In the lawsuit regarding a 2.6 billion won put option between former Adore CEO Min Hee-jin and Hybe, various issues such as 'management rights theft', 'slave contract', and 'plagiarism' were raised, showing sharp differences in positions.
On the 11th, the 31st Civil Division of the Seoul Central District Court (Chief Judge Nam In-soo) held a hearing on the confirmation of contract termination and the claim for put option payment between Min and Hybe.
On this day, former CEO Min appeared as a witness, while Hybe selected Chief Legal Officer Jeong Jin-soo as a witness for cross-examination.
CLO Jeong claimed that during past meetings, former CEO Min demanded excessive changes to certain clauses in the shareholders' agreement, including the non-compete clause.
In this regard, former CEO Min has argued that the obligation to comply with the non-compete clause even after exercising the put option is a 'slave contract', stating that this clause unfairly binds her to the company until the point of stock disposal.
Regarding this, CLO Jeong pointed out, "If the contract is modified as Min wants, the CEO would become an omnipotent figure, someone no one can touch."
Former CEO Min highlighted that the album sales of ILYT increased by 80,000 copies on the last day of its initial release, suggesting that Hybe was pushing out the group NewJeans. She reiterated her claim that ILYT plagiarized NewJeans, emphasizing, "This was already a topic of discussion among the public before I expressed my opinion."
In response, CLO Jeong stated, "Any idol group will always have comments like 'they are similar to someone'. I don't understand what authoritative opinion this is," claiming it was part of Min's plan to create an 'Adore shell.'
In response to Jeong's claims of investor contact and management rights theft, Min countered, "Is there any actual content or data regarding the contact? Please submit it." She raised her voice, stating, "It's almost like a soap opera written by a writer of Im Sung-han. They are creating a story to oust me."
The court will conduct additional witness examination of former CEO Min on November 27. After that, the arguments are expected to conclude on December 18, with a ruling anticipated in January next year.
This is the first time both parties have faced each other since the conflict between former CEO Min and Hybe erupted in April last year.
Before the legal battle between the two sides, a separate lawsuit regarding the validity of the exclusive contract between NewJeans and Adore was underway in another courtroom of the Central District Court. On that day, both sides had a second mediation session, but it ultimately failed, and a ruling is expected next month. Currently, NewJeans' activities have been suspended based on the court's decision prohibiting the members' independent activities without Adore's approval.
Former CEO Min notified Hybe of the exercise of the put option in November last year. This put option is a key element of the shareholders' agreement Min Hee-jin made with Hybe. According to the contract, upon exercising the put option, Min can receive an amount equal to 75% of her shareholding in Adore multiplied by 13 times the average operating profit of the previous two years.
The basis for the put option calculation that Min notified Hybe is reported to be for the years 2022-2023. At that time, Adore, under Min's leadership, recorded an operating loss of 4 billion won in 2022 and an operating profit of 33.5 billion won in 2023. The loss in 2022 appears to be due to NewJeans' debut in July of that year.
According to the Adore audit report released in April last year, former CEO Min is said to hold 573,160 shares, which is 18% of all Adore shares. Based on this, Min Hee-jin could receive approximately 26 billion won.
Since April last year, former CEO Min has been engaged in a legal battle with Hybe, maintaining sharp differences in positions. At that time, Hybe initiated an audit citing reasons such as management rights theft and breach of trust by the Adore management led by Min. Former CEO Min countered that the core of the conflict was the plagiarism of NewJeans' concept.
Ultimately, Hybe dismissed former CEO Min from her position on August 27 of last year.
[Ji Seung-hoon, Star Today Reporter]
