NewJeans faces uphill battle in legal fight with potential penalties of up to $440 million
Girl group NewJeans members leave the Seoul Central District Court in Seocho District, March 7, after attending a hearing on an injunction filed by their agency to preserve management rights and prohibit individual advertisement contracts. Yonhap
Prospects for NewJeans returning to the K-pop scene remain uncertain as the legal dispute between the group and its agency, Ador, intensifies.
Last month, a court sided with Ador in granting an injunction to prevent the five members of NewJeans from pursuing independent activities or signing advertisement deals without the agency’s involvement.
Although a hearing was held on Wednesday in response to the members’ objection, the group maintained their stance that they cannot continue working with Ador.
'Low chance of NewJeans winning'
The court’s approval of the injunction has placed the NewJeans members in a difficult position. On March 21, the court accepted all of Ador’s requests to preserve its management rights over members Minji, Hanni, Danielle, Haerin and Hyein, and to prohibit them from entering separate advertising contracts.
The ruling stated that the previously submitted materials did not support the group’s claims that Ador had violated its contractual obligations or that the relationship of trust had broken down.
Legal experts believe this decision is unlikely to be overturned in a full trial. Attorney Ko Sang-rok said, “Although an injunction is technically a provisional measure, it’s based on comprehensive exchanges of evidence and arguments from both sides, so it will inevitably influence the first-instance ruling.”
Attorney Sun Jong-moon of Kwangya law firm echoed the sentiment, saying, “The chance of the main trial ruling differing from the injunction is very slim.”
After asserting their contract termination and continuing solo activities late last year, the members removed all traces of their tentative new group name “NJZ” following the court’s decision.
On April 5, the social media account under that name was deleted, and the group began communicating with fans under the handle “mhdhh,” a combination of their respective initials of their English names.
Unless new, compelling evidence emerges, experts believe Ador is likely to prevail in the main lawsuit as well. If NewJeans does not return to the agency despite a court ruling in Ador’s favor, the members could face astronomical penalties.
The key issue lies in the timing of the contract termination. Damages are typically calculated by multiplying the average monthly revenue over the two years preceding the termination by the number of months remaining on the contract.
If the termination is based on the group’s last performance under the NewJeans name at the end of 2023, the penalty could range from 400 billion to 600 billion won ($290 million to $440 million).
If calculated after a three-year legal battle, the amount could be significantly lower — in the hundreds of billions of won.
K-pop girl band NewJeans / Courtesy of Ador
Three-year trial timeline another obstacle
Although it’s possible that a final Supreme Court ruling could overturn earlier decisions, most in the industry agree that a prolonged legal fight would be detrimental to NewJeans. Delays could damage their image and force them to miss the critical “golden time” for a K-pop group’s growth.
“The injunction matters more than the main lawsuit because it immediately impacts the group’s ability to promote,” said a K-pop agency insider. “Since the court has sided with Ador, unless their objection is upheld, the members may be barred from activities for nearly a year — or up to three years if the case reaches the Supreme Court. That would seriously shake their fanbase.”
On Apr. 7, a truck protest took place outside the headquarters of HYBE, Ador’s parent company, in Yongsan, Seoul, calling for NewJeans to return to the agency.
Reports also surfaced suggesting that some members' parents opposed terminating the contract. In response, all five members' parents released a joint statement saying, “Each of us respects and supports our child’s decision. As parents, we cannot send our daughters back to Ador.”
The members have maintained on social media that “this lawsuit is about our values and human rights,” vowing to continue the legal battle.
However, public interest and support appear to be waning. Within the industry, there is growing support for a negotiated settlement.
One entertainment agency CEO said, “At this point, no matter the outcome, both sides will suffer losses, and being caught in a legal battle is especially damaging for NewJeans, whose image is everything. A compromise, with both sides making concessions, would be the best path forward.”
This article from the Hankook Ilbo, the sister publication of The Korea Times, is translated by a generative AI system and edited by The Korea Times.