The Korea Music Content Association (KMCA) expressed regret over the first trial ruling related to the shareholder agreement between HYBE and former ADOR CEO Min Hee Jin, following the judgment in favor of former CEO Min Hee Jin.
On the 20th, the KMCA conveyed its official position regarding the sustainable development of the music industry and the protection of industrial order through an official press release.
The KMCA stated, “Upon learning of the first trial ruling between HYBE and former (ADOR) CEO Min Hee Jin, as an organization striving for the advancement and promotion of the K-pop industry, we express deep concern. The K-Entertainment industry, which today commands global attention and acclaim, has grown based on mutual trust between capital investors and contributors of capabilities. Talent rarely flourishes without investment, and investment without the contribution of capabilities holds no meaning. Regardless of scale, these essential partnerships are indispensable.”
They added, “At the core of the K-pop industry is a structure where entertainment companies bear substantial initial investments and risks at uncertain early stages, sharing subsequent realized achievements through contracts and trust. If this structure wavers, the sustainability of the industry inevitably suffers severe impacts.”
Regarding the ruling, KMCA expressed concern that the standard for judging “breakdown of trust relations” significantly diverges from the industry’s perspective, viewing the essential act of breaking trust too narrowly, while simultaneously setting the judgment criteria excessively high. This raises the likelihood that actions perceived by the industry as tampering—inducing exclusive contract breaches during the contract period—may be misinterpreted as legitimate management actions or be accepted without substantial responsibility.
They questioned whether a CEO’s fiduciary duty to the company and shareholders, as required by commercial law, can coexist with tampering. Such a premise fundamentally denies contractual order and investment stability, destabilizing the foundation of the K-pop industry.
As with all industries, trust is fundamental in K-pop. If affiliate company CEOs or key executives improperly use unfair means to extract successful artist IPs and seek independence for new enterprises, it will significantly undermine governance stability and investment predictability across the industry. Such behavior will trigger reduced industry investment, harming small agencies, rookie artist development, and all industry workers. If such actions are tolerated, what investor will endure long-term uncertainty to invest capital in nurturing new artists and launching new labels? When capital dries up, small agencies, rookie development, and many industry workers will be the first to falter.
The KMCA considers this issue not just a K-pop industry matter. In all content and intellectual property (IP)-based industries that operate on contracts, how much conflict of interest and trust breaches by key personnel are tolerated shapes the overall market norms. Once a precedent is set, it influences broader transactional practices and investment decisions across the industry.
Tampering is not a mere contractual dispute but a fatal act that completely destroys industry trust and fundamentally undermines the long-term pre-investment structure.
The KMCA strongly urges that future legal proceedings, including appeals, carefully consider the impact of this case not only on K-pop but on all IP-related industries. Especially in the K-pop industry, which has grown on trust between investors and producers, they hope that the meaning of “breakdown of trust relations” and the executive’s fiduciary duty and conflict of interest prevention obligations are not diminished to mere formalities, but rather clearly and balanced standards are established. Additionally, the KMCA pledges to make every effort to establish industry order and protect production systems to prevent the spread of tampering and similar acts that could destabilize the foundation of Korea’s K-pop industry.