(Seoul, 13th) The shareholder agreement and put option dispute between former ADOR CEO Min Hee-jin and HYBE has reached a significant milestone. On the 12th, the Seoul Central District Court dismissed HYBE’s request to terminate the shareholder agreement and ruled that Min Hee-jin’s exercise of her put option was lawful and valid. HYBE has been ordered to pay approximately KRW 25.5 billion, along with litigation costs.
At the heart of the case was whether the shareholder agreement remained valid. HYBE argued that it had terminated the agreement in July 2024, rendering Min’s put option void. Min countered that the termination was invalid and exercised her contractual right to sell her shares.
The court found that HYBE failed to provide sufficient evidence of “material breach” or a breakdown of trust by Min. Accordingly, the court upheld the validity of her put option exercise.
Under the agreement, Min was entitled to exercise the put option 3 years and 10 months after ADOR’s establishment. The share price formula was based on:
Average operating profit of the past two years × 13 multiplier × shareholding ratio
With an 18% stake in ADOR, the estimated payout was approximately KRW 26 billion.
Regarding allegations that Min explored independent operations or contacted investors, the court ruled that such actions alone did not constitute a material breach.
The court also recognized KakaoTalk chat records as admissible evidence and determined that Min’s public statements were within her right of rebuttal.
Concerning the similarity controversy between ILLIT and NewJeans, the court stated that reports and petitions represented opinions and did not amount to breach of fiduciary duty. HYBE’s reported market capitalization decline of KRW 800 billion was deemed a market reaction rather than legal misconduct.
While Min has secured a preliminary legal victory, it remains to be seen whether HYBE will file an appeal.
