Hybe To Proceed With Appeal And Other Legal Actions After Losing Min Heejin Put Option Lawsuit

Min Heejin Wins First Trial in Put Option Lawsuit Worth Approximately 26 Billion Won
"Sought Ways to Separate ADOR, But Not a Material Breach"

Hybe has announced that it will immediately appeal the court ruling in the lawsuit with former ADOR CEO Min Heejin (currently CEO of OK Records) over the termination of the shareholders' agreement and the exercise of a put option, in which it lost the case.

Min Heejin, former CEO of ADOR, appeared as a witness on the 11th at the Seoul Central District Court in Seocho-gu in a lawsuit against HYBE seeking payment for the share purchase and confirmation of the termination of the shareholders' agreement. Yonhap News

On the afternoon of the 12th, Hybe stated, "We regret that our arguments were not sufficiently accepted. After reviewing the written judgment, we plan to proceed with subsequent legal procedures, including an appeal."

Earlier that morning, the 31st Civil Division of the Seoul Central District Court (Presiding Judge Nam Insoo) ruled in favor of the plaintiff in the lawsuit filed by former CEO Min against Hybe for payment of stock purchase price. The court dismissed Hybe's lawsuit seeking confirmation of termination of the shareholders' agreement against Min.

The court ordered, "Hybe shall pay former CEO Min approximately 25.5 billion won as put option proceeds." It also ordered Hybe to pay approximately 1.7 billion won to former Vice CEO Shin, who was categorized as a close associate of Min and filed the lawsuit together, and approximately 1.4 billion won to former Director Kim, respectively. Former CEO Min did not attend the trial that day.

The court acknowledged that former CEO Min had sought ways to separate ADOR from Hybe. However, it determined that this could not be regarded as a material breach to the extent of undermining the essence of the shareholders' agreement. It also stated that there was insufficient evidence to conclusively support Hybe's allegation that she had attempted to "poach NewJeans."

The court further held that former CEO Min's allegation that ILLIT plagiarized NewJeans did not constitute a breach of contract. The court stated, "It is merely a value judgment or expression of opinion, and therefore cannot be regarded as dissemination of false information." Regarding the allegation that Hybe had engaged in forced album shipments, the court stated, "It appears that there was in fact a recommendation from Hybe for such forced shipments, and there is an aspect in which raising the issue contributed to establishing order in album distribution," and ruled that it was a legitimate business judgment.

The court added, "The grounds for termination asserted by Hybe are abstract or minor ancillary obligations," and "It is difficult to regard them as serious compared to the damage that former CEO Min would suffer, such as the loss of her put option, as a result of terminating the contract."

This legal dispute began in April 2024, when Hybe initiated an audit based on what it claimed was former CEO Min's attempt to seize management control. Hybe accused her of breach of trust, alleging that she met with external investors to explore ways to separate ADOR from Hybe. In response, former CEO Min countered that "Hybe is attempting retaliatory dismissal because I raised the issue that Hybe's group 'ILLIT' copied ADOR's 'NewJeans.'"

In November of that year, former CEO Min resigned from her position as an inside director of ADOR and notified the company that she would exercise her contractual right to sell her shares back to Hybe at a set price. Hybe has refused payment, arguing that the attempt to seize management control constituted a breach of contract and therefore the contract itself had been terminated. However, as a result of the ruling on the 12th, Hybe is now in a position where it must pay approximately 26 billion won.

Meanwhile, the same division of the court is also hearing a damages lawsuit filed by ADOR against former CEO Min, Danielle, and others. The amount claimed by ADOR, citing responsibility for the departure of NewJeans and delays in their return, is approximately 43.1 billion won, including damages.

This content was produced with the assistance of AI translation services.