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On June 1, 2023, EXO‘s Chen, Baekhyun, and Xiumin announced they were suing SM Entertainment to terminate their exclusive contracts with the company. They cited not being provided with the accounting records concerning their payouts when they asked for them, as well as long contract renewal periods of up to 2027 and 2028.
Regarding EXO-CBX‘s claims, SM Entertainment has released a long statement. They have denied any claims of not providing accounting records throughout the many years, and insist that the members raised no issue until recently.
Hello. This is SM Entertainment. As we have received notification from the representation of Byun Baekhyun, Kim Jongdae, and Kim Minseok (hereafter to be referred to as ‘the artists’), our firm may also be releasing our standpoint.
Firstly, EXO is an artist that our firm actually thinks of preciously. Because of that, even throughout the interval of our present contract, we now have already elevated their wage charges twice. We have been paying our artists for a few years underneath the circumstances that they will verify our accounting information at any time. During these years, they haven’t expressed any dissatisfaction with our payout course of in any respect. Even throughout the cut-off date once we have been discussing contract renewals with our artists as their present unique contract was coming to an finish, because the dialogue ended on a word of equal footing, Byun Baekhyun, Kim Jongdae, and Kim Minseok all signed new unique contracts with us, and through this course of both, no issues arose as a consequence of fee points.
However, their authorized consultant immediately started claiming that this new unique contract couldn’t be acknowledged, and we started receiving tip-offs that there have been exterior forces that have been inflicting our artists to waver. Our firm was very bowled over, however with the intention to utterly respect our treasured artists’ opinions, we steered signing a mutual settlement, and we requested that as an alternative, they needed to reassure us that they didn’t signal any double contract that violates our unique contract. Then, the artists’ authorized consultant, who had first steered signing the settlement, immediately modified his perspective and halted discussions of the settlement, and knowledgeable us that they’d be terminating their unique contract with us with none rationalization concerning the double contract.
1. Transparency concerning payouts
Every month we bear the payout course of, and it’s potential to view the accounting information. The artists haven’t raised any issues concerning payouts. Even although it’s potential to view the accounting information at any time, they requested ‘duplicate copies’ of the information for different motivations and used this as a purpose for termination.
Firstly, it’s utterly not true, as per the claims of the artists, that we now have not correctly supplied the accounting information, and we’ll clarify this intimately. Before the revision of the Pop Culture and Arts Industry Development Act, our firm had been settling our payouts twice a yr. After the revision, we now have been settling it as soon as a month. Regarding the information, the artists may go to the corporate each time they need, and we now have been cooperating with this in order that they will verify the information. Whenever the artist visited, we now have been individually offering the artist with the expenditure information, and the artist has not raised any points recording our payout strategies. But simply as we now have talked about earlier than, exterior forces have approached our artists and unfold false rumors. We have additionally acquired a tip-off that they’ve tried to incite the artist and have been suggesting to our artist that it doesn’t pose a authorized difficulty in the event that they signal unique contracts with them, ignoring our unique contract with the artist. So to talk, we can’t assist however suspect that the exterior forces had been influential within the artists elevating points in regards to the payouts or asking for duplicate copies of all the accounting information.
Accordingly, we now have already defined a number of instances that all the accounting information, each the prevailing and previous information, could be considered, and the artist will probably be allowed to verify intimately, as a lot as they need, in accompaniment with knowledgeable equivalent to representatives and accountants.
— SM Entertainment
It appears that SM Entertainment denied a latest request to create copies of accounting information after suspicions that EXO-CBX was being swayed by exterior forces.
But lately, as we now have already sufficiently defined to the artists’ authorized consultant, we solely permit viewing [and not copies] as a result of it could possibly be unfairly supplied to a 3rd get together, such because the exterior forces talked about above. Even so, within the first place, not solely did the artists’ representatives present no response that they’d verify the contents first, however additionally they didn’t promise that they’d not present the information to exterior forces. He additionally didn’t reply to the basic query of whether or not a double contract had been signed with the exterior forces or if any discussions have been underway, and solely robotically repeated that that they had no alternative however to terminate the contract as we didn’t present duplicate copies of the accounting information.
Ultimately, provision of duplicate copies of the artists’ accounting information is an issue that we can’t sit by. For instance, if detailed promotional information which are within the information are leaked to exterior forces, the opposite members aside from these three members may obtain unfair harm. Hence, our firm requested to verify if there was a double contract signed between the artist and exterior forces, however the artists’ consultant didn’t reply and shortly despatched an official discover that they’d be terminating the unique contract.
— SM Entertainment
SM Entertainment additionally defined that their contracts have been all based mostly on the requirements created by the Fair Trade Commission. The contracts have been additionally acknowledged by the Supreme Court.
2. Regarding the prevailing contract and the brand new contract’s legitimacy and validity
- The contact was made in response to the usual unique contract
- The contractual interval, legitimacy, and validity have each been acknowledged by the Supreme Court.
- Regarding the brand new unique contract signed on December 30, 202, the contract was accomplished after agreements in regards to the detailed clauses, with large-scale regulation agency attorneys on the facet of the members.
Secondly, we’ll clarify the legitimacy and validity of the brand new and current unique contracts. The firm is faithfully adhering to the usual unique contract established and really useful by the Fair Trade Commission and the Ministry of Culture, Sports, and Tourism. The contract was acknowledged for its validity and legitimacy by the Supreme Court in a previous lawsuit filed by former member Hwang Zitao, in a lawsuit that confirmed the non-existence of an efficient unique contract. Even so, we additionally signed two annex agreements with the EXO members, together with the artists in query, to vary the wage charges in favor of the artist. This was a measure we took to advertise the shared development of our firm and artist, although there was no contractual obligation [on our side].
We want to strongly level out that we’re making certain that the artists obtain enough help and that they will signal contract renewals of their free will with us after in-depth discussions. In actuality, though Girls’ Generation and f(x) members, and so forth., have signed unique contracts with different firms, they keep good relationships with the corporate. Especially for Girls’ Generation’s case, even after three members moved to different businesses, they’ve launched albums with our firm and joined in on SMTOWN performances. On the opposite hand, there are additionally circumstances the place after cautious consideration, many artists have re-signed with us greater than as soon as, equivalent to TVXQ and Super Junior, and so forth., who each have re-contracted with us twice.
— SM Entertainment
Lastly, SM Entertainment bolstered that the renewal contracts and agreements have been created after a really lengthy interval of dialogue and mutual compromise with the artists.
In actuality, on the level the place the artists in query’s contracts have been coming to an finish, we didn’t drive renewals upon them, they usually acquired help from large-scale regulation agency attorneys and re-contracted with us after enough agreements. Our firm had a really lengthy interval of dialogue with EXO, spanning from June 2021 to the top of 2022, lasting virtually a yr and 6 months. On December 30, 2022, the seven members re-contracted with us. The members who re-contracted with us have their contract beginning durations all completely different as a consequence of their navy durations differing. But as a result of we all know the significance of EXO as a group, the members and the corporate proceeded with renewal discussions, beginning with the members that concluded their contracts first. During the method of dialogue for renewals, the large-scale regulation agency attorneys employed by the EXO members have been part of it since April 2022, and we compromised with one another within the course of. In specific, from mid-November 2022, we exchanged amendments for round a complete month with the members’ representatives, totaling eight instances, and accomplished detailed discussions on every phrase within the clauses of the unique contract. Despite this, the artists’ lately appointed consultant immediately modified their place and claimed that the validity of the brand new contract couldn’t be acknowledged, main us to make the great guess that what we acquired a tip-off on is true.
Our firm’s greatest purpose is to guard EXO and the followers who’ve given EXO infinite love and assist, and taking it a step additional, to additionally defend all the artists underneath us. In order to achieve this, we’ll take sturdy authorized motion towards exterior forces that attempt to shake and break up the group by deceptive the artists with baseless rumors, candy phrases, and unfair monetary temptation.
Thank you.
— SM Entertainment
You can learn extra about EXO Chen, Baekhyun, and Xiumin’s unique claims under.
EXO’s Baekhyun Xiumin And Chen Sue To Terminate Contract With SM Entertainment
EXO
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