Legal Battle Ensues as Boy Band's Future Hangs in the Balance

Provided by SM Entertainment

In a statement released on Monday, SM Entertainment, the prominent entertainment agency, vehemently denied allegations made by three members of the popular boy band EXO, refuting claims of "slave contracts" and asserting that the contracts were fair and justified. The agency's response comes after Chen, Baekhyun, and Xiumin filed a complaint against SM Entertainment with the Fair Trade Commission (FTC), accusing the company of coercing its artists into signing unfair contracts.

Addressing the matter, SM Entertainment emphasized that one EXO member has yet to sign an extension contract and is currently engaged in discussions with the agency. This, according to SM Entertainment, demonstrates that the members willingly signed the contracts of their own volition. The agency categorically dismissed any notion of exploitative practices, stating that characterizing the contracts as "slave contracts" or exaggerating the duration of the exclusive contracts is misleading and far from the truth.

Last week, Chen, Baekhyun, and Xiumin publicly expressed their dissatisfaction, claiming that they were compelled to agree to excessively lengthy contracts that exceeded the seven-year limit recommended by the government. The trio argued that the exclusive contracts they signed with SM Entertainment mirrored the problematic contracts that the FTC had prohibited more than a decade ago.

Attorney Lee Jae-hak, representing the three members, highlighted that the FTC had already informed SM Entertainment that their contract terms, which commence from the artists' debut date rather than the day of contract signing, were "extremely unfavorable" compared to those of other entertainment agencies. Lee further asserted that the company consistently disregarded official judgments made by the FTC, illustrating a concerning pattern of ignoring government authorities.

To support their claims, the members released a segment of Baekhyun's contract, which indicated that the contract's effectiveness is tied to the release of his first album, rather than the contract signing date. Additionally, Baekhyun and other members were required to sign a supplementary agreement that extended their contracts by an additional three years to facilitate overseas activities. According to Lee, such arrangements could potentially bind an artist under an exclusive contract for up to 13 years, encompassing their mandatory military service period.

The prevailing industry standard, as recommended by the government, is a seven-year contract, with the artist retaining the option to terminate it if it exceeds the prescribed threshold. The three EXO members asserted that an extension contract, presented shortly before their original contract's expiration, contained clauses enabling automatic extensions if the artist failed to release a certain number of albums. Attorney Lee labeled such contracts as "blatant slave contracts," condemning the attempt to excessively restrain artists with prolonged and limitless agreements as fundamentally unfair.

SM Entertainment swiftly countered the allegations, asserting that the contracts were not coerced and were signed with the assistance of reputable law firms. The agency highlighted that the EXO members actively participated in negotiating contract clauses, engaging in meticulous discussions over each word for an extended period.

While not directly addressing the members' complaint to the FTC, SM Entertainment agreed to release the payment data as requested by the members, provided they agree not to exploit the information for unfair purposes. The agency emphasized its commitment to EXO's group activities, assuring fans that they will do everything in their power to minimize any adverse effects caused by the ongoing legal dispute.

Despite the legal battles, both the three EXO members and SM Entertainment expressed optimism about the group's future activities. Last Friday, Chen, Baekhyun, and Xiumin released a statement reaffirming their dedication to continue participating in EXO's group activities faithfully and diligently.

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