Kang Daniel's And LM's Legal Reps Present Their Arguments At Court Questioning For Contract Dispute

The court questioning for the legal conflict between Kang Daniel and LM Entertainment (hereafter LM) took place on April 24 at the Seoul Central District Court.

The conflict began when Kang Daniel filed a request for an injunction against the agency and the suspension of his exclusive contract on March 21.

Kang Daniel’s side states that LM signed a joint business contract that sells Kang Daniel’s exclusive contract rights to a third party (MMO Entertainment, hereafter MMO), breaching the terms of their contract. LM refuted the claims, stating that the contract was signed for the purpose of receiving an investment from MMO. LM claims that they never signed exclusive rights over to another party and holds all exclusive rights for management activities, with no participation from anyone else.

At the court questioning, Kang Daniel’s legal representative Yulchon LCC stated, “LM claims that they delegated part of the rights [to MMO], but according to the exclusive contract, this is no different from signing over the rights of the contract. Acting as a proxy means to execute actions on behalf of [the other party], making the proxy merely an assistant, and therefore, the rights were signed over to MMO.”

They added, “Gil Jong Hwa (LM’s CEO) signed over the rights of the exclusive contract to MMO and received a sum amounting to 10 times the 50 million won (approximately $43,500) given to Kang Daniel. [Gil Jong Hwa] is also leading the development of malicious media play. As trust was already broken, it is difficult to maintain the contractual relationship.”

LM refuted the argument from Kang Daniel’s side stating that he did not receive the down payment for his contract, saying, “We already gave him the down payment on February 14.”

LM also argued, “Seol Hye Seung, who was listed as Kang Daniel’s initial legal representative, also said she knew about the joint business contract with CJ (MMO’s parent company). She even presented better conditions for the contract. Because the business was carried out in this way, it does not make sense that Seol Hye Seung and other representatives did not know about this contract. Kang Daniel’s side already knew about the joint business contract with MMO.”

They continued, “The negotiation rights belong to MMO, but LM possesses the contracting rights. The act of negotiating is not a right in itself. It does not indicate that the exclusive rights of the contract were signed over [to MMO].” They added that there is no judicial precedent ruling that signing a joint business contract equates to signing over rights.

In response to LM’s claims that Kang Daniel implicitly agreed to the joint business contract, Yulchon LCC stated, “MMO was his agency at the time. The support they provided [for his activities] was unrelated to the rights being signed over. His intent was to sign an exclusive contract with LM to independently begin his solo activities, and the essence of this issue is that LM signed a contract with MMO without informing Kang Daniel.”

LM refuted Yulchon LCC’s claims saying, “It was something that was mentioned when we were building our plan of action to support his solo activities after the conclusion of his activities with Wanna One. We did not explain it line by line while going over a specific document, but Kang Daniel knew about the situation and that MMO would provide his dorm. He was considerably aware of it.”

Yulchon LCC responded, “Kang Daniel said that it was not something he could imagine by looking at the contract,” and added that it was a “great breach of trust.”

Other things mentioned at the court questioning were issues regarding Kang Daniel’s social media account and LM’s management abilities.

LM stated, “[Kang Daniel’s] social media account was made under the name of LM’s employees and managed by them. Naturally, it cannot be handed over to Kang Daniel.”

In regards to Kang Daniel pointing out flaws in LM’s management abilities, LM explained, “Yoon Ji Sung and Kang Daniel signed contracts together. Through LM’s management, Yoon Ji Sung has been promoting diligently from February to April. Therefore, it is not valid to claim that LM does not have management abilities.”

Later in the day, Kang Daniel relayed a message to fans through his legal representative. He said, “First, I thank all of my fans for showing me lots of attention and love. It’s sad that I wasn’t able to spend time [with fans] for such a long time, but I came all this way thinking that I want to take the right path, even if it takes a bit longer. I will make sure not to fall short of the expectations of my fans, who are trusting me until the end.”

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