FIFTY FIFTY is accused of being ineligible for settlement! Record company blasts: Initially, investment was made to Ha Sung Woon and representative Jeon!
2023-07-10
Recently, FIFTY FIFTY filed an exclusive contract false disposition lawsuit against their management company ATTRAKT citing settlement issues. However, Korean media today suggested that the lawsuit they filed was actually meaningless. This is because Interpark, who signed a prepaid contract with StarCrew, stated that the investment contract was not FIFTY FIFTY's investment funds, hence there was no obligation to pay the members.
On April 5, following the first public hearing on the suspension of exclusive contract effect, Jeon Hong-jun, representative of ATTRAKT, told reporters that Interpark Entertainment and private company StarCrew have signed a prepayment circulation contract worth 9 billion Korean Won.
At that time, the defense argued that 6 billion out of 9 billion Korean Won was used for investing in FIFTY FIFTY records, record earnings were paid by StarCrew and said, "Under normal circumstances, a 9 billion won prepaid circulation contract would be signed between Interpark and ATTRAKT, StarCrew would shoulder the debt and it is also the structure paid to FIFTY FIFTY." However, Korean media pointed out that this is a complete misunderstanding of the investment contract payment process in the entertainment industry.
In an interview with Korean media, Interpark stated: "The reason for the pre-payment contract at that time was based on the success of Kang Sung-hoon under StarCrew and the experience and ability of CEO Jun Quan Hong. Although Interpark knew about StarCrew's idea of launching a girl group, the name FIFTY FIFTY wasn't even decided at that time. It was before The Givers' representative Ahn Seong-il joined."
The pre-paid music production contract is a common method used by small and medium-sized production companies to raise funds for their artists. This is done by getting an early investment for the production cost after signing contracts with record companies regarding the production and release of music. Most of these small and medium-sized companies frequently accept this kind of pre-payment investment to secure the cash for production costs. The pre-paid amount is used to cover the cost of producing the artist's records and the company's operating expenses. The pre-payment has no relationship with the artist's settlement. If the artist's sales unexpectedly rise and there's still a need to repay the pre-payment, the companies will have to find alternative ways to raise cash to pay the artist's settlement. A related person said, "Out of the 90 billion won investment, it was not for FIFTY FIFTY, but the investment was for other artists like Ha Sung-woon."
It is extremely rare for small and medium-sized companies to invest billions of Won into groups that have not yet made their debut. It was also revealed by certain insiders that ATTRAKT had already invested over 5 billion Won in FIFTY FIFTY before their debut. A certain insider pointed out, "The CEO thought it would be easier to attract investments if the company had fewer debts after FIFTY FIFTY's success, hence paid out of their own pockets. However, the members pointed out in the lawsuit that it's unreasonable not to receive a settlement due to advance investment."
Interpark also pointed out: "Starting from the release date, both domestic and overseas will provide accounting data to the planning company in a cycle of 3 months and 4 months respectively. For the record and music source income, members have received zero South Korean Won from December of last year until April of this year. Although 'Cupid' released in February this year has attracted attention overseas, it is difficult to get a settlement immediately as it is irrelevant to the advance payment."
Editor: The FIFTY FIFTY incident is getting more and more exposed! 😳
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