2013Da20372 Compensation (as referred to)

Hyphd Co., Ltd.

Elxmmhem Co., Ltd.

Korea

Seoul High Court Decision 2012477473 Decided March 21, 2013

January 28, 2016

The judgment below is reversed, and the case is remanded to Seoul High Court.

The application for intervention by the plaintiff succeeding intervenor shall be dismissed.

Litigation costs incurred by intervention shall be borne by the intervenor succeeding to the plaintiff.

1. The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

A. The former Pharmaceutical Affairs Act (amended by Act No. 9932, Jan. 18, 2010; hereinafter the same shall apply) provides for necessary matters to ensure smooth implementation of pharmaceutical affairs, thereby contributing to the improvement of national health (Article 1). The Commissioner of the Korea Food and Drug Administration (hereinafter referred to as the "Administrator of the Korea Food and Drug Administration") shall require a person who has obtained marketing approval of drugs, non-pharmaceutical drugs, etc. (hereinafter referred to as "drugs, etc.") to prepare the methods of manufacturing, nature, efficacy, performance, quality, storage, and other necessary standards (Articles 51 and 52) of drugs, and a person who has obtained marketing approval of drugs, or a manufacturer of non-pharmaceutical drugs, etc. to sell, store, display, manufacture, or import drugs, etc. in violation of the aforementioned standards and criteria, and may order the person who has suffered marketing approval or to take other necessary measures, such as pharmaceutical products, etc., or a person who has received marketing approval or non-pharmaceutical drugs, etc. (Article 7).

In light of the above provisions, form, etc. of the former Pharmaceutical Affairs Act, it is reasonable to view that each of the above provisions of the said Act grants reasonable discretion to the Administrator of the Food and Drug Administration and relevant public officials (hereinafter referred to as the "Administrator of the Food and Drug Administration, etc.") to take measures to prevent harm to people's life and body due to drugs, etc., such as setting appropriate standards and criteria for drugs, etc. to the extent that it does not unfairly undermine the property rights of workers engaged in the relevant industry or the autonomous market order of the relevant industry, and the disposal of such drugs, etc., such as those violating such standards and criteria, or raw materials thereof, or those that have caused or are likely to cause harm to the public life and body.

In addition, as long as the former Pharmaceutical Affairs Act provides the Administrator of the Food and Drug Administration with the authority to perform his/her duties at reasonable discretion, in light of the purport and purpose of granting such authority to the Administrator of the Food and Drug Administration, etc., the violation of official duties is illegal only when it is deemed that the exercise or failure by the Administrator of the Food and Drug Administration, etc., under specific circumstances, is considerably unreasonable and is not socially reasonable (see, e.g., Supreme Court en banc Decision 2008Da38288, Apr. 22, 2010; Supreme Court Decision 2011Da38417, Feb. 13, 2014).

B. The reasoning of the first instance judgment cited by the lower court and the reasoning of the lower judgment and the evidence duly admitted reveal the following facts.

(1) The Plaintiff obtained permission from the Korea Food and Drug Administration (hereinafter referred to as the "Korea Food and Drug Administration") affiliated with Defendant to manufacture and sell medicines developed by the Plaintiff, and sold them to domestic pharmaceutical enterprises.

(2) Asbestos was recognized as a first-class cancer substance by the Ministry of Labor of the Republic of Korea, the United States Industrial Safety and Health Office (OSHA), and the International Cancer Institute (IARC). In addition, talc (Talc) is a substance manufactured by processing tampites, which can combine asbestos in nature with asbestos in the tamped light. However, since 1987, the International Cancer Institute (IARC) has designated tamps containing asbestos as a first-class cancer substance like asbestos.

In addition, the Occupational Safety and Health Act regulates the use of asbestos or asbestos-containing products in Korea, such as prohibiting the manufacture, import, transfer, provision or use of asbestos as one of the harmful substances prohibited from manufacturing, importing, transferring, providing or using asbestos, and prohibiting the manufacture, import, transfer, provision or use of asbestos-containing products (Notice of Ministry of Labor No. 2007 - 26).

(3) At the end of March 2009, the Food and Drug Administration issued an order to prohibit the shipment and sale of, and to take measures for, asbestos-containing drugs, etc. (4) checking that asbestos was used for other products such as sloping drugs, etc., including asbestos, after collecting and inspecting 30 scambanes distributed in the city, the Food and Drug Administration (hereinafter referred to as "the asbestos standard of this case") established a new 0-year standard for the non-explosion of asbestos in the domestic media, and issued an order to remove scams from 200 to 30-year standard for the supply of asbestos-containing drugs, etc. (hereinafter referred to as "the food and Drug Administration"). In addition, the Food and Drug Administration established a new 6-year standard for the non-explosionation of asbestos in scam, and issued an order to remove scams from 200 to 30-year standard for the supply of asbestos-containing drugs.

In addition, the Food and Drug Administration fabricated the test result of the scke-related net test for the same period of time, thereby spreading a suspicion of selling inferior scke to the pharmaceutical company. (6) Accordingly, the head of the Food and Drug Administration judged that all the scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scke-related scak-related scak-related scak-related scak-related scak-related scak-related s.

However, even if the Food and Drug Administration allowed re-distribution of items that are confirmed to have been manufactured using normal sprink ingredients after the instant disposition, and added the relevant items to the list of "drugs confirming the use of asbestos sprinkk" and added them on the food and drug website. The Plaintiff did not raise an objection to the Food and Drug Administration for this purpose, and there was no result of the follow-up investigation by the Food and Drug Administration that the Plaintiff was found to have used normal sprinks.

(6) On the other hand, the Administrator of the Food and Drug Administration had expressed his opinion on the hazards of asbestos-containing drugs from specialized institutions and relevant organizations prior to the instant disposal. ① On April 1, 2009, the Korean Association of Toxic Studies, etc., unlike contaminated drinking water, it is difficult to determine whether asbestos is harmful to human body. However, as to drugs and cosmetics, it is necessary to verify the current status of asbestos contamination in order to ensure the safety of human body, and if asbestos contamination is observed, it is necessary to take measures to refrain from using asbestos in accordance with the precautionary principle, and establish a comprehensive management plan for asbestos-containing drugs in addition to conducting scientific research for the establishment of the base value. ② On the request of the Food and Drug Administration on April 6, 2009, the Korean Association of Standards for Food and Drug (hereinafter referred to as the “Korea Association of Standards for Food and Drug 4”) established new guidelines for the removal of asbestos-containing drugs on its website, and ③ consultation on the provision of asbestos-containing drugs to the Association of Standards for Food and Drug 9.

3. In principle, I express my view that it is desirable to suspend the sale and distribution of asbestos-containing drugs previously manufactured and to recover the products at the time.

C. We examine these facts in light of the legal principles as seen earlier. (1) insofar as it is clear that asbestos or asbestos-containing cells are seriously harmful to human body, it is difficult to readily conclude that the Administrator of the Food and Drug Administration erred by recognizing that it is likely to cause harm to public health due to an asbestos-containing medicine, etc., even though the harmfulness of human body, such as a drug containing asbestos, was not yet revealed scientifically. (2) In addition, the asbestos contamination slope distributed in the Republic of Korea was supplied by virtuecucucucuck. Since around 2006, he was supplied with decucucucuous materials from one company. Furthermore, considering the circumstances revealed in the suspicion of sale of decucucucuous drugs by manipulating the test result related to the suitability of decuck for the same period, it cannot be readily concluded that the Plaintiff’s determination of risk of being contaminated by asbestos-containing drugs manufactured by using the aforementioned drugs is contrary to the empirical rule of the Food and Drug Administration, and therefore, it is difficult to deem the Plaintiff’s disposal of the instant medicine.

(3) In addition, prior to the instant disposition, relevant organizations, including experts, recommended administrative measures, such as the self-production of asbestos-containing drugs or the prevention of their manufacture and marketing, prior to the instant disposition. Furthermore, considering the circumstances in which the Central Pharmaceutical Affairs Council, in principle, excluded the sale and distribution of the asbestos-containing drugs manufactured prior to the implementation of the asbestos standard, and expressed its opinion that it is desirable that the pertinent item should be recovered from the time of the market, it is difficult to deem the Administrator of the Food and Drug Administration to take the instant disposition as an extremely unreasonable act. (4) On the other hand, since risks to public health caused by harmful drugs would be difficult to recover by money, etc., and thus, it is extremely broad to inflict preventive measures on the administrative agency.

It is necessary to take active and preemptive measures.

In addition, although the former Pharmaceutical Affairs Act does not have a separate remedy procedure for measures such as recovery and destruction of medicines in circulation, the Administrator of the Food and Drug Administration prepared a series of remedy procedures to prevent unfair damage to manufacturers, etc. of medicines due to the instant disposition. Nevertheless, unlike other companies, the Plaintiff did not disclose that the Plaintiff used the normal part of the medicines manufactured by the Plaintiff using such remedy procedure. (5) In full view of the aforementioned various circumstances, the Plaintiff’s disposition of this case is deemed to have exercised authority at the discretion granted to the Administrator of the Food and Drug Administration, etc. in order to prevent risks to the lives and bodies of the people, and it is insufficient to find that the Administrator of the Food and Drug Administration’s exercise of discretionary power is considerably unreasonable and thus, it constitutes a case where there is no social feasibility.

D. Nevertheless, the lower court concluded that the instant disposition, on the grounds as indicated in its reasoning, lost objective legitimacy as an illegal disposition that significantly deviates from discretionary power.

Therefore, this judgment of the court below is erroneous in the misapprehension of legal principles as to the discretion of administrative agencies and in violation of the principle of free evaluation of evidence against logical and empirical rules, which affected the conclusion of the judgment. The ground of appeal assigning this error is with merit.

2. The plaintiff's successor's application for intervention is examined.

The Plaintiff’s succeeding intervenor filed an application for intervention in succession to this court by taking over part of the rights from the Plaintiff, but the participation by the successor in the final appeal, which is a legal trial, is not allowed (see Supreme Court Decision 2002Da48399, Dec. 10, 2002). The Plaintiff’s succeeding intervenor’s application for intervention is unlawful.

3. Therefore, without further proceeding to decide on the remaining grounds of appeal, the judgment of the court below is reversed, and the case is remanded to the court below for further proceedings consistent with this Opinion. The application for intervention by the plaintiff succeeding intervenor is dismissed, and the costs of lawsuit incurred by the intervention are assessed against the plaintiff succeeding intervenor. It is so decided as per Disposition by the assent of all participating Justices

Justices Kim Shin-chul

Justices Kim Yong-deok

Justices Park Young-young

Justices Kim Jong-il