Did Loona’s Chuu start a revolution? That’s a bit of an exaggeration but it seems like the Loona members’ wins in their contract disputes is encouraging more K-pop idols to file for contract terminations and fiercer renegotiations. Perhaps unexpectedly, EXO’s Baekhyun, Xiumin, and Chen have notified SM Entertainment this morning regarding the termination of their existing exclusive contracts as of today, June 1.
The trio known as the sub-unit EXO-CBX delivered their official statement through their legal representative and lawyer Lee Jae Hak from law firm LIN. It “conveyed various injustices that they have not been able to speak” and was undertaken “with the thought and courage that this is also for [clarifying] various doubts that many SM artists have.”
“Slave contracts” and the “refusal to provide settlement reports”
EXO-CBX’s two key complaints made in the statement were against SM’s alleged “refusal to provide settlement reports” and alleged “unjust long-term contracts and attempts to extend them further.”
“Previously, the artists sent certifications of contents to SM seven times through their legal representative from Mar. 21 until recently, and through this, they repeatedly requested copies of transparent settlement reports and settlement grounds.
“It is the bare minimum and legitimate right of the artists to request an accurate and transparent basis for settlements that have not been clear until now, and SM is also obliged to comply in accordance with the exclusive contracts and the Popular Culture and Arts Industry Development Act. However, SM eventually maintained an unjust position stating that they cannot provide copies of the reports,” the statement alleges in part.
“In addition, after SM signed long-term contracts with the artists that span over 12 to 13 years in the past, they pushed for the artists to sign subsequent exclusive contracts once again, resulting in long-term contracts that span over at least 17 to 18 years or more. SM has been repeatedly committing unjust use of power such as this.
“Regarding this, the artists feel that SM is using their superior position to force artists to sign so-called slave contracts that span over almost 20 years including their training periods, which are also far from being short.”
The statement cites TVXQ’s 13-year contract period as an example of an excessively long-term contract that “excessively infringes on the economic freedom and basic rights of the idols by imposing excessive quid pro quo.”
It also claims that “Xiumin and Chen are the members who [SM] planned from the start to be active in China, [who] were forced from the beginning to sign long-term contracts which span over 10 years or more from the date of their exclusive contracts.”
Apart from this lawsuit, Baekhyun, Xiumin, and Chen stated that they are also considering filing a complaint to the Korea Fair Trade Commission.
SM’s denial and claim that Big Planet Made is attempting to poach its artists
In response, SM Entertainment also issued a statement today claiming that it has “confirmed the presence of outside forces approaching our agency’s artists, providing them with false information, false court documents, and irrational offers, such as convincing them that there would be no legal repercussions if the artists chose to sign contracts with other agencies while still bound to SM Entertainment.”
In excerpts from an article circulating via fan tweets, SM said to have claimed that it signed a new exclusive contract with seven EXO members on December 30, 2022 and that “there was never a problem with the details of the settlement in the process.”
“Furthermore, these outside forces are not stopping at simply enticing one or two artists into violating their contracts, they are using the artists they have made contact with to tap even more of our agency’s artists,” the agency also claimed.
Ilgan Sports reported that SM Entertainment forwarded a legal document directed at entertainment agency Big Planet Made, claiming that it attempted to recruit SM artists.
However, Big Planet Made denied this stating, “We have never met with the artists mentioned in the report, and we have never discussed or exchanged opinions on any exclusive contracts.” It added that though its in-house director MC Mong “met with his hoobae artists (EXO-CBX) for a personal gathering, there was no attempt to recruit them as artists.”
“We will not stand by idly and watch while forces with no interest in ensuring the future of our artists, or making sure of their fair legal rights, chase after their greed for money; we will pursue all possible legal action. If we do not act now, the tyrannical activities of these outside forces will significantly damage our artists’ brand and image, and inflict negative influence on our artists’ bright futures,” said SM.
SM’s “unstable situation”
In the months leading up to this lawsuit, other SM artists have been expressing concern over the future of the agency amid its management feud. An investment banking report in March stated that SM Entertainment is estimated to have spent tens of billions in South Korean won to respond to disputes over management rights. SM spent approximately $1.9 million to hire the Boston Consulting Group. They also hired six voting agencies to secure shareholder voting rights.
Fans have been worrying whether the company can continue supporting its artists despite this spending. Among SM artists whose contracts are set to expire either this year or next year are: BoA, Super Junior, TVXQ, Girls’ Generation (Taeyeon, YoonA, Yuri, Hyoyeon, and Sunny), EXO, SHINee, Red Velvet, NCT, and SuperM.
On February 13, Shinee’s Key said in his live broadcast, “I want to perform more than anyone else, but I have no idea who I can talk [to] about this. The company is in an unstable situation.”
A message to EXO-L
Fans have trended several hashtags in support of the EXO members such as one that translates to “I only believe what EXO says.”
EXO-CBX’s statement also includes a message to fans. “We apologize for causing great concern to fans through this issue, and there is no way to fully express our apology. Although legal action is inevitable due to a difference in our position with SM, we will do our best to find a wise way to resolve this dispute so that we do not cause fans too much concern,” it reads in part.
“As we try to speak up with our small voices regarding the unfairness we couldn’t speak of until now, we are actually very frightened and fearful of this moment right now. We hope that you take interest in what we are saying as well as our difficult courage. We once again sincerely thank our fans who have supported us for a long time.”
EXO’s seventh regular album is scheduled to be released by SM in the third quarter of 2023. In a separate statement released today, SM also denied the rumored postponement of EXO’s music video filming. “We will proceed with the MV filming of seven EXO members as scheduled [on June 2],” the agency said.
Depending on how both parties proceed, fans who’ve been waiting for a comeback and world tour with all the members who aren’t currently enlisted in the military may have to wait awhile. But when EXO does return, we hope that they’re happier.