Seoul Court Slaps Down Exclusivity Clause in TVXQ contract

The Court has released a partial ruling in the case between TVXQ and SM Entertainment. In their partial ruling, according to translated reports, The Court has slapped down SM’s right to control the external activities of TVXQ.

TVXQ filed to have the exclusivity part of their contract terminated. In other words, they had to go to court to keep SM from having a say in the things they do which have absolutely nothing to do with SM.

This Exclusivity clause gave SM the right to say what activities the members could or couldn’t be involved in which had nothing to do with SM or with their SM-activities as singers. Such activities would include things like investing in other companies, starting side businesses unrelated to music, etc.

According to translated reports, the Court basically called some of the clauses in TVXQ’s contract immoral. The Court said:

“We see that part of the terms in their contract has much destroyed the good morals of the whole contract. SM Entertainment should not interfere with its singers’ independent unique activities and also contract to perform and other entertainment activities.”

The Court has yet to make a final decision about other aspects of TVXQ’s petitions and warns SM not to block TVXQ’s right to engage in independent activities:

“Until the court will pass a final judgment about the main proposal lawsuit, SM Ent. should not make contract about any activities without proposers’ agreement, also should not block proposers’ independent entertainment activities.”

Because the court has partially ruled in TVXQ’s favor, their attorneys announced that the three guys (Jaejoong, Junsu and Yoochun) may sue SM for money damages.

In a phone conversation as reported by Yeonhap News, the lawyer for TVXQ stated:

“We will be suing for compensation for damages incurred due to the unlawful income distribution method set by SM Entertainment.”

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