The Road to the Court: The HYBE Lawsuit and Min Hee Jin’s Petition for Injunction
Author’s note: This is part of a series of posts which details the conflict between HYBE and ADOR.
Part 1
Part 2
Part 3
Part 4
Interlude on Stocks
The feud between HYBE and its subsidiary All Doors One Room (ADOR) led by CEO Min Hee-Jin had become the subject of discussion given its controversial nature. As discussed, this began as a public affair when HYBE demanded for ADOR to open its books and doors for an audit. This is done, however, with good reasons, since HYBE received reports and claims that Min attempted to sell the label to investors and at the same time cause damage to HYBE, with enough reason for the purchase to take place.
HYBE claims to do the audit as a preventive measure, while Min’s defense was that it was an unjust response following a written request to HYBE for company support; more than that, Min sees it as a means to diminish the value of her girl group NewJeans, which, according to her, was plagiarized by Belift Lab, another company within HYBE, in the conception and promotion of new all-girl band ILLIT.
Given this short summary of events, we can then follow what happens after Min’s press conference and the subsequent response of HYBE to Min’s claims and counter-claims. Unfortunately, the exchange between these two companies ended up being a form of publicity war at this point, with details spilled for everybody to see. And while all this happens before the public eye, HYBE continues with the internal audit and makes decisions based on its results.
One such example was HYBE’s statement after Min’s press conference (which was highlighted in the previous blog post), to which in turn ADOR provided another response. Some highlights of ADOR’s public letter includes the following details:
- The baselessness of HYBE’s accusation that ADOR is taking over management rights, adding further that when a senior executive of ADOR approached HYBE’s management to request that HYBE cease the publicity war, the only response the executive got was a form of blackmailing and psychological pressure.
- HYBE’s statement regarding Min’s salary was an obfuscation between her regular income, her stock compensation, and her incentives after NewJean’s success. There was also an extensive discussion about the stock option and the non-compete clause, which, as ADOR clarified, was discussed in-depth between HYBE and Min. The final outcome of this negotiation was that Min did not reject the proposal of HYBE to release the non-competition obligation, against HYBE’s claim. Officially, Min has not responded yet because the 10 percent additional option that HYBE proposed was against the Commercial Code.[1]
- The unreasonable seizure of company laptops during the internal audit, which ADOR felt was unfair because it was done after the supposed “whistleblowing e-mail” that Min sent to HYBE.
- HYBE pulled away their promise of debuting NewJeans as their “first girl group” when they suddenly debuted LE SSERAFIM upon the addition of members Kim Chaewon and Sakura Miyawaki. Min and ADOR clarified that it was in fact the cause, and not the effect of Min’s separation from Source Music, apart from her claim that she had creative differences with its management.
- The overarching point for Min and ADOR is the fact that HYBE released all these issues into the general public days leading to the NewJeans comeback, which they have interpreted as an act done in bad faith. As they have claimed, in an ideal situation, these could have been dealt with internally, avoiding any negative effect on the artists.
All these came out at a time in which HYBE demanded ADOR to call for a board meeting that would supposedly make the decision to oust Min Hee Jin as a CEO. In response, ADOR rejects the proposal and considered it as an “illegal” move, hence filing an injuction which prevents such a board meeting from happening. The issue escalated further when HYBE reported Min Hee Jin to the police, subjecting both parties to interrogation.
The spaces, however, were filled with so much mudslinging and media clout from both sides that it was hard to follow through certain facts. There are, however, things, that would prove to be crucial in the court case.
- In the course of the audit, ADOR released a statement in which it claims that HYBE caused unnecessary distress to an employee in wanting to frame the whole situation against Min and ADOR. HYBE responded by denying these claims.
- A surprising element came in when the parents of NewJeans members came up with a letter addressing HYBE regarding the issue over the alleged plagiarism by BELIFT Labs. In turn, HYBE responded by saying that it has already replied to the parents and addresses the general public that this was a part of Min’s plan to take over ADOR. BELIFT then filed formal complaints against Min and ADOR for the damages caused by their comments (which would soon elevate further into a criminal case)
- The five members of NewJeans — Minji, Danielle, Hanni, Hyein, and Haerin — filed a formal petition to court in support of Min, and has in fact drew flak from fans.
- More screenshots of Min’s chats with ADOR executives and other suspected future shareholders (such as Naver and Dunamu) surfaced, making it even more possible that Min as CEO does not only work toward a possible takeover, but also made shrewd and discriminatory comments against NewJeans themselves. However, Min denied these and claimed that they were clearly taken out of context.
Within these events, however, one important step in the investigation is that HYBE and ADOR were asked to forward evidence in court through hearings. Note that this is a necessary step taken since Min sought the help of the courts to obtain an injunction, which in turn prevents HYBE from calling a board meeting which specifically aims to depose Min as CEO of ADOR. In other words, the exchange of information and rhetoric has now been raised to the legal level, with each side needing to present their cases formally.
HYBE presented the evidence that it has gathered from the audit, which included several screenshots of conversations over Kakao Talk as mentioned above. Some news joints have reported how Bang Shi Hyuk made certain comments regarding Min in the police interrogation, but this seems to be irrelevant to the matter at hand as it belongs to the realm of personal opinion.
Summing this up, these will all be relevant heading into the date in which the court decides regarding ADOR and Min’s request for citing an injunction.
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[1] Soompi’s summary of the statement of ADOR showed that as per legal advice, majority shareholders cannot own said stock options. In effect, ADOR perceives that HYBE intended to deceive ADOR and Min on this matter. I put this on footnote because I need more research on this matter.