Two American investors are suing South Korea's government over alleged unlawful practices used to hurt Coupang Inc (NYSE:CPNG). Here's why they filed the lawsuit and how much they've lost on their investments in the ecommerce company since the end of the third quarter.

Investors Sue South Korea

Well-known investor Brad Gerstner, who often invests in technology stocks, filed arbitration claims against the government of South Korea, related to the actions against ecommerce company Coupang.

Gerstner leads Altimeter Capital Management, which is an investor in the company.

Greenoaks, another Coupang investor which is led by Neil Mehta, also filed claims against the South Korean government, as reported by Axios.

Along with the claims against the South Korean government, Greenoaks and Altimeter are also asking the U.S. Trade Representative to investigate the matter.

As an ally of the United States, South Korea faces claims centering on the U.S.-Korea Free Trade Agreement and the partnership between the two countries. The claims allege that South Korea discriminated against Coupang, which is based in Seattle but does the majority of its business in South Korea.

The investors use comments from South Korea Prime Minister Kim Min-seok in the complaint, including the government official saying that law enforcement should use "the same determination used to wipe out mafias" when looking at Coupang.

The investors say the government was too aggressive in punishments for a 2025 data breach by Coupang, actions that may have boosted Chinese competitors.

"I doubt the administration & Congress are going to let a U.S. company be unfairly destroyed by our presumptive ally South Korea just bc they favor a local company. It's a terrible precedent. America First means a level playing field for our companies," Gerstner tweeted, while also tagging U.S. Secretary of Commerce Howard Lutnick.

Gerstner's tweet came in response to a post from investor Joe Lonsdale, who shared the Axios story.

"S Korea's government is making a huge mistake following in China's footsteps and illegally harassing a U.S. company to favor Chinese tech giants," Lonsdale tweeted.

Lonsdale said Korea's president has to decide if hurting trade relations with the United States is worth "advancing CCP interests."

"Business with the USA must be free and fair. We don't tolerate discrimination and bullying."

Greenoaks founder Mehta said that "trade agreements are only as strong as our willingness to stand up for them."

Mehta said that international competition should be "governed by rules, not the whims of politicians."

The complaint from the two investors starts a 90-day cooling off period for South Korea that could lead to "self-correction" or to a hearing, according to the report. The letter to the U.S. Trade Representative also starts a 45-day clock that could lead to an investigation under the U.S. Trade Act.  

Investors Down on Coupang Investments

Altimeter Capital owned 10,024,584 shares of Coupang at the end of the third quarter, according to 13Finfo.

The investment was worth $322,791,000 at the end of the quarter. With Coupang shares dropping since the end of September, the stake is now worth $199,088,238, down over $123 million. Altimeter is down over 38% on the shares since the end of the third quarter.

Greenoaks owned 15,377,927 shares at the end of the third quarter. The stake, which was worth $495.17 million at the end of the third quarter, is now worth $305,405,630. Greenoaks stake is down $189.76 million since the end of the third quarter.

In the Greenoaks fund, the Coupang stake was one of the top holdings at the end of the third quarter, representing 16% of the investments. For Altimeter, the Coupang stake was around 4.3% of the assets at the end of the third quarter.

South Korea Responds

On Wednesday, South Korean President Lee Jae Myung said the country will address the issue fairly, as reported by Reuters.

Yeo Han-koo, South Korea's Trade Minister, previously said the country's government was not discriminating against Coupang. The government official met with a U.S. trade representative and members of Congress earlier this month.

"If a Korean company doing business in the U.S. caused such a large-scale information leak in the U.S., the U.S. would naturally do the same, and I clearly explained this and U.S. officials understood that," Yeo previously said.

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