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The ongoing legal dispute between EXO-CBX and SM Entertainment is expected to continue for some time.
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SM Entertainment has recently taken legal action against EXO-CBX, comprising members Chen, Baekhyun, and Xiumin.
![EXO-CBX Responds to Allegations of Unpaid Intellectual Property Fees to SM Entertainment 5 eee](https://i0.wp.com/theubj.com/uae/wp-content/uploads/2024/06/eee.jpeg?resize=925%2C520)
The lawsuit is related to a disagreement over contractual agreements concerning IP usage fees between SM and the group’s members.
In a countersuit, EXO-CBX has challenged SM on grounds of an unfair profits distribution.
EXO-CBX Sues SM Entertainment Over Contentious Profit Sharing Arrangement
Reportedly, EXO-CBX has yet to remit royalty payments to SM for the use of intellectual property, which includes music and other assets, for a period exceeding six months.
Originally, an agreement was in place that required EXO-CBX to pay SM 10% of their sales profits on a quarterly basis, a sum inclusive of the IP usage fees. However, during a press event, EXO-CBX proposed a distinct arrangement for payment for the use of SM’s IP, a negotiation to which SM did not respond.
![EXO-CBX Responds to Allegations of Unpaid Intellectual Property Fees to SM Entertainment 6 group](https://i0.wp.com/theubj.com/uae/wp-content/uploads/2024/06/group-1-1.jpg?resize=925%2C707)
At present, EXO-CBX is still required to pay SM for IP usage, a matter that adds tension to the ongoing legal proceedings. Without resolution, they may be restricted from utilizing the group name and other related IP created by SM.
Netizens have expressed confusion over how EXO-CBX has been utilizing SM’s IP without fulfilling contractual payment obligations.
![EXO-CBX Responds to Allegations of Unpaid Intellectual Property Fees to SM Entertainment 7 kk](https://i0.wp.com/theubj.com/uae/wp-content/uploads/2024/06/kk.jpg?resize=925%2C778)
- “The magnitude of this case seems to be escalating.”
- “Aren’t the IP rights owned by SM? So, essentially, they are illegally using another company’s concrete intellectual property.”
- “SM has shown considerable leniency thus far but they need to take stringent measures now.”
- “They intend to compensate for IP usage since the sales percentage seems too hefty, and they haven’t been paying it anyway.”
- “If they’re unwilling to comply with the payment, they should disassociate from EXO.”
![EXO-CBX Responds to Allegations of Unpaid Intellectual Property Fees to SM Entertainment 8 kk2](https://i0.wp.com/theubj.com/uae/wp-content/uploads/2024/06/kk2.jpg?resize=925%2C562)
- “It’s surprising they weren’t aware?”
- “EXO-CBX has performed using EXO’s songs despite not settling IP fees?”
- “Why did they renew contracts if they had no plans to abide by them?”
- “SM might have to take severe legal recourse given that the misconduct involves touring without settling IP payments.”
Subsequently, EXO-CBX made an official statement concerning the IP fees issue.
We signed an agreement allowing us IP usage last June without stipulated fees. SM didn’t request payment for IP usage, hence it is baseless to claim non-payment. At the press conference, we took the initiative to propose a settlement for IP usage fees, but SM has remained silent. The insinuation of us not paying the IP fee through media play, without being approached by SM, is disappointing.
— INB100
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FAQs
What are intellectual property (IP) fees?
Intellectual property fees are charges paid for the use of IP, including things like music, branding, and other creative assets. They are often agreed upon through contracts and are necessary to compensate the creators or owners of the IP.
What is the conflict between EXO-CBX and SM Entertainment about?
The conflict revolves around a dispute over unpaid IP fees by EXO-CBX to SM Entertainment. While EXO-CBX claims there was no stated amount for the fees in their contract, SM alleges the group has been using the IP without fulfilling payment obligations.
What could happen if EXO-CBX doesn’t resolve the IP fee issue?
Failure to resolve the IP fee issue could result in EXO-CBX facing legal consequences and being unable to use their group name or other assets associated with SM Entertainment’s IP.
Has SM Entertainment responded to EXO-CBX’s proposal regarding the IP fees?
As per the EXO-CBX statement, SM Entertainment has not responded to their proposal made during a press conference concerning the settlement of IP usage fees.
Could this legal issue affect EXO-CBX’s ability to perform?
Yes, if the situation is not amicably resolved, it could potentially impact EXO-CBX’s ability to perform, particularly if the performances involve the use of IP owned by SM Entertainment.