C-JeS Entertainment’s statement on the rectification order made by the FTC on SM Entertainment-KFPCAI for interfering with JYJ’s activities as singers is as follows. (Official statement by CEO Baek Chang Joo)
We would like to thank the FTC for conducting such a transparent investigation for the past three years to eradicate unlawful actions in the industry, collecting evidence of SM Entertainment and principal agents in the culture industry, such as the Korean Federation of Pop Culture and Arts Industries (KFPCAI), unilaterally and systematically interfering with JYJ’s broadcasted appearances.
The investigation gave irrefutable evidence that SM Entertainment had violated the Monopoly Regulation and Fair Trade Act by abusing their monopolistic and superior leverage in the entertainment industry to disadvantage those who have different opinions multiple times. We believe that the FTC’s recent order to rectify such actions will shed light on the tyranny of super powers in the industry who go against the innovative economy policies of the current government.
The development of our nation’s entertainment industry, signified by the Hallyu Wave, will only take place if the creativity and diversity of every participant is respected and guaranteed. This means that we must no longer be swept up in the despotism of the few super powers in the industry. If the Hallyu Wave develops henceforth on the basis of a lawful mould, starting with today’s rectification order, we believe that this will be an opportunity for it to leap forth into the world again.
Although JYJ’s legal dispute with their former agency was concluded in April, JYJ still suffered from unlawful external pressure. Including the unilateral notification they received from their album distribution company recently, it is an undeniable fact that JYJ have unlawfully been restricted from appearing on music programs, even when they release albums. This is an embarrassing truth in our society today. But if policies and institutions continue to be the foundation of change, as they were today, we believe that JYJ will be able to perform on a fair stage in the future.
JYJ’s stance on the verdict is as follows.
“We would like to thank the FTC for their decision. Though it feels as though we have been locked in a hard battle since 2009 and are walking in an endless desert, today’s verdict gave us strength to keep going as it showed that the situation is slowly changing for the better. We hope that the FTC’s verdict will allow us to freely pursue activities in the entertainment industry and stand on a fair stage in front of the public. We also hope that such roads are also opened for our juniors as well.
Although a long and dark tunnel still lies ahead of us, we saw a strand of light in the far distance flash by our eyes. We will continue to walk towards that light, and we will always do our best to repay everyone with great performances and activities.”
<Reference-1 – Information relating to JYJ’s legal dispute and the FTC’s announcement>
On July 31st, 2009, the three members of JYJ claimed that their exclusive contract with SM Entertainment was no longer valid due to unlawful clauses including an extremely long contract period (13 years) that went against the social rules, an extremely biased income distribution that favored the agency, and no freedom with regards to activities during the contract period. Thus, they submitted an injunction to the Seoul District Courts to nullify the validity of their contract and on October 29th, 2009, the Seoul District Courts accepted the trio’s case and their exclusive contract nullification injunction (Seoul District Courts 2009Ka-Hap2869). Since then, the Courts have reconfirmed multiple times through multiple legal disputes between the two parties that their unilateral and forced exclusive contract was no longer valid.
In October of 2012, the FTC announced their new ‘Model standards for business transactions between entertainment management companies, celebrities (and trainees) and production companies’, which was intended to facilitate a fair working environment in the entertainment management business. Since then, entertainment agencies and the awareness of those working in the industry have changed, ensuring legal protection for those newly entering the industry, and providing a stable ground for rookies to pursue activities with no limitations. Today’s announcement by the FTC regarding the unlawful business transaction between JYJ and their former agency has proved that the two parties’ legal dispute has helped eradicate unlawful actions taking place and has become a stepping stone in creating a groundbreaking change in the industry.
<Reference-2 / 2012 November: The end of JYJ – SM Entertainment’s legal dispute>
On July 31st, 2009, the three members of JYJ claimed that their exclusive contract with SM Entertainment was no longer valid due to unlawful clauses including an extremely long contract period (13 years), an extremely biased income distribution that favored the agency, and no freedom with regards to activities during the contract period. Thus, they submitted an injunction to the Seoul District Courts to nullify the validity of their contract and on October 29th, 2009, the 50th Civil Suit Division (Judge Park Byung Dae) of the Seoul District Courts accepted the trio’s case and their exclusive contract nullification injunction (Seoul District Courts 2009KaHap2869). SM Entertainment submitted an appeal against the aforementioned verdict on April 12th, 2010 but was dismissed by the 50th Civil Suit Division (Judge Choi Sung Joon) of the Seoul District Courts on February 15th, 2011. This reconfirmed that the exclusive contract between the trio and SM Entertainment was unlawful, therefore invalid, and the verdict was made that the original verdict would stand. (Seoul District Courts 2010Ka-Hap1245). On February 21st, 2011, the 51st Civil Suit Division (Judge Kim Dae Woong) of the Seoul District Courts came to the verdict that SM Entertainment had been interfering with the trio’s activities in the entertainment industry, which including appearing on broadcasted programs, and ordered the agency not to interfere any more, as well as pay a 20 million Won fine for every instance they are caught violating this verdict henceforth (2010Ta-Gi4495).
Through a voluntary arbitration, in which it was decided that the exclusive contract between the two parties had ended on July 31st, 2009, JYJ became independent from SM Entertainment and were guaranteed the freedom to pursue any and all activities. This concluded the legal dispute between the two parties.
Source: [C-JeS Official Homepage]
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