Artist versus agency: Who should have trademark rights?

Industry

Published: 11 May. 2022, 13:17 Updated: 11 May. 2022, 15:06

Artist versus agency: Who should have trademark rights?

Girl group 2NE1 performs at the Coachella Music and Arts Festival at the Empire Polo Club on April 16 in California. [AP/YONHAP]

Members of former K-pop girl group 2NE1 took to the stage at the Coachella music festival in California on April 16, six years after they parted ways. The dreamed-of reunion was a surprise to everyone including the group’s fans, and rightly so.

Having debuted in 2009 under YG Entertainment, the girl group saw massive success with their smash hits including "Fire" (2009), "Ugly" (2011) and "Come Back Home" (2014). Following the abrupt breakup in November 2016, the four members of 2NE1 left YG Entertainment to sign with different agencies.

But since the 2NE1 name remains trademarked by YG Entertainment, the members needed the agency's agreement to run promotion campaigns or make any profit under the name — one of the reasons why the group kept a relatively low profile before taking the stage, trying to avoid any trademark issues.

"We don't really have anything to say on that matter," said a YG spokesperson. "We have no plan to take any legal action against them."

H.O.T. held a concert in 2018, the first in 17 years since the band's disbandment in 2001, but could not use their name because of a trademark rights issue. [SALT ENTERTAINMENT]

This isn't the first time that trademark rights became an issue in the K-pop scene.

H.O.T., considered to be a first-generation K-pop boy band, debuted in 1996 under SM Entertainment and disbanded in 2001. The band reunited in 2018 on an MBC TV show and held their first concert in 17 years that year. During the concert, however, they had to call themselves “High-five of Teenage” instead of H.O.T. because the owner of the H.O.T. trademark demanded a royalty fee if they used the name.

Highlight, which used to be known as Beast, rebranded itself in 2017 after the members’ contracts ended with their original agency Cube Entertainment.

It is both legal and not at all unusual for a K-pop group’s name to be trademarked by the entertainment agency. Normally, the agency is the investor, organizer and manager of its groups. It is the one that risks losing money, which makes it entitled to the profits and rights that come with a group's success.

SM Entertainment, which holds 1,862 trademark rights, is one example.

However, questions are being raised over whether this system of letting agencies own trademark rights is fair.

Some say the K-pop industry is different from the manufacturing sector, and therefore needs different rules. No one can argue with a manufacturing company owning the trademark rights for its products and brands. However, a K-pop group can't be defined as a mere product as the group members themselves put a tremendous amount of effort into their careers.

In several recent court cases, the court ruled in favor of the artists.

Boy band Shinhwa, one of K-pop's longest-standing bands that debuted in 1998, could not use the name “Shinhwa” in two of its albums until the band finally won a court case in 2015. After a four-year legal battle, Shinhwa became the first K-pop group to own the trademark rights to its own name.

Girl group T-Ara also won a legal dispute over trademark rights against its former agency MBK Entertainment. MBK Entertainment applied for the trademark rights after the contract with T-Ara members expired in 2017, but the Korean Intellectual Property Office declined the agency's application in 2018.

H.O.T.'s trademark controversy in 2018 was triggered by former SM CEO Kim Kyung-wook. Kim personally owns the group's trademark, and demanded a royalty fee for using the H.O.T name. The Supreme Court found Kim’s claim on the H.O.T. trademark right invalid in 2020, but the dispute is still ongoing as Kim took the case to the civil court.

“I agreed to the use of the H.O.T. name for the MBC variety show,” said Kim, “But the concert afterward became a problem because it was for commercial purposes.”

Kim explained that what he is fighting against is the concert organizer, not the artists. In May 2021, the Seoul Central District Court ruled in favor of the H.O.T. concert organizer, yet Kim made an appeal to the higher court.

A number of issues remain unsolved.

In 2018, the Ministry of Culture, Sports and Tourism advised the agencies to hand trademark rights to the artists when contracts expire, but also added that the agencies are entitled to demand a rightful reward for their investments and efforts in coming up with the trademarks.

Therefore, the controversy boils down to one question: Who made a bigger contribution to the success, the artist or the agency?

“It is true that Korean idol groups are the result of an entertainment agency’s long-term investment, but that does not mean that the agency should have 100 percent ownership of the group's brand,” said pop culture critic Ha Jae-keun.

Ha suggested that “the most ideal solution would be the agency and the idol artists sharing the trademark ownership based on their agreements over each party’s degree of contribution and the amount of profit generated,” though Ha admitted that “it is difficult to set an objective standard.”

BY BAE JUNG-WON [shin.hanee@joongang.co.kr]