SM “The FTC’s verdict is unfortunate” VS JYJ “We saw a ray of hope”
The Fair Trade Commission (FTC) laid down a prohibitive order on SM Entertainment and the Korean Federation of Pop Culture and the Arts (KFPCAI) on the 24th. This order prohibited the two parties from interfering with the broadcasted and musical activities of idol group JYJ (Kim Junsu, Park Yoochun, Kim Jaejoong).
In July of 2009, JYJ filed an exclusive contract nullification injunction against SM as members of the idol group TVXQ, claiming that the exclusive contract signed between the two parties was unlawful. Since then, SM and JYJ had been locked in a legal dispute over the validity of their exclusive contract.
According to the FTC, JYJ released their first album in October, 2010, during their lawsuit with SM, and attempted to restart their activities as singers but were met with an official notice by SM and the KFPCAI that asked 26 companies in the broadcasting and distribution industries to refrain from working with JYJ.
Regarding this, the FTC stated, “Considering the leverage that SM Entertainment has as one of the three biggest entertainment agencies in Korea, as well as the specific nature of the KFPCAI as an organization in the entertainment industry, the official notice that was released placed a considerable amount of pressure on the recipients,” and “This incident is significant as it has prohibited a large-scale entertainment agency from using its influence and working with a business organization to prohibit the activities of celebrities currently locked in a legal dispute with the agency.”
The FTC also ordered the KFPCAI to, “notify the 12 business associations in the organization, as well as the 26 licensees who received the official notice, of the corrective measures that have taken place.”
Regarding this order, the FTC explained why they had not made SM pay a fee as they stated, “We do not believe that SM benefitted economically from this event, and we believe that a prohibitive order is enough as a warning for other entertainment agencies as well.”
The most important question surrounding the FTC’s order is whether JYJ will be able to appear on broadcasted shows in the future. As it has now been accepted by the FTC that JYJ have been faced with limitations in their activities, many are wondering if JYJ will finally be able to let their activities take flight.
Regarding this, CEO Baek Chang Joo of C-JeS Entertainment stated, “Although JYJ’s legal dispute with their former agency was concluded in April, JYJ still suffered from unlawful external pressure. Including the unilateral notification they received from their album distribution company recently, it is an undeniable fact that JYJ have unlawfully been restricted from appearing on music programs, even when they release albums.” He also added, “But if policies and institutions continue to be the foundation of change, as they were today, we believe that JYJ will be able to perform on a fair stage in the future.”
JYJ stated, “We hope that the FTC’s verdict will allow us to freely pursue activities in the entertainment industry and to stand on a fair stage in front of the public. Although a long and dark tunnel still lies ahead of us, we saw a strand of light in the far distance flash by our eyes. We will continue to walk towards that light, and we will always do our best to repay everyone with great performances and activities.”
However, SM released an official statement that read, “It is unfortunate that such a verdict was made, although there was no evidence to prove that such interference had taken place,” and “SM is currently reviewing the option of pursuing legal action against this latest decision.”
With such differing stances coming from both sides, there are may opinions surrounding this issue that exist in the industry. The FTC’s order is very meaningful as a symbol, but the opinion is split on whether it will actually translate into change in reality.
One representative in the industry saw the verdict in a positive light as he stated, “The verdict made by the FTC is a symbolic precedent against large-scale, influential entertainment agencies. The entertainment industry is changing from a food chain into an environment that everyone can be a part of.”
On the other hand, another representative believed that the order would not be able to make any lasting change as he stated, “Though the FTC have made their verdict, we still can’t say whether JYJ will be able to appear on variety shows or music programs. The industry has agreed that the issue is whether the broadcasting companies will take the necessary big step.”
One representative of the broadcasting industry gave a more skeptical opinion as he stated, “I’m doubtful that the FTC’s verdict will have a positive effect on JYJ’s broadcasted activities.”
He also added, “Though the FTC has sided with JYJ, what’s important is how SM accepts their verdict. If JYJ are able to freely pursue activities in the industry after the verdict, wouldn’t that basically mean that SM and the KFPCAI admits to interfering with JYJ’s activities? I don’t think it’s a simple problem.”
A representative who works in management at an agency emphasized, “People are curious to see how SM will react as a large-scale entertainment agency. And it’s true that the FTC’s verdict has hurt SM’s image to an extent. But if JYJ were now able to freely pursue activities as singers, SM would no longer be associated with the term ‘Tyranny of super powers’. As the frontrunner of K-pop, SM must make a wise decision.”