Singer Lim Chang-jung has denied allegations of unpaid concert guarantees, while the concert planning company has responded with a rebuttal.
On the 19th, the concert planning company Jay-Z Star released an official statement saying, “Since we first signed a business agreement with Lim Chang-jung in 2020, we have cooperated based on trust, but we have suffered damages due to contract violations. Lim Chang-jung is well aware of this fact. However, when the issue of the guarantee dispute was reported in the media, we decided to consider legal action after seeing his response of ‘not true’,” they stated.
Previously, on the 14th, Lim Chang-jung's side stated regarding the allegations of unpaid concert guarantees, “The claims of Company A (Jay-Z Star) are not true,” and “We have actively cooperated with Company A (Jay-Z Star) regarding all legal demands prior to the provisional registration and have faithfully fulfilled our repayment obligations.”
In this regard, Jay-Z Star claimed, “Even after the controversy over ‘stock price manipulation’, we actively helped Lim Chang-jung restore his image. We also provided free support in response to the controversy over the acting academy and the closure of the hair salon. However, Lim Chang-jung stopped contacting us from the end of 2024.”
They continued, “At the point when the remaining performances were canceled due to the ‘stock price manipulation’ controversy, we took out loans to return the deposit to maintain trust with investors and partners. We have made efforts to resolve the situation while bearing the financial burden, but communication with Lim Chang-jung has been cut off, making normal negotiations difficult.”
Jay-Z Star emphasized, “The profits we have identified since Lim Chang-jung's promise of repayment amount to approximately 2.1 billion won in copyright ownership, about 1.4 billion won in concert guarantees, totaling about 3.5 billion won. Despite being in a position to repay sufficiently, Lim Chang-jung has not fulfilled his obligations, citing provisional registration as a reason. Instead, he has concealed his situation, causing significant damage to our company, and even distorted these facts in his recent statement. To prevent further unilateral damage, we have initiated legal procedures for debt fulfillment and will actively respond until we receive just compensation.”
Below is the full statement from Jay-Z Star
Hello, this is Jay-Z Star.
We are delivering our position regarding Lim Chang-jung.
Before we begin, we would like to clarify that Lim Chang-jung's current position may lead to misunderstandings that he has done his best to repay. However, we must state that the dispute with our company goes beyond a simple guarantee issue.
Since we first signed a business agreement with Lim Chang-jung in 2020, we have cooperated based on trust, but we have suffered damages due to contract violations. Nevertheless, we have worked with Lim Chang-jung for a long time, enduring losses to prevent disputes like the current one.
Lim Chang-jung is well aware of this fact. However, when the issue of the guarantee dispute was reported in the media, we decided to consider legal action after seeing his response of ‘not true’.
▶ Regarding the 2020-2021 nationwide tour concert
In March 2020, we signed a contract for a nationwide tour concert with Lim Chang-jung. Despite the difficulties in holding performances due to COVID-19, we pre-paid a guarantee of 1.48 billion won six times until November 2021 based on trust. However, in November 2021, Lim Chang-jung was confirmed to have COVID-19 after violating quarantine regulations.
As the company responsible for Lim Chang-jung's overall work, including performances and promotions, we decided to inevitably postpone the nationwide tour concert as a risk management measure. Although we could have claimed damages due to the artist's fault, we focused on managing the situation and absorbed all losses, including cancellation penalties and a one-year venue ban. Lim Chang-jung also expressed gratitude for our decision. At the same time, he verbally agreed to provide his concert rights for life.
The postponed nationwide tour concert was held in 2022 under the title ‘Multiverse’, and starting with the Jeonju performance on June 18, a total of 28 performances were successfully completed by December 31 in Busan. In particular, this concert attracted about four times more audience compared to the nationwide tour “IMCHANGJUNG” held in 2018-2019. Accordingly, we decided to hold the remaining 12 performances in 2023 and began preparations, but Lim Chang-jung expressed his desire to break the verbal agreement, stating that he wanted to hold the concert with new investors.
▶ Regarding the remake album
In 2022, we and Lim Chang-jung signed a project music performance contract ahead of the nationwide tour concert ‘Multiverse’. The main content was the release of Lim Chang-jung's remake album, which was promoted due to its rarity as he had rarely covered songs by other artists. The release of the remake album was also intended to show Lim Chang-jung's new side to the audience during the 2023 tour.
On April 6, 2023, the distribution contract was completed, and we spent 115 million won on production costs, including performance fees, arrangement agreements, and other expenses. We advanced approximately 75 million won in performance fees to Lim Chang-jung in two installments by April 20.
▶ Details of the damage settlement due to the ‘stock price manipulation’ controversy
Lim Chang-jung became embroiled in a stock price manipulation controversy that erupted on April 25, 2023, making normal activities difficult. Accordingly, we and Lim Chang-jung drafted a settlement agreement regarding damages related to the concert and remake album on May 13, 2023. The contents of the settlement are as follows.
1. Concert
- Concert guarantee: 720,000,000
- Venue fee: 77,800,000
- Loss from cancellation of local performances: 80,000,000
2. Project album
- Performance fee: 75,000,000
- Arrangement agreement: 7,500,000
- Song arrangement and production: 32,500,000
3. Promotion costs
- Media: 25,000,000 (Lim Chang-jung, Seo Ha-yan, and other affiliated artists)
4. Provisional registration fee
- Fee: 8,600,000
= Total amount: 1,026,400,000
= Including VAT: 1,129,040,000
As can be seen from the content, we set the damages only for actual costs such as guarantees, venue fees, and production costs for the album, considering Lim Chang-jung's situation at the time. The delayed interest or future expected profits claimed by Lim Chang-jung's side on the 14th were not included in the amount at that time.
▶ Regarding the provisional registration of the company-owned building
Additionally, Lim Chang-jung's side stated in their previous statement that they had transferred the company-owned building to our company for provisional registration. At that time, Lim Chang-jung was under pressure not only from our company's damages but also from various businesses and distributors, including F&B. Therefore, we proceeded with the provisional registration after reaching an agreement with Lim Chang-jung to secure the debt as collateral.
Lim Chang-jung explained during the provisional registration process that “if the building is sold, it will be enough to repay the damages.” Contrary to Lim Chang-jung's explanation, the building had a very high bank loan ratio, and even if the building were sold, it was not guaranteed that our company's damages would be secured.
Nevertheless, we approved this based on the trust relationship with Lim Chang-jung at the time. If we had intended to recover damages through the building, we would have already proceeded with an auction or taken active measures such as charging rent from Lim Chang-jung, who continues to use the building.
In fact, Lim Chang-jung deposited about 200 million won, a portion of the settlement amount related to damages, on November 16, 2023. Seeing this, we understood Lim Chang-jung's situation, which had lost a lot due to the ‘stock price manipulation’ controversy, and decided to help him return to the stage, even if it meant suffering losses.
However, no further repayments were made afterward, and communication with Lim Chang-jung remained difficult.
▶ Regarding Lim Chang-jung's failure to repay
On the 14th, Lim Chang-jung's side stated in their statement that they had made every effort to take maximum responsibility for the damages.
We actively helped Lim Chang-jung restore his image even after the ‘stock price manipulation’ controversy. We also provided free support in response to the controversy over the acting academy and the closure of the hair salon.
However, Lim Chang-jung stopped contacting us from the end of 2024. At the point when the remaining performances were canceled due to the ‘stock price manipulation’ controversy, we took out loans to return the deposit to maintain trust with investors and partners. We have made efforts to resolve the situation while bearing the financial burden, but communication with Lim Chang-jung has been cut off, making normal negotiations difficult.
Moreover, we heard directly from the concert planning company Mbox that Lim Chang-jung is hosting a concert with a large guarantee from them in the second half of last year. Additionally, Lim Chang-jung asked us to sell his copyright but sold it to another company without any consultation, generating hundreds of millions of won in profits, and concealed this fact from us. Thus, despite having sufficient funds to repay, Lim Chang-jung did not fulfill his obligations.
At that time, we tried to discuss solutions with CEO Seo Ha-yan, but communication was not smooth. Another person related to Lim Chang-jung lied when asked about the repayment plan, saying, “The copyright sale profits were used to pay off the 2 billion won distribution advance,” and when it came to the concert appearance deposit, he raised his voice, saying, “I have never received a concert guarantee. I don’t know anything about it.”
Lim Chang-jung expressed his intention to meet and discuss with us, but he did not show up at the promised location, and since then, we have not been able to contact him. I want to ask if Lim Chang-jung has truly made every effort to repay his debts.
It is true that Mbox and we have discussed repayment plans for several months until recently. During that process, we first expressed our opinion on legal delayed interest to Lim Chang-jung, who had betrayed our trust. In response, Mbox changed their words regarding realistic repayment plans and ultimately proposed a limited payment conditional on the release of the provisional registration. This was a condition that was difficult for us to accept, but we even accepted that. However, the last statement we heard from Mbox was that “repayment is difficult.”
▶ Conclusion and our response policy
The profits we have identified since Lim Chang-jung's promise of repayment amount to approximately 2.1 billion won in copyright ownership, about 1.4 billion won in concert guarantees, totaling about 3.5 billion won. Despite being in a position to repay sufficiently, Lim Chang-jung has not fulfilled his obligations, citing provisional registration as a reason. Instead, he has concealed his situation, causing significant damage to our company, and even distorted these facts in his recent statement.
To prevent further unilateral damage, we have initiated legal procedures for debt fulfillment and will actively respond until we receive just compensation.
Thank you.
[Lee Da-gyeom, Star Today Reporter]
