The end of KARA?

Reports of KARA splitting from their agency, DSP Media Entertainment, has sent shockwaves throughout the music industry. The members of KARA, excluding leader Gyuri, reasoned that they had lost their confidence in their relationship with DSP Media Entertainment, and that it could never be regained again.

Landmark, KARA’s lawyers, reported on January 19th:

“Despite KARA receiving much love from their activities in both Korea and Japan, the members have experienced inexplicable pain that brought them to this decision. They’ve held it in for a long time, but in order to protect their rights and their future, the members have decided to part ways from their company.

KARA has tried their absolute best in compromising with their company prior to their decision, but their agency used their power in forcing the members to fulfill schedules that they did not want, and continuously added activities on top of a loaded schedule without prior consent or discussion. The psychological damages that the members were forced to endure cannot be explained in words, and their efforts have gone to waste. Their misery is severe, and they can no longer remain under such a company, which is why they decided to declare their withdrawal.

Trust is the most important aspect of a relationship between an agency and its artist, but the agency has been using KARA as a way to make money. A variety of issues that have not been stated are still present. The agency has decided the majority of the girls’ celebrity activities without any sort of discussion or meeting, and has rejected requests asking for explanations or for proper documents. Their relationship has been destroyed to the point that it could never be restored again.“

Representatives of DSP Media commented, “This is ridiculous, we are not sure what went wrong. We have yet to understand the situation. We’ll be releasing an official statement soon.”

However, because Park Gyuri is not joining the members’ lawsuit, it’s expected to have an impact on KARA’s future activities. KARA is currently filming for their Japanese drama, “URAKARA,” and has been juggling activities both in Korea and Japan. With the group being split into 4:1, many are expecting a variety of different issues to stem from this lawsuit.

Source + Photos: Star Today, Star News

Leader Park Gyuri gave her thoughts on the situation.

After KARA’s Seungyeon, Nicole, Hara, and Jiyoung declared that they were filing a lawsuit to terminate their exclusive contracts with DSP Media, leader Gyuri revealed her thoughts on the situation through Star News.

On January 19th, she stated, “I heard only just now that my dongsaengs were terminating their contracts with our agency. I am not sure of the situation right now, I have to call the other members and our agency.”

She continued, “I saw the articles just now as well. I will find out. I’ve been alone since last night because my radio program ended late, but all I want to do is be with the KARA members right now. That is the proper path. I’ll be talking with them after I understand precisely what is going on.”
Source: Star News via Nate

DSP Media files to trademark KARA’s name

With the industry still reeling from the news that KARA’s Seungyeon, Nicole, Hara, and Jiyoung were filing to terminate their exclusive contracts with their agency, DSP Media, it was hit with yet another shocking piece of news. It was reported that DSP Media has applied for trademark rights over the ‘KARA’ name – many had already believed that the ‘KARA’ name was trademarked by this point, considering the strength of the group’s success.

According to information revealed by a patent browser on January 19th, DSP Media requested to trademark 85 different clauses regarding KARA on December 7th, 2010. Because it is still only an application, DSP Media does not have rights over the name yet, but should it become finalized, the members will need special permission from DSP in order to continue under the name of ‘KARA’.

Such recent developments have raised speculations over whether DSP Media predicted KARA’s move and attempted to take advantage of the situation by submitting the application.

Trademark rights have always been a central issue whenever artists move onto different agencies, as the original agency is reluctant to allow those artists to promote under the same name once they leave.

The four girls were asked whether they would be open to compromising with DSP Media, in regards to their lawsuit against them. Hong Myungho of Landmark spoke through Star News and replied, “Before we reported the news to the public, we discussed with the parents of the four members and considered everyones’ opinions. Nobody has expressed a desire to continue moving forward with DSP Media. We will have to come to an agreement on various outstanding issues with DSP Media, in order to move on with the termination.”

When asked why Park Gyuri was excluded from their report, Hong replied, “We are working only for the four members, so we are not sure of Gyuri’s position. We’ve been in discussion with the members’ parents since two months ago. At the time, they attempted several times to reach a compromise with their agency, but because they could not reach one, they decided to terminate their contracts instead.”

TV Report uncovers details on the story behind KARA’s contracts

Further details regarding KARA’s decision to terminate their exclusive contracts with DSP Media have been revealed through TV Report, Park Gyuri’s mother, and representatives of DSP Media.

TV Report claimed that industry representatives were aware of the issues surrounding KARA and their agency since December 2010. Representatives of DSP Media and Park Gyuri allege that the reason for the four members’ terminations was “eventually because of money.”

According to another industry representative, KARA brought in a total of $18 million USD in income from their Japanese promotions, but as of December 2010, the group was only paid $3,000 USD per person.

The members were also only paid for album sales for August and September of 2010, excluding CF and event appearances. The girls are said to have been paid in a greater amount for their activities aside from album and digital sales, which are all going to be paid without problems. The reason the girls are paid less for their album sales is said to be because of specific clauses in DSP’s contract with their Japanese distribution company.

Income made from the girls’ Japanese albums are calculated three months after its initial release, and 85% of the profits go to the distribution company, leaving DSP with the remaining 15%. The representative mentioned that the numbers are similar for any Korean artist advancing into the Japanese market.

Especially with DSP Media’s CEO, Lee Hoyeon, currently hospitalized, all artists under the agency were ordered to be kept under tight control. Around this time, another entertainment agency approached KARA and offered them to join their agency. The agency went as far as to offer to pay the penalties the girls would have to deal with for breaching their contracts should they take the offer.

The representative was said to have met with one of the members’ mothers to present a contract with fairer terms and a promotion plan that would instantly earn KARA enough fame to rival that of SNSD’s popularity.

The representative first met with Gyuri’s mother, but discussions did not run smoothly. In an interview with TV Report, her mother stated, “I could not betray DSP, who worked their hardest in creating who KARA is now. I have no problems with the contracts, and I trust DSP.”

Representatives of DSP further added, “There were mothers that brought up problems, so we made sure to make all related documents as transparent as possible to them. We used accountants that they chose, but in the end, they could not trust even that.

Another representative also revealed that DSP Media met with KARA’s mothers on January 18th and almost reached a compromise to reform the income distribution regarding their Japanese albums. The next day, KARA’s lawyers from Landmark announced their contract terminations.

Is there a possibility for them to reach a compromise? The industry is already speculating them to be the ’second TVXQ‘ due to the complex underlying issues.

“There are definitely various problems with both parties, but the ultimate issue is the competition in trying to scout KARA, and money. The reality of these disputes with TVXQ and KARA is quite disappointing,” said one representative.

DSP Media has reasoned that they have no option left but to take legal action, predicting yet another legal battle in the industry.

DSP Media releases official statement, Goo Hara cancels contract termination

After the four members of KARA previously announced that they filed to terminate their contracts with DSP Media, representatives of the agency have finally released an official statement on January 19th.

It reads:
“DSP Media will be making an official statement regarding the contract terminations reported by Jung Nicole, Han Seungyeon, Kang Jiyoung, and Goo Hara of KARA. We received a one-sided declaration from their lawyers, Landmark, on January 18th, but Goo Hara has decided not to join the others in terminating her contract.

According to their claims, the 10-month hospitalization of CEO Lee Hoyeon caused the management to become inefficient in planning and promoting the group’s activities, but that is not the truth, as the CEO’s wife ran administration in place of the CEO. KARA’s explosive popularity with the Hallyu wave in Japan testifies to these efforts, further proving that the management did not mishandle their activities.

CEO Lee Hoyeon was not able to run the company himself beginning March of 2010, and KARA’s Japanese achievements were made five months later in August. DSP Media has done all they can in supporting and preparing KARA’s Japanese advancement.

Regarding the income distribution claims made by Nicole’s mother and their lawyers, the information they revealed was distorted and is a complete misunderstanding. Income was distributed in a manner that was most profitable to the KARA members, and unlike what they claimed, every employee was paid at the same time the moment profits were received.

They also claimed that DSP used its stature to force unwanted schedules and activities, but this is also a baseless claim. This is a claim that only defames the company employees who have worked their hardest to raise KARA as one of Korea’s top groups and leaders of the Hallyu wave.

And regarding speculations from another report about a competing agency attempting to persuade their parents and lawyers to terminate the girls’ contract with DSP, we ask that they stop such actions immediately. Should such requests be made repeatedly, we will make sure that they are met with legal consequences.

As the company that has poured their sweat and effort into creating who KARA is today, we hope that such issues are no longer exaggerated. Should there be issues between both parties, adjustments and reconciliation should be the appropriate step in continuing to promote themselves as a representative girl group of Korea.”

Regarding news of Hara staying with DSP Media, representatives continued, “Hara has decided not to comply with the terminations she submitted earlier today with the other members.” The possibility of further changes in the remaining three contracts is now at center stage.

As for their Japanese drama, “URAKARA” which is now facing an uncertain future, they stated, “They’ve already filmed four episodes before this so we have about three weeks of time left. We are looking forward to drawing a positive decision with the KARA members before then.”