K-pop girl group NewJeans loses in contract validity lawsuit vs ADOR
K-pop girl group NewJeans lost in a court case about the validity of their exclusive contract with agency ADOR, a subsidiary of Korean entertainment company HYBE.
On Oct. 30, the 41st Civil Division of the Seoul Central District Court ruled in favor of ADOR, declaring that the 2022 exclusive contract of the five NewJeans members–Minji, Hanni, Danielle, Haerin and Hyein–signed under ADOR is valid.
"The exclusive contract between ADOR and NewJeans that was signed in 2022 is valid. NewJeans will bear the legal costs,” the court ruled, Korean media reported.
The court ruled that ADOR’s audit and dismissal of former CEO Min Hee-jin were justified and the reasons stated by NewJeans in seeking the termination of their contract was not acceptable.
The ruling was handed down after the second mediation hearing between ADOR and NewJeans failed.
In November last year, NewJeans declared that they terminated their exclusive contract with ADOR, claiming the agency violated the terms.
ADOR filed a civil lawsuit last December “in which the company sought a declaration affirming the validity of its exclusive contracts with the NewJeans members.”
A Korean media news report stated that in ruling in favor of ADOR, the court rejected all NewJeans’ claims for the termination of their exclusive contract, including the production gap caused by Min Hee-jin's dismissal; the leak of photos and videos of NewJeans during their Source Music trainee days; the HYBE PR representative's disparaging remarks about NewJeans' achievements; Belift Lab girl group ILLIT’s attempts to undermine and replace NewJeans' uniqueness; Hanni's accusations that ILLIT’s manager told them to “ignore” her; and the deletion of NewJeans' work due to the "Dolphin Kidnapping Group" [Dolphiners Films] dispute.
About Min Hee-jin, the court ruled, "The mere fact that NewJeans has high trust in Min Hee-jin does not constitute a significant obligation under the exclusive contract for ADOR to preserve her position as CEO."
On the remarks by HYBE’s PR representative on NewJeans, the court concluded that they were merely an attempt to correct the underlying facts and not an attempt to defame or insult NewJeans.
Regarding the dispute with Dolphin Kidnapping Group, the court stated, "The contract between ADOR and Dolphin Kidnapping Group stipulates that ownership and intellectual property rights arising from the performance of the contract belong to the plaintiff [ADOR], and Dolphin Kidnapping Group cannot distribute or post such material online without the plaintiff's prior consent."
"HYBE invested 21 billion won [about $14.7 million] in NewJeans. NewJeans achieved significant success since their debut, so it's difficult to understand why they're abandoning NewJeans and focusing on other idols," the court stated.
The court also rejected NewJeans' persistent argument that "the trust relationship with ADOR was broken."
"In summary, HYBE's audit of Min Hee-jin cannot be considered a retaliatory audit that destroyed the trust between ADOR and NewJeans. NewJeans claimed that ADOR and HYBE conducted a retaliatory audit of Min Hee-jin during a critical period of new album release and music show promotions. However, since Min Hee-jin initiated the public opinion war, this argument cannot be accepted," the court said.
It said, “NewJeans asserted its decision-making authority regarding personnel and content production after building sufficient popularity and fandom through the exclusive contract. When this decision was rejected, it claimed a violation of personal rights. If the validity of the exclusive contract, which is based on free will, is denied, it would be tantamount to an attempt to break the contract without just cause. Therefore, this unreasonable demand cannot be accepted."
NewJeans will appeal the court decision.
The law firm representing NewJeans said, "The members respect the court's decision, but given the complete breakdown of trust with ADOR, it is impossible for them to return to ADOR and continue their normal entertainment activities. We hope the appellate court will comprehensively review the facts and the legal principles regarding the termination of their exclusive contract and render a wise ruling."