South Korea online retailer Coupang faces US securities class action over massive data breach

By Mike Scarcella

WASHINGTON, Dec 22 (Reuters) – South Korean e-commerce company Coupang has been sued in a U.S. court in an investor class action alleging violations of securities laws ‍after a cybersecurity breach exposed personal information of more than 33 million customers.

The lawsuit, filed last week in federal court in California, claims Coupang, its CEO and Chairman Bom Kim and its Chief Financial Officer Gaurav Anand misled investors about the company’s data security practices ‌and failed to disclose the breach in ‌a timely way.

Coupang, South Korea’s biggest online retailer, last month apologized over the breach of personal information through unauthorized data access. In the aftermath, Park Dae-jun, chief executive of subsidiary Coupang Corp, resigned this ​month.

The company, dubbed the Amazon.com of South Korea, previously said it would tighten security to prevent another data leak.

Coupang ‍did not immediately respond to a ​request for comment, and neither did a lawyer ​representing the investor who filed the lawsuit on December 18.

Coupang, which ‍operates globally, has offices in California and other U.S. cities. The company dominates South Korea’s e-commerce market, providing same-day delivery, video streaming and food delivery. The breach has spurred investigations in South Korea.

The lawsuit said Coupang discovered on November 18 ‍that a former employee had retained access to internal systems for months, compromising customer names, email addresses, delivery addresses and some order ‍histories. The company said ‍the breach did not expose payment details ​or login credentials.

Coupang failed to report the breach ​under ⁠U.S. securities rules in a timely way, ‌the lawsuit alleged.

Coupang, according to the lawsuit, submitted U.S. regulatory filings that understated the company’s vulnerability to cyberattacks and overstated its safeguards. The complaint is seeking damages for investors who purchased Coupang securities between August 6 and December 16.

(Reporting by Mike Scarcella; Editing by David ⁠Bario, Rod Nickel)