Poster for "Hansan: Redux" / Courtesy of Lotte Entertainment

A court has ruled in favor of Coupang Play in its legal dispute with Lotte Culture Works over the latter's decision to provide a director's version of a local movie to Netflix despite an exclusive supply contract with Coupang Play.

The Seoul Central District Court on Jan. 23 ordered Lotte Culture Works to pay 5 billion won ($3.48 million) in back royalties to Coupang Play.

The two companies had signed an exclusive content licensing agreement for the distribution of "Hansan: Rising Dragon," the 2022 historical action film by director Kim Han-min and the second installment in his trilogy about Korea's legendary naval Adm. Yi Sun-sin. The contract was valued at 12.5 billion won.

But Lotte later provided a director's cut, "Hansan: Redux," to Netflix under a separate agreement signed in 2020 allowing the streaming giant to acquire local films with over 300,000 viewers.

Lotte argued that the director's version was a distinct product, separate from the original film, as it included an additional 21 minutes highlighting Adm. Yi's human aspects and other naval battle scenes.

Earlier this week, Lotte filed an appeal. (Yonhap)