SM Entertainment has issued a detailed statement in response to the allegations made by EXO members Chen, Baekhyun, and Xiumin during a press conference held on June 10. The press conference, organized by the legal representatives of the three artists, accused SM Entertainment of breaching settlement terms. In a swift rebuttal, SM Entertainment expressed regret over the content and manner of the press conference, and clarified their stance on the matter.
SM Entertainment began by addressing the core issue, which they claim is the unfair inducement by MC Mong and Cha Ga Won towards their artists. According to SM, MC Mong and Cha Ga Won have been approaching several artists under valid exclusive contracts with the company. This led to EXO-CBX (Chen, Baekhyun, and Xiumin) attempting to invalidate their renewal contracts. Despite this, SM Entertainment stated that they listened to the concerns of EXO-CBX and allowed them to conduct individual activities independently, with the agreement that 10 percent of the revenue from these activities would be paid to SM.
SM Entertainment emphasized that this agreement was made to avoid disrupting EXO’s group activities and to be fair to other members and fans. However, they revealed that INB100, the agency representing EXO-CBX, is now a subsidiary of MC Mong and Cha Ga Won. This revelation confirmed SM’s suspicions of tampering. SM had previously refrained from raising this issue publicly to protect EXO, but the press conference forced them to address it.
The company also accused EXO-CBX of enjoying the rights and benefits of being EXO members while ignoring their contractual obligations. SM pointed out that after signing the agreement, EXO-CBX engaged in various individual activities, including music and album distribution, concerts, and broadcasts. The 10 percent payment was a standard derived from court mediation during a previous contract dispute with EXO’s Chinese members and was mutually agreed upon during the negotiation process with EXO-CBX.
Despite this, INB100 sent a certification of contents indicating that the agreement need not be upheld, suggesting that EXO-CBX wanted to enjoy the benefits without fulfilling their obligations. SM Entertainment chose not to raise the issue earlier to avoid disrupting the solo activities of other EXO members, but they now accuse EXO-CBX of distorting their efforts.
SM Entertainment also refuted claims made by INB100 regarding the distribution commission rate. They clarified that they do not have the authority to determine the rates of other distribution companies. During the agreement process, EXO-CBX had requested to include the distribution commission rate as a condition, but SM explained that it could not be included and excluded it from the final agreement.
SM further stated that they made other accommodations for EXO-CBX, such as allowing Baekhyun’s solo album to be released under his own agency and covering the cancellation fee for a Japanese concert. They emphasized that EXO-CBX and INB100 signed contracts under favorable conditions with another distribution company, ensuring smooth music and album distribution without any particular losses.
In response to the press conference, SM Entertainment expressed their inability to tolerate EXO-CBX’s repeated claims of invalidating the renewal contract. They accused EXO-CBX of manipulating public opinion to justify their actions and stated that they would respond calmly according to the law and principles, holding EXO-CBX accountable through the courts.
On June 11, a media outlet reported that EXO was originally in talks to release music in winter, but the plan might be difficult to carry out due to the ongoing dispute. In response, INB100 released a statement clarifying that the press conference was held to inform the public about the unfairness of paying 10 percent of the artists’ individual earnings to SM, who they claim first breached the agreement. They assured fans that this issue has no relation to EXO’s full group activities and promised to participate earnestly in future group activities with SM.
SM Entertainment briefly responded, confirming that they are planning the release of EXO’s music and that there have been no further discussions about changes to the plan.
