Between June 5 and June 6 KST, the dispute between EXO members Baekhyun, Xiumin, and Chen and SM Entertainment took on new dimensions after a set of new press releases by both sides.
First, on June 5 KST, it was revealed that Baekhyun, Xiumin, and Chen (hereby referred to as EXO-CBX) had filed a complaint with the Korea Fair Trade Commission in order to hold SM Entertainment accountable for "unfair abuse of bargaining power".
Additionally on June 5 KST, SM Entertainment released a press statement declaring that it will meet the demands of EXO-CBX by providing copies of requested payment records, as long as EXO-CBX sign confidentiality agreements.
Then, early on June 6 KST, EXO-CBX released a formal press statement responding to SM Entertainment's latest position.
During this process, more specific details surrounding the legal dispute between the two sides, and the problems that each side is putting forward, were publicly revealed. This has led many K-netizens following the issue to take different sides, some showing their support for EXO-CBX and some for SM Entertainment.
First, some netizens who have decided to show support for SM Entertainment's side based their understanding of the situation based on these aspects of the agency's latest statements:
1. According to SM Entertainment, artists can invite legal representatives/accounting firm representatives to visit the company as to peruse over payment records and balances as needed.
2. However, EXO-CBX made no attempt to adhere to SM's advice to peruse the records with their legal/accounting representatives first before requesting full copies of all earnings and payments, and continued to only request copies.
3. In order to distribute copies of an artist's [EXO's] earnings and payments, the company must acquire permission to release such documents from all other members, as the complete document will consist of confidential information involving the other members. This was one of the reasons why SM Entertainment denied EXO-CBX's request for copies multiple times.
4. However, due to the persistent requests of EXO-CBX, SM Entertainment has decided to obtain the permission of the other EXO members in order to provide the requested copies to EXO-CBX, despite the fact that confidential financial records of the other EXO members may be jeopardized.
5. According to SM Entertainment, no coercion was involved in the process of negotiating the terms of the exclusive contract renewal with all members of EXO. This is proven by the fact that one member of EXO still has yet to renew his contract, and is currently in the negotiation process.
On the other hand, those netizens showing their support for EXO-CBX's side based their understanding of the situation based on these aspects of CBX's statements:
1. While SM Entertainment claims that the three members of EXO-CBX "voluntarily" renewed their exclusive contracts after a fair negotiation process, according to CBX, there was significant coercion and "gaslighting" involved in the negotiation process.
2. Despite SM Entertainment's coercion, CBX still attempted to negotiate details of the renewal contract 8 times. What they ultimately received in response was that SM Entertainment could not accept any of the suggestions made by CBX.
3. The CBX members were told that "if you do not renew, the other members or even the whole team could suffer negative consequences" and Baekhyun particularly was told, "Baekhyun, if you renew, we can offer the other members this much for their renewal payment". At the time, Baekhyun was still carrying out his mandatory service duties, but felt that he had no choice but to renew his contract early [with approximately a year still remaining before its expiration] in order to protect the team.
4. After Lee Soo Man and his LIKE Holdings controversy, CBX have reason to believe that unexplainable, irrational fees such as "producing fees" or "royalties" exist in their earnings and payment records from the past 12 years.
Meanwhile, the members of EXO most recently bid Kai farewell for a short while for his mandatory enlistment service on May 11 KST.
sme's justification for why they couldn't release these documents to CBX makes no logical sense. there's no way a company can't separate an individual employee's earnings from those of 7 other employees. and lawyers and auditors can come to sme to peruse the documents but can't receive copies of those same documents because suddenly if they leave the building they can't be seen by the same people? okay.
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