Following requests from fans, Herose will be releasing the official documents—the court rulings and settlement agreements from the six civil lawsuits between JYJ and SM, and the Fair Trade Commission (FTC) decision—alongside the material we have obtained and organized with advice from a lawyer.
To simplify the terminology and avoid confusion in the lawsuit documents, which ran from July 31, 2009, to November 28, 2012, we will refer to "the three members of TVXQ" as "JYJ" and "SM Entertainment Co., Ltd. CEO Kim Young-min" (who was either the plaintiff or the defendant) as "구)SM" (former SM).
Most fans are aware of the court's provisional disposition (injunction) decided in October 2009 (Lawsuit #1), which JYJ filed on July 31, 2009, titled "Application for Provisional Disposition Suspending the Validity of the Exclusive Contract." This decision stated that 구)SM must not interfere with JYJ's independent entertainment activities until the main lawsuit was finalized. Furthermore, if 구)SM did interfere, they were ordered to pay 10 million KRW per instance to JYJ.
Lawsuit #2: 구)SM's objection, filed in April 2010, seeking to vacate the first provisional ruling.
Lawsuit #3: 구)SM's application for a provisional disposition to suspend the contract between the JYJ members and their new agency, C-jes.
Lawsuit #4: C-jes's request for indirect compulsion to prevent 구)SM from interfering with JYJ's activities.
Regarding Lawsuits #2 and #3, the court (Seoul District Court Civil Division 50) rejected 구)SM's arguments in February 2011, upholding the validity of the first ruling. For Lawsuit #4, Civil Division 51 issued a decision on indirect enforcement, stating that if 구)SM interfered with JYJ's independent activities, they would have to pay 20 million KRW per instance.
You can understand the decision of indirect compulsion as a court order designed to psychologically pressure the obligor into voluntarily fulfilling their obligation. A provisional disposition is a temporary order issued by the court to protect the rights of the claimant or defendant. This is necessary considering the nature of civil lawsuits, where even the first trial of the main suit can take up to 15 years. Winning a provisional disposition indicates a 90% or higher chance of winning the main lawsuit.
The main lawsuits filed in 2010 were: Lawsuit #5, filed by 구)SM for "Confirmation of the Existence of the Exclusive Contract, etc.," and Lawsuit #6, filed by JYJ for "Confirmation of the Non-Existence of the Exclusive Contract Validity, etc." All six lawsuits were civil, not criminal, cases and were heard by a civil collegiate panel. Lawsuits #5 and #6, covering the same issues, were merged and proceeded together.
On November 28, 2012, both parties concluded the litigation through a settlement. They agreed to terminate the exclusive contract and decided that any financial issues claimed by either side would be handled through the agreement. The agreement document was available for public viewing on the Supreme Court website for three years. Crucially, the parties agreed that the termination date of the exclusive contract was July 31, 2009—the date JYJ filed the provisional disposition application. This means the exclusive contract between JYJ and gu)SM ended retroactively on July 31, 2009.
The seventh legally binding document is the Corrective Order issued by the Fair Trade Commission (FTC), which is an administrative measure. After being reported in 2011 (2011서경1038), the FTC issued a decision in 2013 (Decision 2013-167) concerning "The Korea Federation of Popular Culture and Arts (문산연)'s prohibited acts as a business association and S.M. Entertainment Co., Ltd.'s business activity obstruction." The FTC ordered both parties never to engage in acts obstructing JYJ's entertainment activities again. Furthermore, 문산연, having violated the Monopoly Regulation and Fair Trade Act, was ordered to notify its constituent business operators and those who received documents related to the obstructive acts of the FTC's corrective order in writing, using the text provided by the FTC.
Looking back at the situation during the 2012 settlement, 구)SM had lost the first trial of a similar lawsuit regarding another artist's exclusive contract validity at around that time. JYJ had won all four lawsuits leading up to the settlement. Since the rulings for Lawsuits #1 and #2 already contained judgments on the problems within the exclusive contract, it was widely believed that JYJ winning the main lawsuit was just a matter of time and inevitable. Therefore, many fans couldn't accept the settlement instead of a final court judgment, feeling that justice was not fully served.
Despite the fans' frustration, we found it difficult to understand why 구)SM agreed to settle a civil lawsuit that could have been dragged out for over 10 years if they wanted to. Since broadcasters were using "ongoing litigation" as an excuse to bar JYJ from music and variety shows, JYJ desperately wanted to end the lawsuits quickly. We had thought time was on 구)SM's side, and given their reputation at the time, we expected the lawsuits to last over a decade, which is why we were puzzled when we heard the news of the settlement. While JYJ achieved their goal of terminating the exclusive contract with 구)SM, we wondered what 구)SM had gained.
Since 2011, Herose has consistently filed complaints against malicious commenters and those spreading lies. One case, which went through a formal three-year trial and a Supreme Court ruling, resulted in a criminal penalty. This was the first case in Korea where a third party filed a complaint against a malicious commenter resulting in a criminal conviction, and it became the starting point for third-party complaints by various fandoms afterward, establishing a crucial precedent for punishing malicious commenters. Since then, we have continued to file complaints against malicious commenters and rumor spreaders, and the results of the criminal lawsuits have been announced periodically.
While filing multiple complaints against those who created or spread rumors about the lawsuit, Herose discovered that the full text of the settlement agreement was made public on the Supreme Court website.
After going through the three-year criminal trial against the malicious commenter—criminal trials are handled by the prosecutor and typically end within a year for the first instance—we realized that the fans' complaint of "Why did they settle instead of going all the way?" was based on fan selfishness. Since the most important goal of the lawsuit—the termination of the exclusive contract with gu)SM—was achieved, and Jaejoong gained his freedom, we no longer wanted to think about the lawsuit. For the past decade, we had completely forgotten that we even possessed the settlement document. Fans who endured the last 16 years with us will understand our feelings.
Time has passed, and people who were born after the lawsuit are now debuting and becoming fans. If we hadn't received a request to organize the process by which the unfair exclusive contract between JYJ and gu)SM ended, Herose absolutely would not have opened these documents again.
The environment of the Korean entertainment industry 16 years ago was very different from today. Although standard contracts existed before the 1990s, they were largely ineffective. Even the "Standard Terms and Conditions" presented by the FTC in July 2009, following a tragic actress's death, had few people convinced of its effectiveness. Due to the lawsuit by JYJ, who were top artists at the time, the issues of unfair exclusive contracts and unclear income settlement in the entertainment industry were brought back to public attention on a massive scale. As public pressure intensified, large agencies were compelled to change their contracts sequentially in accordance with the FTC's "Standard Terms and Conditions." That entire process has been documented in news articles.
We plan to upload the extensive content to the Herose homepage in separate sections. We will also link to helpful blogs. The emphasis one places when understanding a text depends on their selective intent. We do not have the ability to educate those who are functionally illiterate or lack contextual understanding. Despite the vexation that the current situation might continue to replicate in the future, we will persist in summarizing the facts and outlining the situation, even after 10, 20, or even 30 years have passed.
Following requests from fans, Herose will be releasing the official documents—the court rulings and settlement agreements from the six civil lawsuits between JYJ and SM, and the Fair Trade Commission (FTC) decision—alongside the material we have obtained and organized with advice from a lawyer.
To simplify the terminology and avoid confusion in the lawsuit documents, which ran from July 31, 2009, to November 28, 2012, we will refer to "the three members of TVXQ" as "JYJ" and "SM Entertainment Co., Ltd. CEO Kim Young-min" (who was either the plaintiff or the defendant) as "구)SM" (former SM).
Most fans are aware of the court's provisional disposition (injunction) decided in October 2009 (Lawsuit #1), which JYJ filed on July 31, 2009, titled "Application for Provisional Disposition Suspending the Validity of the Exclusive Contract." This decision stated that 구)SM must not interfere with JYJ's independent entertainment activities until the main lawsuit was finalized. Furthermore, if 구)SM did interfere, they were ordered to pay 10 million KRW per instance to JYJ.
Lawsuit #2: 구)SM's objection, filed in April 2010, seeking to vacate the first provisional ruling.
Lawsuit #3: 구)SM's application for a provisional disposition to suspend the contract between the JYJ members and their new agency, C-jes.
Lawsuit #4: C-jes's request for indirect compulsion to prevent 구)SM from interfering with JYJ's activities.
Regarding Lawsuits #2 and #3, the court (Seoul District Court Civil Division 50) rejected 구)SM's arguments in February 2011, upholding the validity of the first ruling. For Lawsuit #4, Civil Division 51 issued a decision on indirect enforcement, stating that if 구)SM interfered with JYJ's independent activities, they would have to pay 20 million KRW per instance.
You can understand the decision of indirect compulsion as a court order designed to psychologically pressure the obligor into voluntarily fulfilling their obligation. A provisional disposition is a temporary order issued by the court to protect the rights of the claimant or defendant. This is necessary considering the nature of civil lawsuits, where even the first trial of the main suit can take up to 15 years. Winning a provisional disposition indicates a 90% or higher chance of winning the main lawsuit.
The main lawsuits filed in 2010 were: Lawsuit #5, filed by 구)SM for "Confirmation of the Existence of the Exclusive Contract, etc.," and Lawsuit #6, filed by JYJ for "Confirmation of the Non-Existence of the Exclusive Contract Validity, etc." All six lawsuits were civil, not criminal, cases and were heard by a civil collegiate panel. Lawsuits #5 and #6, covering the same issues, were merged and proceeded together.
On November 28, 2012, both parties concluded the litigation through a settlement. They agreed to terminate the exclusive contract and decided that any financial issues claimed by either side would be handled through the agreement. The agreement document was available for public viewing on the Supreme Court website for three years. Crucially, the parties agreed that the termination date of the exclusive contract was July 31, 2009—the date JYJ filed the provisional disposition application. This means the exclusive contract between JYJ and gu)SM ended retroactively on July 31, 2009.
The seventh legally binding document is the Corrective Order issued by the Fair Trade Commission (FTC), which is an administrative measure. After being reported in 2011 (2011서경1038), the FTC issued a decision in 2013 (Decision 2013-167) concerning "The Korea Federation of Popular Culture and Arts (문산연)'s prohibited acts as a business association and S.M. Entertainment Co., Ltd.'s business activity obstruction." The FTC ordered both parties never to engage in acts obstructing JYJ's entertainment activities again. Furthermore, 문산연, having violated the Monopoly Regulation and Fair Trade Act, was ordered to notify its constituent business operators and those who received documents related to the obstructive acts of the FTC's corrective order in writing, using the text provided by the FTC.
Looking back at the situation during the 2012 settlement, 구)SM had lost the first trial of a similar lawsuit regarding another artist's exclusive contract validity at around that time. JYJ had won all four lawsuits leading up to the settlement. Since the rulings for Lawsuits #1 and #2 already contained judgments on the problems within the exclusive contract, it was widely believed that JYJ winning the main lawsuit was just a matter of time and inevitable. Therefore, many fans couldn't accept the settlement instead of a final court judgment, feeling that justice was not fully served.
Despite the fans' frustration, we found it difficult to understand why 구)SM agreed to settle a civil lawsuit that could have been dragged out for over 10 years if they wanted to. Since broadcasters were using "ongoing litigation" as an excuse to bar JYJ from music and variety shows, JYJ desperately wanted to end the lawsuits quickly. We had thought time was on 구)SM's side, and given their reputation at the time, we expected the lawsuits to last over a decade, which is why we were puzzled when we heard the news of the settlement. While JYJ achieved their goal of terminating the exclusive contract with 구)SM, we wondered what 구)SM had gained.
Since 2011, Herose has consistently filed complaints against malicious commenters and those spreading lies. One case, which went through a formal three-year trial and a Supreme Court ruling, resulted in a criminal penalty. This was the first case in Korea where a third party filed a complaint against a malicious commenter resulting in a criminal conviction, and it became the starting point for third-party complaints by various fandoms afterward, establishing a crucial precedent for punishing malicious commenters. Since then, we have continued to file complaints against malicious commenters and rumor spreaders, and the results of the criminal lawsuits have been announced periodically.
While filing multiple complaints against those who created or spread rumors about the lawsuit, Herose discovered that the full text of the settlement agreement was made public on the Supreme Court website.
After going through the three-year criminal trial against the malicious commenter—criminal trials are handled by the prosecutor and typically end within a year for the first instance—we realized that the fans' complaint of "Why did they settle instead of going all the way?" was based on fan selfishness. Since the most important goal of the lawsuit—the termination of the exclusive contract with gu)SM—was achieved, and Jaejoong gained his freedom, we no longer wanted to think about the lawsuit. For the past decade, we had completely forgotten that we even possessed the settlement document. Fans who endured the last 16 years with us will understand our feelings.
Time has passed, and people who were born after the lawsuit are now debuting and becoming fans. If we hadn't received a request to organize the process by which the unfair exclusive contract between JYJ and gu)SM ended, Herose absolutely would not have opened these documents again.
The environment of the Korean entertainment industry 16 years ago was very different from today. Although standard contracts existed before the 1990s, they were largely ineffective. Even the "Standard Terms and Conditions" presented by the FTC in July 2009, following a tragic actress's death, had few people convinced of its effectiveness. Due to the lawsuit by JYJ, who were top artists at the time, the issues of unfair exclusive contracts and unclear income settlement in the entertainment industry were brought back to public attention on a massive scale. As public pressure intensified, large agencies were compelled to change their contracts sequentially in accordance with the FTC's "Standard Terms and Conditions." That entire process has been documented in news articles.
We plan to upload the extensive content to the Herose homepage in separate sections. We will also link to helpful blogs. The emphasis one places when understanding a text depends on their selective intent. We do not have the ability to educate those who are functionally illiterate or lack contextual understanding. Despite the vexation that the current situation might continue to replicate in the future, we will persist in summarizing the facts and outlining the situation, even after 10, 20, or even 30 years have passed.