1. The Plaintiff (Counterclaim Defendant) paid KRW 326,432,701 to the Defendant (Counterclaim Plaintiff) and its amount from March 9, 2018 to November 9, 2018.

A principal lawsuit and a counterclaim shall be deemed simultaneously.

1. Basic facts

A. The plaintiff is a company that manufactures the clothing yarn, and the defendant is a company that produces and exports the clothing to a foreign country.

On November 2015, the Plaintiff and the Defendant entered into the original supply contract (hereinafter “instant contract”).

B. In the instant case, the Defendant’s export of the clothing was first of all, upon receiving an order for clothing production from the Customer, requested the Plaintiff to make a set of raw materials containing the pattern requested by the Customer pursuant to the instant contract, and thereafter, the Plaintiff supplied the original parts to the salary-making factory in a transaction relationship with the Defendant (if the Defendant raises an objection after confirmation of the defect in the process of inspecting the original parts supplied by the Plaintiff, the Plaintiff supplied a new original parts without defect), and the goods were produced to the original parts supplied by the Plaintiff at the salary-making factory and supplied to the Defendant’s customer.

C. Meanwhile, among the Defendant’s business partners, the U.S. companies “A” (hereinafter “A”) sold the clothing supplied in the above manner to the market. From early 2017, consumers’ complaints on the quality of the clothing produced by the Plaintiff from the original bucker supplied by the Plaintiff (in the case where the part of ambucks or bucks are easily teared) have been continuously received.

Accordingly, from January 2016 to July 31, 2017, a purchasing enterprise has exchanged or refunded to consumers the products found to be defective from among the stackes sold. D.

The purchasing enterprise, as above, conducted quality re-inspection of the products remaining without being sold out of the covering source, and as a result of the inspection, was confirmed to be less than the standard for the power strength of the original unit.

Accordingly, a purchasing enterprise shall discard the whole amount of the products produced by the original group of FLR 207, 424, 469, 4073, and 4481 (hereinafter referred to as the “original number”) supplied by the Plaintiff, and all the contracts related to the above original group concluded with the Defendant.