Attorney Noh Jong-eon | Ilgan Sports 「Noh Jong-eon Entertainment Law Court」 Column

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The Clash Between Chaebol-Style Management Culture and the Entertainment Industry

Attorney Noh Jong-eon analyzes governance issues in the K-pop industry in this column. The conflict between HYBE and former ADOR CEO Min Hee-jin is not simply a one-off legal battle, but an inevitable problem that can arise when Korea’s unique “chaebol-style management culture” meets the entertainment industry. Large agencies centralize back-office functions such as platforms, distribution networks, accounting, and legal affairs, while their subsidiary labels focus on content production. Although this structure is highly efficient, the temptation to transplant an “already successful formula” to other labels can undermine independence between labels.

The Clash Between the 'Logic of Management' and the 'Logic of Creation'

According to Attorney Noh Jong-eon’s column, there is a structural risk of conflict between the professional manager’s “logic of management,” which emphasizes systems and numbers, and the creator’s “logic of creation,” which prioritizes the artist’s uniqueness and the emotions of fandom. From the perspective of a parent company investing massive capital, reducing risk is only natural, but if this infringes on the independence of creation, the fundamental value of the K-pop industry is undermined.

How Are the Global Standards of the U.S. and Europe Different?

Attorney Noh Jong-eon compares the legal systems of the United States and Europe, where large-label systems have been built for decades. U.S. commercial law and case law define the relationship between labels and artists as a strict “Fiduciary Duty,” so if a parent company damages the label’s value for its own benefit, it constitutes a breach of fiduciary duty. California labor law’s “7-Year Rule” limits employment contracts to a maximum of seven years, ensuring creators have an equal opportunity to renegotiate. Delaware corporate law imposes strict fiduciary duties to minority shareholders even when the parent company owns an absolute majority stake, and abuse of control is harshly punished as “Shareholder Oppression.”

For K-pop to Endure as a Global Industry

Attorney Noh Jong-eon concludes the column as follows. For K-pop to truly endure as a global industry, innovation in the legal and institutional framework is necessary. A “Key-man Clause” that can protect core creators from unfair personnel actions by the parent company, as well as an independent oversight system that breaks the structure in which parent-company executives monopolize the board, must be established. The reason K-pop is loved by people around the world is not because it is a standardized mass-produced product trapped in a uniform system, but because of the unique originality and human passion that emerge within it.

“Noh Jong-eon Entertainment Law Court” is published regularly in Ilgan Sports. Attorney Noh Jong-eon of Jonjae Law Firm explains legal issues in the entertainment industry based on firsthand experience.