SEOUL A South Korean court, in an unprecedented ruling, ordered Japan's Nippon Steel & Sumitomo Metal Corp (5401.T) on Wednesday to compensate four South Koreans for forced labor during Japan's 35-year colonial rule of Korea.
The Seoul High Court ordered the company to pay 100 million Korean won ($88,000) to each of the four plaintiffs who joined the case. It rejected Nippon Steel's argument that it was a different entity from the steelmaker that employed the South Koreans.
Japanese courts have thrown out claims by South Korean and Chinese who suffered at Japanese hands during World War Two, arguing the matter of compensation was closed under the 1965 treaty between the two countries normalizing diplomatic ties.
Nippon Steel, which merged with Sumitomo Metal Industries last year, has argued in previous court cases that it was not responsible for the actions of the wartime steelmaker.
The steelmaker engaged in an "inhuman criminal act by mobilizing workers for invasionary war causes together with the Japanese government," the court said in the ruling.
The attorney for the plaintiffs, Kim Mi-kyung, said they had no immediate plans to take action to seize company assets in South Korea, but wanted to discuss compensation with the company.
The plaintiffs had previously brought a suit against Nippon Steel Corp in the Japanese city of Osaka, seeking compensation and unpaid wages. Their case was dismissed on grounds that the company was not the same entity that existed during the war.
Nippon Steel said it would appeal the decision.
"We deeply regret this unjustified ruling, which goes against the 1965 Japan-Korea Claims Settlement Agreement - a formal agreement between nations - that completely and finally resolved such issues as forced labor," it said in Tokyo.
"We will swiftly appeal to the Supreme Court of Korea and hope to make clear the legitimacy of our position."
Shin Chan-soo, one of the plaintiffs, said he was lured to Nippon Steel's Osaka plant with promises of money and experience. He said he worked for two years and that his only pay was sufficient to buy a pack of cigarettes.
"We have fought for months and years. I feel great. We kept losing in lawsuits in Japan but now back to Korea, we won," Shin, 86, said after the ruling.
"We are dying one by one ... They did wrong and didn't clean up."
Japan occupied and ruled Korea from 1910-1945. There are no official estimates of the number of Koreans who may have been forced laborers in Japan, although media reports have put their numbers in the hundreds of thousands.
($1 = 1141.7000 Korean won)
(Additional reporting by Ritsuko Shimizu in Tokyo; Editing by David Chance and Ron Popeski)