“SM Entertainment and EXO-CBX Engage in Legal Battle Over Royalty Dispute”

The K-pop world is currently abuzz with news of a heated legal battle between SM Entertainment and three members of the popular boy band EXO. The dispute between the agency and Chen, Baekhyun, and Xiumin – collectively known as EXO-CBX – has escalated into what can only be described as a “full-on war”.

The crux of the issue lies in a disagreement over intellectual property royalties. SM Entertainment has accused EXO-CBX of failing to pay a 10% royalty fee after leaving the agency to set up their own management company for their solo careers. On the other hand, EXO-CBX claims that SM reneged on a promise to allow them to pay a reduced fee to distribute their music through SM’s majority shareholder Kakao.

Tensions reached a boiling point last week when both sides exchanged heated press statements. SM Entertainment decided to take legal action, stating that “CBX’s nonsensical actions cannot be tolerated anymore”. In response, EXO-CBX announced their intention to countersue and refer SM Entertainment to South Korea’s Fair Trade Commission.

The roots of this dispute can be traced back to last year when EXO-CBX reached a new agreement with SM Entertainment, allowing them to manage their solo careers through their own agency, INB100. Despite the semi-split, the group is still managed by SM Entertainment, but the relationship soured after EXO-CBX accused the agency of mistreatment.

Under the terms of the agreement, EXO-CBX were required to pay a 10% royalty fee to use their stage names and the EXO name for their solo activities. However, they are now refusing to pay this fee, citing SM Entertainment’s alleged failure to uphold the distribution fee agreement.

At a press conference, the President of INB100’s holding company, Cha Ga-won, accused SM Entertainment of breaching the deal by not honoring a 5.5% distribution fee that was verbally promised by the former CEO of SM Entertainment. SM Entertainment refuted these claims, stating that they never had the power to decide the distributor’s fee rate.

As the legal battle unfolds, EXO-CBX has vowed to reveal “everything” that led to their split from SM Entertainment last year. They also plan to report the agency’s alleged unfair exclusive contract to the Fair Trade Commission and seek justice through the legal system.

The outcome of this legal battle could have far-reaching implications, including the potential impact on an upcoming EXO album. Despite their current legal woes, EXO-CBX has expressed their commitment to participating in EXO’s group activities with SM Entertainment in the future. Only time will tell how this bitter dispute will ultimately be resolved.