It is not the first time that entertainment label SM Entertainment has been sued over unfair contracts.
Former Super Junior member Hangeng previously filed a lawsuit against the entertainment giant as profits from the band’s albums and singles were “not fairly distributed among the members”.
But what came as a shock is the announcement made by EXO-CBX, a subunit of members Chen, Baekhyun and Xiumin, stating that they will be terminating their contracts with SM Entertainment. They will also be filing a lawsuit against the company.
HallyuSG explains why all these are happening, especially since the members are signed under the label for more than a decade.
Why is EXO-CBX suing SM Entertainment?
The trio’s decision to take legal action against SM Entertainment is mainly backed by two reasons. Failure to provide transparency and unreasonably long contract durations.
Since 21 Mar, EXO-CBX has requested the provision of accounting receipts detailing how their salaries were calculated. They requested for the documents to be provided by the end of the month.
But they did not receive any documents from the label, which prompted them to terminate their contracts.
Provision of these documents is not only required by law but also an obligation to the trio written out in the contract. It stated that artists should receive a full accounting twice a year.
However, SM Entertainment never provided said documents for the whole duration of which EXO was active. This raised doubts that band members had been unfairly paid.
The Fair Trade Commission’s recommended contract period for pop culture artists is seven years. However, the entertainment label’s contract period typically lasts 12 to 13 years. And it is trying to extend contract periods even longer, by making artists sign subsequent exclusive contracts.
The lawyer representing EXO-CBX, Lee Jae-hak from law firm L&L, said this is “SM Entertainment’s repeated and extremely unfair tyranny against its artists”.
SM Entertainment’s response?
SM Entertainment also released its own response to rebut the lawyer’s statement. The label will allow the artists to view the accounting documents. But not permit them to share the documents with external parties.
It also accused EXO-CBX of being influenced by external parties to request the provision of settlement documents.
The label also later highlighted that it is unreasonable for artists to suddenly claim that the contract’s duration is unfairly long when attorneys from a large law firm were present during the signing of contracts.
Fans have started trending hashtags “#WeStandWithEXO” and “#WeStandWithCBX” on social media platforms to show their support for EXO-CBX. And they hope that EXO will stay as a whole despite the fiasco.
We stand with XIUMIN, BAEKHYUN and CHEN both as individual artists and members of EXO.
— EXO GLOBAL (@EXOGlobal) June 3, 2023
Fortunately, EXO-CBX also assured fans that they will find ways to continue their activities with EXO even after terminating their contract with the company. They are also grateful for the love and support fans have shown them all this while.