ENTERTAINMENT
Legal Battle Between HYBE and Former ADOR CEO Min Hee-jin Reaches Verdict
On the morning of the 12th, the Seoul Central District Court's Civil Division 31 (Presiding Judge Nam In-soo) will announce its ruling on the lawsuit filed by HYBE against Min and others to confirm the termination of the shareholder agreement, as well as the lawsuit filed by Min against HYBE for the payment of stock purchase funds.
This trial is expected to be a legal watershed, determining the validity scope of shareholder agreements based on trust, beyond mere management disputes. The case began in July last year when HYBE notified Min of the contract termination, citing her attempt to privatize ADOR and the resulting damages to the company. Subsequently, Min was dismissed from her CEO position in August of the same year and notified of her put option exercise three months later in November, along with her resignation from the board.
HYBE claims that Min sought concrete plans and actions to independently control ADOR. They argue that evidence from KakaoTalk conversations and internal documents clearly shows attempts to induce the termination of exclusive contracts with NewJeans members and their parents. Therefore, they assert that the breach of trust among major shareholders justifies the contract termination and renders the put option exercise invalid.
Conversely, Min's side refutes any breach of contract, arguing that HYBE fabricated a scenario of equity seizure and management takeover based on private conversations, without any actual investor contact or execution. Min has consistently claimed through three press conferences that HYBE's actions are a smear campaign to 'tame the label.'
The core issue of the ruling is whether the shareholder agreement was lawfully terminated. If the put option is recognized as exercised while the contract was valid, HYBE would be required to pay Min approximately 26 billion KRW (around $260 million) for the stock purchase. The put option amount is calculated based on ADOR's average operating profit over the previous two years and Min's shareholding percentage, according to the shareholder agreement's criteria.
The court has conducted parallel proceedings for both cases, as they address the same contract's validity. This ruling is anticipated to serve as a significant precedent in future entertainment industry disputes over exclusive contracts and shareholder agreements.
Reported by Min Kyung Lee, TenAsia 2min_ror@tenasia.co.kr
