US Litigation Risk Becomes Reality: Judicial Risk for Global Platform Companies as Shown by the Naver Class Action

The information at issue in this case is biometric information, which is treated as far more sensitive than ordinary personal data.

Biometric information has the following characteristics.

• It is highly identifying, including facial feature values and facial geometry information.
• Once leaked, it cannot be changed the way a password can.
• It carries not only the risk of privacy invasion but also the risk of misuse for security breaches and crime.

Because of these characteristics, there is a strong tendency in the United States to regard biometric information as high-risk information that requires strict prior consent and purpose limitation.

In particular, the plaintiffs took issue with the points that the Naver affiliated services did not sufficiently inform users of the very fact that biometric information was being collected, and also did not clearly disclose how that data was shared with internal company systems or with third-party systems.

One of Naver's central defense arguments was the absence of personal jurisdiction in the California courts.

The main arguments were as follows.

• The Korean headquarters and the Japanese affiliate are not entities that directly conduct business within the United States.
• There were insufficient contacts with the State of California.
• The entities responsible for operating services for US users and for processing data are separated by each corporate entity.

The plaintiffs, by contrast, rebutted this and advanced the following reasoning.

• The app users in the United States number at least in the tens of millions.
• A substantial user base also exists within California.
• The failure to apply geoblocking technology is a circumstance indicating active targeting of the US market.
• The US subsidiaries are substantively connected with marketing, app publishing, and server infrastructure.

In the end, the court found that it could not resolve this issue on Naver's filings alone, and it ordered jurisdictional discovery.

The stage in US litigation that companies feel as the heaviest burden is, without question, the discovery system.

Once the court moves the case to a hearing on the merits and the examination of evidence, a company may face pressure to produce materials such as the following.

• Internal emails
• Source code and technical documents
• Data processing policies
• Server architecture and log records
• Internal decision-making materials
• Marketing and revenue structure materials

In this case as well, the plaintiffs took issue with the operation of the SenseTime SDK embedded in the Naver affiliated services and with its data flow, and they actively sought to prove the connecting structure between the US related companies and the Korean and Japanese headquarters.

In addition, the court granted part of the defendants' early motion to dismiss, while finding that a hearing on the merits was possible as to the alleged unauthorized collection of biometric information, and it later again adjusted the scope of dismissal relating to Snow, while keeping the B612-related allegations within the scope of continued review.

US litigation, and class actions relating to personal data and biometric information in particular, exert strong pressure on companies even before a judgment on the merits.

The reasons are as follows.

• The mere possibility of class certification increases bargaining power.
• Enormous discovery costs arise.
• The risk of disclosing trade secrets and technical information is significant.
• The possibility of punitive damages or a large settlement exists.

In fact, in similar cases, Facebook (Meta) paid a settlement of approximately 650 million dollars at the end of a biometric information class action, and TikTok (ByteDance) likewise settled for approximately 92 million dollars.

US litigation is a complex international dispute that combines jurisdiction, service, class actions, discovery, ADR, the protection of technical secrets, and the response to personal data regulation.

In particular, when a platform company or an IT company becomes embroiled in US litigation, it may have to bear, beyond the issue of damages, the disclosure of internal technical materials, harm to corporate reputation, and disruption to global business expansion at the same time.

At Daeryun Law Firm LLP, attorneys with experience in international disputes, personal data, corporate legal affairs, and US litigation response work together to provide comprehensive support, including early response strategy relating to US court litigation, jurisdictional disputes, discovery response, review of affiliate structures, and the development of settlement and ADR strategies.

In addition, through collaboration with the US local law firm SJKP, the firm provides a one-stop service that extends to responding to US federal court litigation procedures, managing collaboration with local law firms, analyzing multinational corporate structures, and reviewing personal data and biometric information regulatory risk.

If you are operating services in the US market, or are providing platform or app services to US users, it is important to review the matter proactively before US litigation risk becomes a reality.

If you need assistance, you are welcome to confirm a specific direction for your response through 🔗Booking a Legal Consultation.

Daeryun, the ninth-ranked law firm in Korea (based on 2025 National Tax Service value-added tax filings), assists in resolving cases through the systematic strategies of legal experts across multiple fields.