EXO-CBX members escalate legal feud with counter-suit against SM
What's the story
EXO-CBX members Chen, Baekhyun, and Xiumin have escalated their legal tussle with former agency SM Entertainment (SME) by filing a counter-lawsuit.
The South Korean news outlet Newsis reported on Thursday that the trio is seeking compensation based on accurate settlement data for their 12-13 years under an exclusive contract with SME.
This move is in response to a lawsuit filed by SME earlier this month demanding the members fulfill due payments outlined in a previously settled contract.
Fraud allegations
INB100, EXO-CBX filed criminal complaint against SME executives
EXO-CBX's current management company, INB100, has disputed SME's claims and filed a criminal complaint against the agency's co-CEOs Lee Sung-soo and Tak Young-jun.
The complaint alleges fraud under the Act on the Aggravated Punishment of Specific Economic Crimes.
This legal action was lodged at Seoul Seongdong Police Station, adding another layer to the ongoing legal battle between EXO-CBX and their former agency.
Contract controversy
Dispute over revenue share sparked legal battle
The legal dispute was ignited when INB100 revealed alleged unfair practices by SME at a press conference on June 10, 2024.
According to INB100, despite settling contract disputes last year which ensured EXO's continuity, SME now demands 10% of individual artist revenue.
This contradicts previous agreements that only required a payment of 5.5%.
INB100 sent an official objection to this demand but received no response from SME for over two months.
Agency's stand
SME refuted allegations, stood firm on contract terms
SME has refuted the allegations made by INB100 and EXO-CBX, stating that they will not tolerate the group's denial of contract terms.
The agency emphasized that EXO-CBX agreed to the terms and voluntarily signed the contract.
According to SME, the 10% royalty standard for individual activities stems from a previous court arbitration involving EXO's Chinese members.
Legal turn
EXO-CBX aims to change SME's profit distribution practices
The legal dispute took a dramatic turn on June 25 when EXO-CBX and INB100 filed a complaint against SME's executives, alleging fraud and financial misconduct.
The complaint focused on discrepancies related to the negotiated distribution fees.
In a statement, EXO-CBX and INB100 pledged to cooperate fully with authorities and disclose all relevant details, including last year's negotiations, to substantiate their claims.
They also indicated their intent to challenge SME's profit distribution practices in court.