EXO-CBX and SM Entertainment fail to reach settlement in first mediation

    EXO-CBX and SM Entertainment were unable to reach a compromise in their ongoing legal disputes.


    The 15th Civil Division of the Seoul Eastern District Court, presided over by Judge Cho Yong Rae, held the first mediation session on September 23 regarding SM’s lawsuit against EXO-CBX for contract fulfillment. The court also reviewed EXO-CBX’s claim for unpaid settlements.


    The private mediation lasted approximately 30 minutes and was attended only by the legal representatives of both parties. No agreement was reached. The court has scheduled the second mediation session for October 10.


    In June 2023, EXO-CBX formally notified SM of their intention to terminate their exclusive contract, citing SM’s failure to provide accurate settlement data. They also filed a complaint with the Korea Fair Trade Commission.


    Subsequently, the two sides agreed to maintain the exclusive contract for group activities with EXO, while EXO-CBX decided to pursue individual activities under their new agency, INB100. However, in April of last year, SM filed a lawsuit against EXO-CBX, alleging that EXO-CBX failed to pay 10% of earnings from individual activities as previously agreed.


    EXO-CBX countered with a lawsuit of their own, seeking legal resolution on the settlement dispute. On October 1, the court consolidated both lawsuits and referred them to the mediation process.


    Source: https://www.allkpop.com/articl…lement-in-first-mediation


    ExoLTaglist

    Quote from selfmate

    is it because the prior agreement is pretty much set in stone?


    Quote from sonemariam

    How do you know?


    I think Baekhyun alone has some power to fight SM. If he didn't, they wouldn't have left to begin with.

    it's my opinion of course. the 10% royalty fee and the 5.5% distribution fee are not legally linked. cbx agreed to pay 10% ip fees. the 5.5% distribution fee with kakao was never part of the written settlement. sm explained that they couldn’t guarantee it because it depended on kakao to give them a 5.5% deal, and thus is was excluded from the final agreement. cbx knew the 5.5% was not in the written contract, signed it, then stopped paying the 10% ip fees over the 5.5% that they knew was not guaranteed in the contract. their lawyer sucks ass imo

    Quote from NightChamp

    it's my opinion of course. the 10% royalty fee and the 5.5% distribution fee are not legally linked. cbx agreed to pay 10% ip fees. the 5.5% distribution fee with kakao was never part of the written settlement. sm explained that they couldn’t guarantee it because it depended on kakao to give them a 5.5% deal, and thus is was excluded from the final agreement. cbx knew the 5.5% was not in the written contract, signed it, then stopped paying the 10% ip fees over the 5.5% that they knew was not guaranteed in the contract. their lawyer sucks ass imo

    SM was ok with the 5.5% royalty fee until they weren't. Why did they say yes verbally and then made it 10% in the contract? Why not say no from the beginning?


    Edit: That's proof that SM is trying to cheat the CBX like they did EXO.

    Quote from sonemariam

    SM was ok with the 5.5% royalty fee until they weren't. Why did they say yes verbally and then made it 10% in the contract? Why not say no from the beginning?


    Edit: That's proof that SM is trying to cheat the CBX like they did EXO.

    sm never agreed to 5.5% ip fees ?


    there are two separate :

    10% ip fees : this is what cbx is supposed to pay sm. this was always set at 10% in the written contract, and cbx signed it.

    5.5% kakao album distribution fee : this is what kakao charges for distributing albums (the 5.5% is a preferential rate, and cbx wanted that preferential rate). sm explained to cbx that they couldn’t guarantee that rate because it’s kakao’s decision, not sm’s. that’s why it wasn’t written into the contract.


    so cbx knew : they had to pay 10% ip fees. the kakao distribution discount was not guaranteed (it literally was not in the contract). the problem is cbx stopped paying the 10% they legally agreed to, because of a separate fee that they didn't get (the 5.5% kakao album distribution deal) that wasn’t even in the contract. whether or not the 5.5% was indeed verbally promise (sm publically denied that) or ever materialized is irrelevant, cbx's legal duty to pay the 10% still stands.

    Weren't CBX still under SM when the 5.5% deal was discussed/negotiated or whatever? Wasn't SM responsible for helping them secure safe and honest deals as their agency? If SM didn't help them do that then why get paid the 10% ip fees?

Participate now!

Don’t have an account yet? Register yourself now and be a part of our community!

Register Yourself Login