lower court determined otherwise is in violation of the principle of prohibition of analogical interpretation.

According to the interpretation of the current law that regards the nicotine of ○ high concentration as tobacco, the Defendants’ subdividing the dilution of high concentration nicotine with a certain percentage cannot be deemed as an act of tobacco manufacturing.

2) Defendant 1

The above defendant heard the fact that he was not prosecuted by the Sung-nam Branch of the Suwon District Prosecutors' Office against the non-indicted 1 corporation (the non-indicted corporation) and thought that it was not punished even by creating nicotine-containing content. The above defendant did not have the awareness of illegality.

3) Defendant 2

According to the Enforcement Decree of the Tobacco Business Act and the Enforcement Decree of the same Act, the criteria for tobacco manufacturing license are set only on the basis of tobacco tobacco, and there is no separate criteria for permission on the electronic tobacco containing nicotine. In such a situation, it is against the principle of no punishment without the law to rate the above defendant's act as a violation of the Tobacco Business Act.

○ The e-tobacco of this case was produced by Defendant 1 alone, and Defendant 2 did not manufacture the e-tobacco of this case in collusion with Defendant 1. Although Defendant 2’s act can be seen as constituting a violation of the Tobacco Business Act, the Defendants did not violate the Tobacco Business Act as a co-principal.

B. Unreasonable sentencing

The sentence of the lower court (Defendant 1: 2 years of imprisonment, Defendant 2: imprisonment with prison labor: one year and six months) is too unreasonable.

2. Judgment on the misunderstanding of facts or misapprehension of legal principles by the Defendants

A. Whether the “amount containing nicotine” falls under the “tobacco” under the Tobacco Business Act

In the court below's assertion as to the above grounds for appeal, the court below rejected the above assertion in detail by stating in the court below's decision the above argument under Item 1-B (1) under the title "the judgment on the defendant's assertion". The court below's decision is just and acceptable, and there is no error of misunderstanding of facts or misunderstanding of legal principles as alleged by the defendants.

B. Whether the act constitutes “production” of tobacco

The lower court determined that the Defendants made goods with high-value added by applying the technology and know-how, such as nicotine’s trade secrets, and thereby making them possible to inhale steam by itself, but the amount of nicotine’s solution made by the Defendants is not possible. The lower court determined that it is reasonable to view it as manufacturing tobacco, and that it is not a simple mixture.

In addition to the above circumstances, the court below and the court below found the following circumstances acknowledged by the evidence duly adopted and investigated by the court below: ① The amount of nicotine contained by the defendants, ② The amount of nicotine contained by the defendants; ② The amount of nicotine contained by the protruding Glyml; coloring lux, lux, lux, and re-mix water again; vegetable gly lux, coloring lux, lux, and fluor, and fluor, which are recorded in water and alcohol; 3 times of manufacturing explosives and cosmetics; the Defendants made a mixture of ingredients and fluorics and fluorics according to the ratio of additives mixed with the defendants; ② how the ratio of the defendant 2 is mixed with the investigative agency; ② how the defendants 3 times of luxics and fluorics were mixed with other people; and the defendants' 3 times of luxics and fluorics are not required to make a variety of gluorics in the court below.

C. Whether the Defendants did not recognize the illegality of the act of manufacturing tobacco

1) The judgment of the court below

The lower court determined that: (a) the Tobacco Business Act was amended on January 21, 2014, and it became clear that the electronic tobacco constitutes tobacco stipulated in the aforesaid Act; (b) the Defendants, as a matter of course, have to know or could have been sufficiently aware of the fact that the Defendants, who manufactured the electronic tobacco, were in charge of non-indicted 1 corporation’s act of non-indicted 1 corporation, cannot be deemed as having justifiable grounds for not recognizing the illegality of the Defendants; and (c) the disposition of non-indicted 1 corporation’s act was related to the manufacture of the electronic tobacco on the electronic amount of the non-indicted 1 corporation from July 2010 to January 21, 2014; (d) there was no doubt as to whether the electronic tobacco constitutes tobacco under the Tobacco Business Act, but thereafter, it is not doubtful by that Act; and (e) there was no doubt as to the Defendants’ assertion that the owners of the electronic tobacco agency business could not manufacture the nicotine electronic tobacco containing the amount of nicotine tobacco in Korea (Evidence evidence and evidence).

2) Determination of the immediate deliberation

A) Relevant legal principles

Article 16 of the Criminal Act provides that an act of misunderstanding that one’s own act does not constitute a crime under the law shall not be punishable only when the misunderstanding has a justifiable reason. This generally purports that an act of misunderstanding that one’s own act does not constitute a crime but does not constitute a crime under the law in light of his/her special circumstances, and that an act of misunderstanding is not punishable if there is a justifiable reason for such misunderstanding. The justifiable reason in this context lies in the opportunity to examine or inquire about the possibility of illegality of one’s own act by fully performing his/her intellectual ability and to make a serious effort to avoid it, and should be determined depending on whether the act of misunderstanding is likely to have been aware of illegality. The degree of efforts necessary for recognizing illegality ought to be determined differently depending on the circumstances of the act of misunderstanding, the offender’s individual awareness ability, and the social group to which the actor belongs (see, e.g., Supreme Court Decision 2005Do3717, Mar. 24, 2006).

B) Determination

Comprehensively taking account of the following circumstances acknowledged by the lower court and the evidence duly admitted and investigated by the lower court, it cannot be deemed that the Defendants thought that the manufacturing of nicotine solution would not be punished, or that there was a justifiable reason to believe that such mistake was made.

① In light of the court below’s examination process, Defendant 1 responded to the defense counsel’s question, “I either personally identify or one prepared to obtain permission for tobacco manufacturing business according to the revision of the Tobacco Business Act,” and “I asked about a large number of questions to the Planning and Finance Ministry” (trial No. 512 pages), Defendant 1 consistently responded to the police to the effect that the Ministry of Strategy and Finance, which is the competent department in charge of permission for tobacco manufacturing business, arbitrarily mixs and dilution letters in the Republic of Korea from September 2012 to November 2014, the act of importing nicotine solution constitutes tobacco manufacturing business, and the person who intends to conduct tobacco manufacturing business, is required to obtain permission for tobacco manufacturing business.” In light of the evidence record, Defendant 1 appears to have consistently known that Defendant 1 made nicotine including nicotine in the Ministry of Strategy and Finance.

② Defendant 1 and Defendant 2 appear to have prepared the “contract for the consignment of manufacture” around December 18, 2014. Article 1 of the said contract provides that “The purpose of Defendant 2 was to entrust Defendant 1 with the manufacture of an electronic tobacco.” Defendant 1 stated that Defendant 2 was entrusted with the manufacture and sale of an electronic tobacco by Defendant 2. The record of evidence was 1457 pages) and Article 2 of the said contract provides that “Defendant 1 shall have the manufacturing facilities meeting Defendant 2’s demand” (Evidence No. 1457, 1458 pages). In light of the language and text of the contract between the aforementioned Defendants, it is reasonable to view that the Defendants perceived that Defendant 1 was to manufacture the tobacco.”

③ Meanwhile, the Defendants could have employed several persons as employees to make a volume of nicotine-containingd solution, and sold them to sell KRW KRW 00,000,000 by selling them. In light of the circumstances of the Defendants’ behavior, the Defendants should have been able to confirm the illegality of their actions by making reasonable efforts.

④ The Defendants presented a written decision of non-prosecution on October 29, 2013 at the trial of the Suwon District Prosecutors’ Office (hereinafter “Songnam District Office”). The Defendants asserted that the Defendant did not explicitly state that the Defendant’s non-prosecution disposition issued around October 29, 2013 did not constitute a tobacco manufacturing business, including all devices that enable nicotine to inhale nicotine concentration and smoke, and that dilution was not likely to be an act of tobacco manufacturing). However, in light of the following: (a) the Defendants did not explicitly state that the Defendant’s non-prosecution disposition issued at the time of the instant case was not a disposition against the Defendants; (b) the Defendant 1 and the defense counsel did not know of the concept of tobacco content at the time of the first instance trial; and (c) the Defendant 1 and the defense counsel did not specifically state the content of the examination that the Defendant’s non-prosecution disposition did not constitute a tobacco manufacturing business; and (d) the Defendant 1 and the lower court did not specifically state the content of the examination at the prosecution’s office’s office’s 120th trial record.

D. Sub-committee

The defendants' above mistake of facts or misapprehension of legal principles is without merit.

2. Judgment on the mistake of facts or misapprehension of legal principles by Defendant 2

A. Whether the Defendant’s act constitutes a violation of the Tobacco Business Act or a violation of the principle of no punishment without law, in a situation where there is no separate criteria for permission on the electronic tobacco amount.

The defendants asserted as the grounds for appeal in the court below, and the court below rejected the above argument in detail with the detailed statement of the decision under Item 1-B(3) under the title "the judgment of the defendants as to the defendant's assertion". The judgment of the court below is just and acceptable, and there is no error of misconception of facts or misapprehension of legal principles as alleged by the defendant 2.

B. Whether Defendant 2 conspired

1) The judgment of the court below

According to the evidence duly admitted and duly admitted, in addition to the provision of electronic tobacco raw materials to Defendant 1, Defendant 2 was allowed to use the office of “Nonindicted Company 3” operated by Defendant 1 as the office of Korea branch of Defendant 4, and Defendant 1, etc. informed Defendant 2, etc. of the method of manufacturing electronic tobacco; ② before the instant case, Defendant 2 was operated by Nonindicted 5, but Defendant 1, who was an employee of Nonindicted 5, was in dispute between Defendant 2 and Nonindicted 5. ③ Defendant 2 received 70% of the amount of electronic tobacco sales from Defendant 1 as raw material and transportation charges; ④ Defendant 1 was the representative of the office of Korea branch of the above company; ⑤ Defendant 2 was the same as the address of the two companies; ⑤ Defendant 2 was informed of the method of manufacturing the electronic tobacco sales; and ④ Defendant 1 was able to recognize the amount of the electronic tobacco sales business with the authority of Defendant 1 to share the profits of Defendant 2 with Defendant 4 and Defendant 2’s funds.

2) Determination of the immediate deliberation

In addition to the above circumstances, the lower court and the trial court stated the following circumstances acknowledged by the evidence duly admitted and investigated by the court below, namely, ① Nonindicted Co. 6, working in Nonindicted Co. 4’s Korean branch office, in the process of examination of witness, classified Nonindicted Co. 3 (representative Defendant 2) and Nonindicted Co. 4’s branch office (branch president Defendant 1) into almost the same company from the employees’ point of view, and the actual operator of the above company stated that he was Defendant 2 (247 pages of the trial record). ② When Nonindicted Co. 6 was investigated by the police and customs office, he stated that he was able to make a false statement by stating that he was not superior (289 pages of the trial record), but Nonindicted Co. 2 stated that he was able to appear as a witness (3141 of the trial record), and that he was able to make a mixture of tobacco containing the method of sale of Defendant 2 and Nonindicted Co. 7 and Nonindicted Co. 8, etc. (31 of the trial record).

C. Sub-committee

Defendant 2’s assertion of misunderstanding of facts or misapprehension of legal principles is without merit.

3. Determination on the Defendants’ assertion of unfair sentencing

Defendant 1 is the primary offender, Defendant 2 has no record of being punished for the same crime, and according to the report on the fact-finding survey of electronic tobacco attached to the Korea Consumer Agency's response to the fact-finding by the Korea Consumer Agency, the fact that the Defendants did not detect the oil hyde and hyde in the electronic tobacco amount manufactured by the Defendants, etc. is favorable to the Defendants.

However, from February 2014 to December 2014, the Defendants sold 60,000 won of the instant tobacco. The Defendants appear to have sold 12,00 won if they were excluded from cost (the Defendants appear to have been 4,000 won or more from 3,000 won to 4,00 won of the actual cost) as a result of the Defendant’s investigation by marking the amount of tobacco concentration to the Korea Food and Drug Agency’s 50% of the total amount of customs duty imposed on the Defendant at a high rate on the whole when they were imported as finished products. However, according to the fact that the Defendants did not appear to have been able to have been able to have been able to obtain a fair verification of the content of tobacco consumption, i.e., tobacco consumption, PG, and VG consumption, etc., by using the fact that it was difficult for the Defendant’s body to view that the Defendants had been able to obtain a fair verification of the content of the instant tobacco consumption.

4. Conclusion

Therefore, the defendants' appeal is dismissed in accordance with Article 364 (4) of the Criminal Procedure Act because all of the appeals by the defendants are without merit. Article 25 (1) of the Regulations on Criminal Procedure provides that "Article 48 (1) of the Criminal Act" in Part 3 of the 17th sentence of the judgment of the court below shall be revised as "Article 30 (1) of the Tobacco Business Act, Article 282 (2) of the Customs Act, and Article 48 (1) of the Criminal Act". It is so decided as per Disposition (Article 30 (2) of the Tobacco Business Act provides that if it is impossible to confiscate tobacco and tobacco related to the crime under Article 27 of the above Act, the value thereof shall be collected additionally, and Article 282 (3) of the Customs Act provides that if it is impossible to confiscate all or part of the goods to be confiscated, a reasonable amount shall be collected from the domestic wholesale price of the goods not confiscated at the time of the crime, and the court below did not impose any disadvantage to the defendants even if necessary collection from the defendants pursuant to the above provisions.

Judges Lee Hun-sik (Presiding Judge)

(1) Meanwhile, Defendant 2 added his assertion that there was no perception of illegality due to the belief of the prosecutor’s non-prosecution decision on Nonindicted Co. 1’s non-prosecution after the end of the period for appeal, which does not fall under the legitimate grounds for appeal, but tried to refer to the demand for ex officio judgment, and also examined in the following 2.C.