[Op-ed] A Cosmetic(s) Discourse, Part II: On Legal Entities and the Pursuit of Happiness

A Cosmetic(s) Discourse, Part II:

Yo’ Mama is More Relevant

In the first part of this series, we deconstructed the very cosmetic cosmetics discourse. Uncovering its argument structure, we determined that it suffered logical flaws in its attempt to prove that it was the members of JYJ and their involvement in a cosmetics business that caused the current 3:2 split of TVXQ. However, although we have challenged its argument process, we have yet to directly challenge the argument itself. In this second part of the series on the cosmetics discourse, I will start pointing out major problems with the assertion itself that Jaejoong, Junsu and Yoochun’s involvement as individual investors in Crebeau caused the current crisis of Dong Bang Shin Ki.

Real Person v. Fake Person

Proponents of the cosmetics discourse, including SM Entertainment, like to assert that the members of JYJ left SM to pursue their investment in the cosmetics business, and because the trio left SM they also left Dong Bang Shin Ki, consequently breaking up the group. The underlying assumption here is that SM and Dong Bang Shin Ki are one and the same; that since SM “created” Dong Bang Shin Ki, the group cannot exist outside of SM.

However, SM Entertainment and TVXQ are two separate and different legal entities, having different rights and obligations in conformity to their different and very separate legal statuses. The members of TVXQ, as flesh-and-blood human beings, are natural persons whereas SM Entertainment, as a non-human corporation, is regarded as an artificial (in more ways than one) person or as having legal personality[i]. Already the assertion pushed by the cosmetics discourse that JYJ leaving SM broke up Dong Bang Shin Ki is on shaky ground. SM Entertainment and Dong Bang Shin Ki are not one and the same; it is perfectly possible for the group to exist and pursue activities as TVXQ outside of SM. In fact, one of SM’s former idol groups, Shinhwa, is doing just that: the group is no longer under or with SM but continue to function as Shinhwa, even with their members in different management companies. Recently, another idol group, SS501, also split into different management companies but continue to exist together as SS501; this doctrine of legal personality clearly differentiates their management companies from the idol group. Consequently, it is also possible for any or all members of Dong Bang Shin Ki to leave SM Entertainment but continue to be part of Dong Bang Shin Ki. In fact, this is what the members of JYJ wanted[ii] [iii]. The problem, therefore, could only lie in SM’s obstinate refusal. In this context, there is no problem with JYJ’s assertion that they left SM, not TVXQ, and that they are still TVXQ members.

This fundamental legal construct of natural v. artificial personality is also present in the reasoning behind the rejection (twice) of SM’s application to trademark the name Dong Bang Shin Ki in traditional Chinese characters. As patent lawyer Jeon Sojeong points out, “What Dong Bang Shin Ki’s management company SM Entertainment failed to recognise is that the very act on their part of filing an application for trademark registration for ‘Dong Bang Shin Ki’ underscored the fact that Dong Bang Shin Ki and SM Entertainment are clearly two separate legal entities…[iv]

Further conversations with a colleague in a reputable law school in Korea and another in a reputable law school in the United States revealed that SM can never claim complete and irreversible ownership of Dong Bang Shin Ki in any form. The most that SM can claim are limited rights to use the name of the group for promotional and related business activities; this is essentially what registration of a trademark is. Korean patent law makes it clear that when a trademark is connected in any way with a famous natural person even this right is not absolute. The more the general public associates a registered name with the famous person to whom it refers instead of the management company that registered the name, the final say lies with that person. In other words, at this point, if the members of JYJ object to the way SM is using any variation of the name ‘Dong Bang Shin Ki’ or their stage names there’s a high chance of them winning against SM. If the trio ever do raise objections, it’ll be clear for all to see that TVXQ and SM are separate and independent entities, with or without a cosmetics business in the picture.

The Pursuit of Happiness 101

For all its claims that it isn’t against celebrities making personal investments, the cosmetics discourse sure likes to take a mick out of JYJ’s investments in Crebeau. It essentially puts forth the idea that the act of investing in a side business represents a conflict of interests for singers such as the three members of Dong Bang Shin Ki. As such, it erroneously asserts that SM Entertainment had the right and obligation to intervene but the obstinacy of the three members in disregarding their management company and continuing their investments caused the breakup of TVXQ.

First of all, the three members of Dong Bang Shin Ki invested as individuals, not as representatives of SM or even as representatives of their group. This is something even SM has thus far not challenged. Therefore, there is no conflict of interest. Kim Jaejoong, Park Yoochun and Kim Junsu as three individuals and recognised citizens of a modern, capitalist, democratic State known as the Republic of Korea—or South Korea in the vernacular—whose Constitution guarantees the right to pursue economic wellbeing and happiness (Preamble, Article 10)[v] were exercising a basic right when they invested in Crebeau cosmetics. Though the three were respectful enough toward their management to seek and obtain its permission before entering this personal venture[vi], they did not need to. No matter how sacred a long-term exclusive contract is, it doesn’t trump the Constitution of the Republic of Korea.

Unless SM Entertainment, in its capacity as a legal person, had participated in the same investments with the trio through official contractual channels, it had absolutely no right to interfere in their personal investments. Notwithstanding the trio’s basic rights as South Korean citizens, SM Entertainment, in not making an investment itself in Crebeau, did not incur any risk. Any risk, loss or gain as well as the responsibilities that come along with it would have fallen squarely on the individuals making the investment, in this case Jaejoong, Yoochun and Junsu, and no one else. This is not even legalese. This is straight-up common sense…no liability, no right to interfere.

Even if, as SM claims, the cosmetic business were involved in criminal activity, SM still has no right to interfere in the trio’s private lives the way it did. In that case, SM should have (and would have if there were no other ulterior motive) referred this to the relevant national authorities. Or has the company become so caught up in its self-imposed image of Town and Kingdom that it disregards completely the State and Government that make it possible for the company to function? Now that is true ungratefulness. If indeed the cosmetics business turned out to be dodgy and it became publicly known, causing a media pandemonium that threatened to tarnish TVXQ’s image, this would reflect badly on SM’s management skills in the PR department, not on the act of the three members investing or their right to do so.

No wonder the Korean public attorney dismissed SM’s charges against Crebeau and sent SM away with a sharp telling-off on mishandling the affair PR-wise, abusing Korean governmental authority for its own petty agenda and neglecting the appropriate legal channels for dispute resolution[vii].

The Economics of Hallyu-land

The cosmetic discourse’s insistence that SM had the right and obligation to interfere in Jaejoong, Junsu and Yoochun’s side business rings even more ridiculous when observing the behaviour of the Korean entertainment industry’s representative celebrities. Almost all of them have invested in a side business; many of them have even gone beyond that to own their own business, openly using their celebrity status, name and portrait rights in operating their ventures. Movie actors, television actors and singers alike engage in this activity, since these side businesses serve in many ways as their back-up plan should their fame fade or their career suffer a downturn. Singer Baik Jiyoung operates a fashion outlet; Hallyu stars Kwon Sangwoo and Jeong Wooseong have—heaven forbid!—invested in cosmetics companies[viii]. And yet their managements aren’t making a big fuss, and they certainly aren’t getting their knickers in a bundle about the potential damage to image should the investments of their contracted artists flop miserably.

If anything, the management of the actors and singers who invest in side businesses seem to stake their reputation on how well it handles these failures. Actor and comedian Lee Kyeonggyu owns and has invested in dozens of side businesses from fried chicken to pizzas to rice rolls, slapping on his face and name on every one[ix]. For every successful investment, he has had at least 10 failures[x]. Yet, the Korean public wasn’t aware of this until he himself confessed it, with his own mouth, on national television. Until that point, his management had done such a good job hiding and handling the failures that it was only through someone who knew someone who knew someone who knew someone close to Lee Kyeonggyu that anyone heard a hint—“I hear the reason why Lee Kyeonggyu is now back on TV so much is because he failed in so many of his investments, he needs to make it back up.”

Are we to believe that SM Entertainment, the industry leader in the Korean market for the management of Hallyu musicians, couldn’t do the same?

The Management of Yo’ Mama

Therefore, if it is such common practice for Korean celebrities to freely exercise their basic right to invest (many of them in cosmetics companies just like JYJ’s) under a legal system that recognises them as separate and independent agents, why is it proving to be so difficult for the members of JYJ? Wherein lies the difference between JYJ’s case and those of the aforementioned Korean entertainers?

It is, in fact, in their management. The management of practically all the Korean actors and singers mentioned above operate differently from that of Dong Bang Shin Ki’s. Many of them are closer in nature to the American agency—much like C-JeS Entertainment—and those that are still considered traditional Korean management companies appear to have a vastly different business philosophy when it comes to managing their contracted artists. Apparently, they don’t suffer from bi-polar disorder when it comes to allowing their artists to pursue supplementary economic activities; they understand the privileges and limitations of their legal personality when it comes to interfering in the private lives of their charges; and they certainly don’t threaten or blackmail their artists into choosing between their career as entertainers and their side business. SM Entertainment has not only committed all these acts considered taboo by their peers but has made it physically (although not legally) impossible for the members of JYJ to continue as members of Dong Bang Shin Ki, and this is what caused the breakup of Dong Bang Shin Ki.

In the end, it was SM Entertainment that split up Dong Bang Shin Ki.

The cosmetics business is about as relevant to the discussion as a ‘Yo’ Mama’ joke.

Written by: Jimmie of TheJYJFiles

Shared by: TheJYJFiles

Please do not add/remove credits


29 thoughts on “[Op-ed] A Cosmetic(s) Discourse, Part II: On Legal Entities and the Pursuit of Happiness

  1. Absolutely right. ¿Who gave SM the right to own DBSK (JYJ) boys in flesh,bones and soul? Not even God considers himself as our owner, so he gave us the right to think and choose freely. ¿Is SM over God? ¿Who the hell do SM’s owners think they are? I think they’re a bunch of abusive and dishonest people. ¡Shame on their heads!

  2. thank you~ I wanted to ask if similar articles are being spread around in Korea, Japan and China? If not by you, are there websites like this or journalists who write similar pieces to the public and the fans?

  3. I know right. Other groups break out from their management companies and still using the name for their group yet SM makes it seem like the name belongs to them when it’s not.
    The thing is, other groups get away easily because they are not DBSK…DBSK is the main money maker for SM and so SM is bitter. Hangeng gets away just fine. They let him go after a few months of the lawsuit. He filed his case after JYJ yet he breaks free first. His single right now outsells the Super Junior ‘s single because of the support of Chinese fans.
    SM can totally let go of JYJ like they did to Hangeng but they won’t because Hangeng leaving didn’t affect Suju at all ..with JYJ, we already see the result now.
    I believe the judge can make righteous decision. Every adult should know SM is pushing the issue because they are seeking revenge, not because of anything now. Last time they said they would welcome Hangeng back if he apologized for his action to SM…and I don’t think Hangeng would ever come back to SM.

    Many A list celebs sure invest in different things but mostly actors and actresses. They have more freedom in K entertainment compared to idols. I don’t see many idols do their own investments unless they open their own company (Shinhwa). I guess Chun sees it that’s why he guided his brother to acting instead.

    *sighs* The whole issue would have been better if the 5 guys stick together and fight together instead of standing 3 and 2 but I guess it’s life…nothing can ever be perfect. What’s done is done.

  4. I couldn’t help but read this with a huge smile on my face. Each argument statement scored a point. They are human beings, and as such, citizens of a country whose Constitution grants them the rights to excercise their choices on how to spend their money (what little they get that is).

    Anyone who thinks these 3 exceptionally talented young men, who have endured as much as they have, to be on a stage to do what they love best, to leave it all for an investment in a cosmetic business, is not playing with a full deck. Or are being incredibly disengenuious.

    “Apparently, they don’t suffer from bi-polar disorder when it comes to allowing their artists to pursue supplementary economic activities; they understand the privileges and limitations of their legal personality when it comes to interfering in the private lives of their charges; and they certainly don’t threaten or blackmail their artists into choosing between their career as entertainers and their side business. ”

    Ah, herein lies the entire crux of the matter – not being able to manage ‘utter and complete control’ of every aspect of the lives of their charges, was driving SME insane! This is afterall, what the whole music idol structure is about – CONTROL. They have to control everything in order to keep the profits for themselves. Not being able to let go, they are placing themselves on that slippery slope to deconstructing. It couldn’t happen to a more deserving bunch of bloodsuckers! I would love to spray that slope with some oil, to speed up the process.

    “In the end, it was SM Entertainment that split up Dong Bang Shin Ki.” — The Law of Unexpected Intentions

    “The cosmetics business is about as relevant to the discussion as a ‘Yo’ Mama’ joke.” — I haven’t done this since I was a kid….. “Hey SME, yo’ Mama”! Gosh, that felt good.

    • I totally, totally, totally agree with U!! Plus, i think SME wanted to make an example of JYJ to show others what would happen if they would try to break away!! well, sme the joke is on U~~~betcha didn’t see that one comin!! hehehe
      ooo yeah, and SME~~~yo Mama!!! that DID feel good!! ^_~

      thank U Jimmy and staff on the superb job ur doing!! ^_~


    • “I would love to spray that slope with some oil, to speed up the process.”

      That just made my day hahaha! 😀

      “In the end, it was SM Entertainment that split up Dong Bang Shin Ki.”

      Great Op-Ed here Jimmie, as always. That is the plain and simple truth, here’s hoping the courts will recognize this.

  5. Thanks again, (and again) for your article. Your legal expertise and explanation have been very illuminating and constantly help non-legal people like me to understand and break down some of that legalese barrier. Beyond that, however, this case has always been quite straight forward for me. It just takes common sense to understand what is truly going on here with JYJ/DBSK and what SM is pathetically (and vindictively) trying to do. I completely understand why JYJ felt that they had no other choice other than to leave, and for that I applaud them for their courage. I am glad to hear that more and more people are starting to “get it” too and understand what JYJ has had to go through for the past 2 years. I just hope this legal battle will be put to rest, once and for all, and that these 3 young men can finally forge ahead with their lives. Out with the old (SM) and in with the new: freedom of choice, freedom as artists, and life on their terms. JYJ all the way!

  6. In the end, it was SM Entertainment that split up Dong Bang Shin Ki. <<<< SUMMED IT ALL UP!
    Wonderful article that is so well written.
    The use of 'Yo’ Mama' cracked me up!
    Hope you write more Jimmie ❤

  7. Good points.
    Apparently, they don’t suffer from bi-polar disorder when it comes to allowing their artists to pursue supplementary economic activities
    I don’t understand the relevance of a mental illness in this context.

    • “Bi-polar disorder” is a descriptive term that references rapid shifts in mood or attitude from one extreme to another. It does most commonly reference the mental illnesses that exhibit these symptoms, but it has become a common rhetorical device to use the term to describe any extreme vacillation in attitude or position without any apparent cause of the changes.

      Is the use of the term insensitive to the mentally ill? I think that depends on how it is used. I see it as being simply descriptive in this context as the sentence goes on to describe in what regard the symptoms are being manifest: “when it comes to allowing their artists to pursue supplementary economic activities”

      • I think it’s possible to describe how companies view the supplementary economic activities of their artists without reducing bipolar disorder as a mere mood shift from one extreme to another. It’s more complicated than that.

  8. After reading this and several articles before in both JYJ fansite, homin fansite, or the so called neutral fansite, I just wish Homin hadn’t agreed to make a comeback under DBSK name…

    DBSK become legend with 5 people… Jaejoong, Yunho, Yoochun, Junsu, and Changmin… Call me delusional, but I believe that’s what DBSK should be…

    I’m not saying that Yunho and Changmin should wait and do nothing with their career… I want them to be active too be it in drama, modeling or music scene… I just wish they not using DBSK name…
    People say and prove so many times that they have the same right to use the name as much as JYJ do… I couldn’t agree more… But, it’s not our rights that determine who we are, but our choice and action…
    Well, some might say it’s their life, just let them be…
    I say: It’s my life… It’s ok right if I say that I’m disappointed and can no longer support them as much as I support JYJ?

    About SM… *sigh*
    I understand that they are a company… But, please… can’t they just respect their employee choice?

  9. “it was SM Entertainment that split up Dong Bang Shin Ki” – I came to this decision some time ago after thinking over the information availble out there, and now your recent articles, both translated and your own, confirmed that I wasn’t wrong in my understanding of what’s going on.
    Thank you.

  10. Jimmie, this is great! I love your writing for both content and form. Since you’ve clearly put more than a little thought into these issues, and have some legal resources at your disposal, a question: Does Korean law include the notion of “punitive damages” in any way? *hope* *hope*. IF JYJ wins the suit, can they go back after SME for their abusive, predatory, and cartel-like behavior post-split?

    Thanks again.

  11. I’ve run out of praises to say!
    This was a great punctuation to the Part One, Jimmie-yah!
    Good work! I love you guys so so SOOOOO MUCH~!!!!!!!!!!!!

  12. two thumbs for you guys… take that SME… all the blame that cause Dong Bang Shinki to breakup is because of the same company that trained them… did it ever occur to SME that it would all be going back to them… all the blame and the problem that cause JYJ to file lawsuit against them… what goes around, comes around… thanks Jimmie-yah for a job well done on this article… My guts are telling me that this lawsuit would soon be over and the 5 of them would be together again….

  13. In the end, it was SM Entertainment that split up Dong Bang Shin Ki.

    *This*. Yes.

    Another great thoughtful and thought-provoking piece! Thank you!

  14. This article begs the question, what was SM’s real reason for behaving so badly towards DBSK. SM seems to do a good job with the initial phases of raising up artists, it hires people with considerable talent and who seem to be nice people. SM management and staff seem to be reasonable people until the group gets successful. Then they want to harness them so they don’t get too creative on their own, disallow their creative input when they obviously could do well on their own, then steal their money to pay exorbitant executive salaries and bonuses. The whole business plan seems designed for failure.

    • Haha…yup, those who fail to plan (wisely), plan to fail. SM acted out of FEAR, such Losers (place capital ‘L’ right angle thumb and index finger on my forehead)

    • IMHO, I think for SME and the other cohorts who follow this business model, the greed factor is TOO strong. They don’t really care about these artists as people, they are products, money-making machines. When you value the bottom line – profit – before you value the worth of these young people as humans, to me, that speaks volumes.

      The intense fight to hang onto this model should be a clue. All companies want to be successful. It’s how you get to this success that is important. Those companies, no matter what their line of business, who treat their employees fairly, will still reap the benefits of the hard work they put out. They will also reap something else, the respect of their employees.

      The leaders/owners of these Korean music entertainment companies, have seen so much monetary success, they are blinded. As long as they can control every aspect of the operation, no one can question what goes on.

      “Then they want to harness them so they don’t get too creative on their own, disallow their creative input when they obviously could do well on their own, then steal their money to pay exorbitant executive salaries and bonuses. The whole business plan seems designed for failure.”

      If they don’t adhere to this, they will lose CONTROL. What they did not take into consideration – each time they develop a new group – and have to go through the process of forcing them down – H.O.T., JTL, Shinwa, JYJ/DBSK – they run the risk of meeting that one combination which will blow this whole game up – JYJ/DBSK.

      They finally met the ones, and this group has enough loyal, faithful, patient, hardworking, intelligent, and savvy fans who will not capitulate, nor allow JYJ to capitulate. So, that destiny of failure is right around the corner.

  15. An other great article, thanks for sharing it Jimmie.

    I also want to post some comments I read on AllKPop, they were written by AKTKC7 and I just love this person’s comments SFM so I want to spread them. They are very pertinent too and make a lot of good points :

    1) ” @Ioana Nicolae :

    Actually even if JYJ lose the lawsuit they will not necessarily have to go back to SM but they’ll have to pay the penalty for breach of contract which is over 130 billion won.

    About the comestic business the court already dismissed SM’s lawsuit against Crebeau and stated that SM’s claims that JYJ only left because of Crebeau were groundless since there wasn’t enough evidences that JYJ were heavily involved in the company and that Crebeau could harm TVXQ and SM’s reputation.

    The amount to pay for breach of contract in JYJ’s case is more than enough for me to be convinced that JYJ didn’t want to leave SM because of Crebeau or because they are greedy and want more money since when they decided to leave and to fill an injuction against SM and then to fill a lawsuit there was no guarantees that they would be successful and that they would win the lawsuit (and until now nothing is sure yet).
    So they took a big risk, even if they have money JYJ obviously can’t afford paying 130 billion won each (and not even their investments in Crebeau can earn them enough money to pay such a huge amount of money).

    When you see the difficulties JYJ have to face now and the mess they are in, I believe it’s enough to dissuade other artists to fill a lawsuit against their company. Plus the penalty artists would have to pay for breach of contract is surely very dissuasive too. Knowing how big SM is in South Korea not all idols would be willing to risk to lose their support.
    It doesn’t mean all is well in the world with SM.
    JTL didn’t fill a lawsuit against SM, even if they were part of H.O.T., one of the biggest success of SM and the hottest boysband at their time. When they left SM they were finally able to say what they truly think of the company and it wasn’t pretty.
    Shinhwa also got problems with SM.
    Even Isak (who is still in SM), said in an interview (on MTV Iggy) that they are sometimes treated like products and that when they sign the contract there are a lot of things they don’t know.

    Eugene, who was part of SM’s successful girls group S.E.S. also showed her support for JYJ and disapproved with SM’s methods in several interviews (you can find the whole interviews on internet since I’m not allowed to post links on AllKPop) :

    “Eugene said, “It is true that SM have a good training system for a big company. With that, there are many youths who wants to debut under these big companies and there are many cases of them signing long term exclusive contracts with the company. When the singers grow and develop, the contract should also change if not there will be piled-up unhappiness. It is a shame that companies take advantages of the weaknesses of these new singers.”

    She added, “Recently when I look at the juniors, it seems that their schedule is so tight they can hardly breathe. It would be great if they are able to find happiness and influence through their entertainer activitise and at the same time are able to improve on things like profits etc.” ”

    and : ” SES Eugene expressed sadness regarding contract conflicts between Dong Bang Shin Ki and SM Entertainment.

    In the recent SPN interview with Eugene, she said “Not only Dong Bang Shin Ki, there are many entertainers are undergoing a contract relation difficulties. It’s more like the artist who is engaged to the contract is not familiar with the contract itself.”

    “Being compared to the past, I don’t know if improvement has already been made. The past period contract was relatively too long and not flexible.”

    Eugene explained the reason why after a rookie gained popularity, he/she tends to involve in conflict with the agency, “When being a rookie, you don’t know anything. The officers asked to hold the contract term and conditions without any understandings from the artist. However, when the artist has already been aware, he/she finally read carefully the agreement details in the contract, that’s when most likely conflict starts to arise.”

    “It’s also because the contract difficulty which rookie are having difficulties to follow. Agency should consider to set more flexible terms and conditions that has variables to adapt depending on the changing environments.”

    Source: SPN”

    Heechul himself admitted that he, sometimes, also has problems with the company.
    Hangeng also left because he wasn’t entirely satisfied with SM.

    BoA is a shareholder of SM so it’s obvious she won’t leave (same as Kangta).

    As much as I love Suju I don’t think all the members are talented enough to be able to go solo or survive without SM backing them up. (and I would say the same goes for SNSD, not all of them have the capacity to be great artists without SM, I’m not hating on them, I’m not an anti, but that’s what I think.)

    And an interesting thing to note is that there is a clause of confidentiality in SM’s contracts. Idols cannot talk about the internal affairs of SM, what happens in SM stays in SM…(at least until their contract with SM end)

    You can’t deny there are problems with the korean entertainment system. I know there is no such thing as the perfect company but the way artists/idols are treated in South Korea is not normal nor fair. Korean idols/celebs getting hospitalized is a common thing (recently Donghae got hospitalized because of his intense promotional activities with Super Junior M for their comeback), IV shots are the norm (again Yunho got some for his comeback too since he was sick), 3/4 hours of sleep per night is considered as normal too and they are also far from getting the freedom and the liberty of choice american or european celebs have (and of course they certainly don’t earn as much money as them). They also have to perform while being sick and injured (and the mere fact that so many idols get injured or have back pain etc. is a proof that their bodies are pushed to their limits). Idols fainting or collapsing (like Krystal from f(x) for example) due to tiredness or stress is quite frequent too. And some of them also have to go through the famous “Water Diet” while following packed schedules which cause them a lot of health problems.
    And let’s not forget the number of korean celebs who killed themselves because of too much pressure and cuz they were overworked…

    Of course, it’s not only SM but the whole system which has to be reformed but since this system is profitable for the entertainment companies they are firmly opposed to any changes and use their power to prevent them. ”

    2) ” @happy-go-lucky :

    The entertainment world IS a mafia and is probably one of the most shady and corrupted business. About a decade ago, Time Asia wrote an article on the issue, you can still find it on their website, but if you’re too lazy to check the original source here it is :

    “Flying Too High?

    The Korean pop music biz is Asia’s hottest. A police investigation is now revealing that producers and artists may have been buying their way to the top

    By Donald Macintyre Seoul.

    It’s not easy being god. Wherever south Korea’s hottest boy band goes, its members are assailed by heaving, hormonal throngs of teenage girls, all of them aching to rip out a lock of pop idol hair. The house on the outskirts of Seoul shared by the quintet was burgled a year ago—the only things missing were socks and underwear purloined from the washing machine. The singers’ work schedule is grueling. God (an acronym for Groove OverDose) this month embarked on a 100-concert tour that, counting a break to cut their fifth album, will last at least six months. Meanwhile, there are endless rounds of TV appearances, talk shows, dance routines, silly comedy skits. Grouses Yoon Kye Sang, the band’s 22-year-old rapper: “We are only tantara”—Korean slang that loosely translates as itinerant lounge lizards.

    The band members aren’t even allowed to have girlfriends, lest they lose their boy-next-door wholesomeness. But to this list of indignities, add one that could make the others seem genuinely insignificant. South Korea’s star-making machinery that, by cranking out high-gloss acts such as god and femme songstress BoA, has become a regional music-marketing powerhouse rivaling Japan’s, is getting spattered with grime. Last week, government agents arrested two former television producers for accepting under-the-table payments guaranteeing TV appearances to aspiring singers and musicians. According to Seoul District Prosecutor Kim Kyu Hun, the arrests of Hwang Yong Woo and Kim Jong Jin were just the first in a wide-ranging investigation into systemic corruption in South Korea’s music business that threatens to disrupt the careers of some of Asia’s best-loved performers.

    Earlier this month, agents descended on the offices of four major entertainment production companies—SidusHQ, god’s management agency; GM Planning; Doremi Music Publishing; and SM Entertainment, the country’s leading production house whose founder, Lee Su Man, is widely credited with turning Korea’s pop music industry into Big Business. Investigators seized documents and computer discs in search of evidence, carting them away in cardboard boxes. At least eight companies—including four not yet named—are under suspicion. Kim, the lead prosecutor, says the total amount of bribes being paid by music moguls to executives at major television networks and cable TV stations is “huge.” Industry observers say it runs into millions of dollars’ worth of freebies, company stock and raw cash—in one case, wads of bills delivered in shopping bags. “No other industry has so much blatant in-your-face payola,” says a music business insider who spoke on condition of anonymity.

    To many, it’s no surprise that glamorous K-pop has an unsavory side. The music industries in Japan and the U.S. have periodically been rocked by bribery scandals. Payoffs offer a time-honored competitive edge; a well-placed bribe to a highly rated radio station or TV program can buy your unknown talent the audience face time needed for superstardom. But this head-start program for precocious singers is illegal. “Our focus is to sever the collusive ties between the TV executives and the production companies,” says Kim.

    Few stars are expected to be caught in the net. Members of god have not been implicated. But at least one Korean singer—also not yet named—and her manager have been called for questioning by prosecutors. “If there is something bad, I hope the roots get pulled out,” says Jang Woo Hyuk, singer for boy band J.T.L. “But I hope the investigation doesn’t get overexaggerated.”

    You say that SM is only a “small medium” company and doesn’t hold that much power but I have to disagree. Sure, compared to american companies SM can be called a “small medium” company but in South Korea they are huge. YG, JYP and SM are not called the “Three Big” for no reasons.
    And as the article above shows, entertainment production companies and broadcast stations as well as television and radio networks ARE tightly tied together.
    Plus, we already had examples of companies cockblocking and blacklisting their ex-artists in the past. For example, when Ami Uzuki sued her company and filled for a termination of contract and then won her lawsuit she had problems to be signed again, to appear on TV and on radio and her career was almost put to an end because of it. Here is an extract from the article on Wikipedia :

    “In 2000 the young singer’s career came to an abrupt halt when Eiji Yamada, the President of her production company AG Communication, was convicted on tax evasion charges. AG Communication was avoiding tax by underreporting their earnings, and by consequence were underpaying royalties to artists. Suzuki Ami’s parents sued AG Communication for termination of her contract on these grounds, and that association would taint her squeaky clean image. The Tokyo District Court found in her favor, but the lawsuit resulted in Ami Suzuki’s blacklisting because of an unwritten rule of the entertainment business in Japan: artists who get into legal disputes with their masters are blacklisted.[17] In court documents it was revealed that AG Communication was paying her very little to begin with: Despite eight-figure record sales that year, Ami Suzuki earned just $1500 a month at the start of her career, and a minuscule 0.4% royalty rate on CDs, raised to $9780 and 0.55% in 1999.[18]

    Ami was faced with the problem of production companies refusing to sign her in and she tried to make a comeback in the next two years with little to no success. Her relationship with her producer, Tetsuya Komuro, also ceased. Many people were convinced that her chances for making a comeback were nil.[19] In 2003, Ami finally negotiated an out-of-court agreement with Sony. Her contract with the label was scheduled to end in December 2004 with no singles or albums released after 2001 by Sony due to her blacklisting.[19]

    Eiji Yamada was subsequently fined for his role in the tax evasion. Government officials linked to the scandal included former Education Minister Takashi Kosugi and two other legislators, who allegedly received 34 million yen in unofficial payments for referring AG Communication and other clients seeking tax evasion.[20]

    Particular credit for covering Suzuki Ami’s legal problems goes to music journalists Steve McClure writing for the Japan Times and Rori Caffrey for the Daily Yomiuri. The blacklisting was not discussed in the mainstream Japanese Press, and McClure himself was warned against reporting it.[17]”

    Then when H.O.T. disbanded, the 3 members who left SM (Tony An, Jang Woo Hyuk and Lee Jae Won) formed JTL and they were also cockblocked. They couldn’t appear on any shows hosted or guested by SM artists (radio or TV) and so they failed miserably and soon had to disband and went solo. Even now, we don’t hear much from them.

    About truetvxq I agree that Precious has some facts but I read the whole translation he did of the contract and it still doesn’t seem fair to me.
    I have friends studying law and one of them wants to work in the business law field and an other in the entertainment law so I showed them the contract and they discussed it. Their conclusion was that the contract is indeed unfair.
    First, the contract is one-sided : it only protects SM’s interests and focuses on the members’s obligations and commitments without really stating their rights.
    Then the working hours are not clearly stated (even an average employee knows how many hours/days he is supposed to work per days/months).
    Plus the penalty for breach of contract is definitely too high (who can afford to pay over 130 billion won ? Even if they got money it’s obvious JYJ can’t).
    The members also have pratically no liberties and no say regarding their activities and apparitions on TV or radio shows.
    Of course the percentage they got on the CD Sales is very low and then had to be divided between the 5 members.
    I know they got a much bigger percentage on their japanese sales but let’s not forget that if SM only took a minor share here, SM Japan and Avex also took their own shares which divides the percentage the 5 members got even more (and then, as usual, it is also divided between the 5 members themselves).
    Furthermore, even Precious admitted that JYJ (and so HoMin too), didn’t see the contract with Avex since it was signed solely between SM Japan and Avex. Knowing that the 5 boys worked a lot in Japan I don’t think it was very comfortable or fair for them not to know the exact terms of the contract and what exactly was going on there.
    Then the contract doesn’t explain nor precise what and how expenses are deduced from the members’s pay (what is considered as expenses ? how are they calculated ?).

    About the Crebeau issue (since if you read truetvxq I guess you consider it as the reason why JYJ want to leave SM) Seoul Central District’s attorney has already dismissed the lawsuit SM filled against Crebeau and ruled that SM don’t have enough evidences proving that Crebeau could harm SM and TVXQ’s reputation and that JYJ left because of their investments in Crebeau. You can find both the original and the translation of the official court’s decision on TVXQ DC Gallery and thejyjfiles.

    And isn’t it ironic how fans often complain, saying that their idols look too tired, that their schedules are too packed and tight, that they are perfoming while being sick/injured etc. and then when idols decide to leave the company which treats them like products (dixit Isak herself, read her interview on MTV Iggy) some fans turn their backs on them and act as if everything is well with the wonderful world of entertainment.

    Companies are not friendly, they are not a family, they are here to make profits and that’s it. There is no betrayal or loyalty because this is business we are talking about. Artists may need companies to support them but companies are making money on their artists’s backs, not the contrary.
    Idols are employees too and every employee is allowed to resign and leave when he feels like he isn’t treated properly or deserve better.
    Artists leaving their companies before the end of their contracts is nothing new, it happens a lot in Europe and in the US. But, in Asia it is immediately considered as being ungrateful and the artists who dare leaving are labelled as greedy, money whores and betrayers. It’s just plain sad.

    Sorry for the long rant but the whole issue can’t be summed up in 3 lines.”

    3) ” Companies claiming that they invest a lot in their groups and that they lose money by doing so always make me laugh. Do people really believe that if companies were losing money they would keep running this kind of business ? Do you think that if training young teens was so expensive they would keep scouting and accepting so many of them. If this system wasn’t profitable for the companies then they would have changed it by now.
    Training is not an obligation, there are a lot of talented people out there and you don’t need to train them for 3,4,5,6 years or more before debuting them (look at the european or american companies).
    And talking about betrayal is BS, a company is a business, not your family or your friend ! Don’t get fooled by the whole “family” scheme, this is just marketting, companies are here to make profits, not to give love to some teens whose dream is to become famous. They don’t train all these young people because they want them to be happy or to offer them a “family” but because they know these teens will eventually earn them more money than what they invested in them.
    People also need to realize that switching companies is not such a big deal in other parts of the world, but if you want to leave your company in Asia then you’re greedy, traitors etc., and as a consequence you’re blacklisted and cockblocked by these companies (just like what happened to Ami Uzuki, JTL or JYJ). Sure the companies train them and pay for some of their expenses (but not all, because a lot of expenses are actually deduced from the idols’s pay, just read Isak’s interview on MTV Iggy) but without the idols they wouldn’t be making any money.
    Companies need the idols too, it’s not only the idols who need companies. If people feel that they are not treated correctly and don’t get the money they deserve then they are free to leave. Even a normal employee is allowed to quit his company if he isn’t happy anymore or feel that he deserves better.
    And it’s funny how fans often complain about how their idols look too tired, have packed schedules, perfom while being sick/injured and then when these idols decide to do something against it, saying that they don’t want to be treated like products anymore, some fans turn their backs on them and act as if all is well with the fantastic world of entertainment.”

    Sorry if it’s too long, I hope the admins won’t consider it as spamming cuz I think these comments are really interesting to read.

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