The legality of the termination of the shareholders' agreement and the obligation for the put option payment are central issues.
This ruling could influence future dispute resolution methods in the Korean entertainment industry.
The legal battle between HYBE and former Atador CEO Min Hee-jin reaches a pivotal moment. The Seoul Central District Court is set to deliver its first verdict on the 12th regarding the termination of their shareholders' agreement. This ruling is poised to serve as a critical juncture on whether the termination was legally justified and the obligations related to the substantial payout from the put option.
The contentious lawsuit originated from the termination of the shareholder agreement between HYBE and Min. In July 2024, HYBE terminated the agreement, and in November, Min stated she would resign from her position as inside director of Atador and terminate the shareholder pact. Both parties accuse each other of being responsible for the contract breach. HYBE claims that Min attempted to usurp management and harmed the company, justifying the termination. Conversely, Min counters this as mere speculative slander, maintaining that the termination notice is invalid.
The core issue at court centers on whether the contract is valid and if the put option claim can be exercised. If the court recognizes HYBE's termination as valid, Min's claimed rights to the put option may be extinguished. The calculation for the put option is based on operating profits from 2022 to 2023, and HYBE could potentially owe Min around 26 billion won. The claims from both sides will likely have significant impacts on future stock trading and management rights, depending on the court's ruling.
This courtroom conflict showcases a larger issue surrounding shareholder and management tensions beyond mere contract termination. The relationship between HYBE and Min Hee-jin serves as a symbolic case in the Korean music industry, bringing to light the legal and ethical dimensions of contract validity. This ruling could set a precedent for similar cases in the future, thus influencing dispute resolution methods between companies.
The court's ruling could significantly alter both HYBE’s and Min's financial circumstances. If Min's put option is recognized, it could not only provide her with a means of recouping financial losses but also highlight similar rights for other shareholders. Conversely, if the court maintains the validity of the termination notice, HYBE might secure an opportunity for stable management going forward.
Ultimately, this case could become an important milestone that reshapes the landscape of the Korean entertainment industry, influencing the interplay between shareholders and management. It's crucial to observe how the court's findings will affect the overall industry and the reinvigoration of relationships between shareholders and leadership roles.
This article is KOSTAR’s reinterpretation of a story originally reported by TVDaily.
Photo: TVDaily
