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Posted by Sophie-Ha Tuesday, August 29, 2023

ATTRAKT could potentially claim 51 Billion KRW ($38.7 million) compensation from FIFTY FIFTY for damages

AKP STAFF

FIFTY FIFTY's predicament continues to worsen as its original agency, ATTRAKT, can potentially demand substantial compensation. This amount could potentially ascend to hundreds of billions of KRW.

The exact amount of compensation that ATTRAKT can claim from FIFTY FIFTY members can be very substantial, according to the guidelines provided in the Standard Exclusive Contract for Popular Culture Artists. 

Article 15(1) of this contract stipulates that if either party (the management company or the artist) breaches the terms of the agreement, the affected party can request a 14-day grace period for the offender to correct the violation. Should the transgression remain unresolved within this timeframe, the upset party reserves the right to dissolve or cancel the contract and be entitled to claim damages.

Furthermore, Article 15(2) of the same clause asserts that an artist must compensate the management company, even if the latter fulfills its contractual obligations, if the artist breaches the contract for the purpose of unilaterally terminating it during the contract term. The artist is expected to pay the planning agency damages equivalent to the remaining months multiplied by the average monthly revenue for the previous two years plus the damages specified in Article 15(1).

First, the significant amount of damages can be estimated based on Article 15(1). However, as FIFTY FIFTY has not publically disclosed the revenue specifics of their music albums, speculative estimates can only be based on the known earnings of comparable artists.

FIFTY FIFTY, which debuted in November 2022, is believed to have generated sales of at least tens of billions of KRW with "Cupid." This song has been performing impressively on the Billboard charts, causing some analysts to estimate sales reaching hundreds of billions of KRW. With FIFTY FIFTY's revenue from their debut estimated at approximately 4.5 billion KRW (~3.4 million USD), and considering the standard idol contract duration of seven years, the potential compensation ATTRAKT could lay claim to could total a staggering 23.6 billion KRW (~17.9 million USD). 

This figure could potentially inflate to as much as 51.1 billion KRW (~38.7 million USD) if FIFTY FIFTY's revenue is assumed to be 10 billion KRW (~7.6 million USD). Even further, should ATTRAKT demand additional compensation for felt damages resulting from FIFTY FIFTY's perceived wrongdoing or negligence, the total sum could be astronomical.

Furthermore, ATTRAKT can potentially include additional claims to cover additional damages incurred, such as direct and indirect investment costs, damages due to FIFTY FIFTY rejecting advertisements, and losses incurred through the suspension of overseas marketing. 

It is known that ATTRAKT invested approximately 8 billion KRW to debut Fifty Fifty. Additionally, it was reported that CEO Jun Hong Joon raised 90 million KRW by selling his car and watch to cover expenses such as FIFTY FIFTY's monthly rent and training.


Thus, with the compilation of the penalty, the actual damages, and additional costs, ATTRAKT could potentially ask for hundreds of billions of KRW in compensation from the FIFTY FIFTY members. This could generate a severe impact on the artists involved and the entertainment industry at large.

Following the rejection of FIFTY FIFTY's application for a provisional injunction to terminate their exclusive contract against ATTRAKT, the situation appears to be worsening for FIFTY FIFTY in this dispute. 

Legal experts have also pointed this out. Lawyer An Se Hoon from the law firm Jeonghyang recently stated on his YouTube channel, "If we estimate FIFTY FIFTY's revenue at 30 billion KRW, the compensation could amount to approximately 300 billion KRW." He also mentioned that although courts often reduce the amount of compensation in favor of artists, the FIFTY FIFTY case appears to be different.

He further stated, "The penalty is less likely to be reduced according to the Supreme Court's precedent, and with a higher percentage of penalties, it is more likely that they will have to bear compensation ranging from tens of billions to hundreds of billions of KRW." He emphasized, "This case is likely to become a historic precedent in the entertainment industry."

  1. FIFTY FIFTY
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goury
goury1,415 pts Tuesday, August 29, 2023 3
Tuesday, August 29, 2023

Attrakt should go for it. TBH it has come to the point that even if they came back to Attrakt, it's too late. They are done in the industry. But Attrakt should be properly compensated. Also, Attrakt should also take as much compensation from The Givers too.

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theLastSprite
theLastSprite1,257 pts Tuesday, August 29, 2023 4
Tuesday, August 29, 2023

they did that to themselves. if they weren’t greedy and selfish, they could’ve been very successful. but ofc money ruins it right?

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