Lee Seung-gi Wins 'Settlement Lawsuit' Against Former Agency Again... Ruling Orders Payment of 690 Million Won

[Financial News] Singer and actor Lee Seung-gi has effectively won again the lawsuit he filed against his former agency, Hook Entertainment Co., Ltd. (currently Chorokbaem Media), regarding music royalty settlements.
According to Yonhap News Agency and others on the 5th, the 20th Civil Division of the Seoul Central District Court (Presiding Judge Kim Min-cheol) ruled partially in favor of the plaintiff on the 28th of last month in the lawsuit filed by Lee Seung-gi against Hook Entertainment Co., Ltd. for settlement money, etc.
The court awarded approximately 690 million won out of the approximately 830 million won claimed by Lee Seung-gi.
Lee Seung-gi filed a lawsuit demanding the distribution of profits, claiming that Hook Entertainment Co., Ltd. had continued to earn revenue from music and albums even after the termination of his exclusive contract in December 2022.
The exclusive contract they signed contained a clause stating that "if sales are generated after the termination of the contract, settlement will be made through a separate agreement."
Hook Entertainment Co., Ltd. argued that now that the exclusive contract had ended, there was no obligation to settle any profits generated thereafter unless a separate agreement was reached.
However, the court ruled in favor of Lee Seung-gi. This was because the agency must bear the obligation to settle accounts, even if a separate settlement agreement was not reached.
The court pointed out, "By using definitive expressions such as 'settles' instead of provisional expressions such as 'may settle' in the main text of the exclusive contract, it clarifies that settlement between the plaintiff and the defendant must be performed upon the occurrence of sales."
At the same time, the court pointed out that if interpreted according to Hook Entertainment Co., Ltd.'s claims, "the defendant would be able to acquire 100% of the profits obtained from the plaintiff's entertainment activities without any settlement by inducing the early termination of the contract, such as by failing to fulfill obligations, and then refusing to agree to a settlement."
The court further ruled, "This results in the party failing to perform the contract obtaining greater benefits than in the case of compliance, which is a significant violation of the principles of good faith and equity."
The court ruled that the cause of the termination of their exclusive contract lay with Hook Entertainment Co., Ltd., citing the fact that the agency had not settled music and album revenues for Lee Seung-gi for about 20 years and had not provided settlement data related thereto despite Lee Seung-gi's continuous requests.
Lee Seung-gi's side initially demanded a distribution ratio of 70% of sales until the expiration of the exclusive contract in August 2024, and 50% thereafter. However, the court recognized 60% and 40%, respectively, taking into account industry practices where settlements are typically made at a lower rate than before after the termination of a contract.
Previously, Lee Seung-gi sent a certified letter to Hook Entertainment Co., Ltd. in November 2022, claiming that he had not received a single penny in settlement for music usage fees since his debut. Subsequently, Hook Entertainment Co., Ltd. paid approximately 5.4 billion won in settlements based on its own calculations and filed a lawsuit to confirm the non-existence of debt, stating it would "confirm that there are no further debts," to which Lee Seung-gi's side also filed a counterclaim.
Last April, the first trial ruled that Hook Entertainment Co., Ltd. must pay Lee Seung-gi an additional 580 million won in advertising fees. As neither side appealed this ruling, it became final.
[email protected] Kim Su-yeon Reporter