At first glance, the \u201cglobal girl group\u201d KATSEYE appears as glittery and whole as the cat\u2019s eye gemstone it was named after. But all is not as it seems. Known for dynamic choreography and a Y2K aesthetic sharp enough to land a Fendi campaign, the group was recently dropped into a sea of online discourse when its only Black and European member, Manon, went on hiatus. The group\u2019s label, Hybe, cited health reasons, which has done nothing to deter the think pieces and rumors.<\/p>\n
But Manon going MIA is not the only opaque element of KATSEYE. What legal framework even governs this type of situation? It is neither a straightforward K-pop group nor a conventional American girl group. The group is the first act produced out of a joint venture between Hybe \u2014 the Korean music company behind BTS and Le Sserafim \u2014 and Geffen Records. Trained for a year in Los Angeles under the Korean idol methodology, making English pop songs and nominated for a Grammy \u2014 these international infrastructures all operate simultaneously with no obvious answer for which country\u2019s rules apply to which part of the relationship.<\/p>\n
To better understand this, I sat down with Daniel Schacht and Melanie Kim, both attorneys at Donahue Fitzgerald LLP in Oakland. Schacht is a 2008 graduate from the UC Berkeley School of Law and a current professor who spent a decade trying to make it as a musician before pivoting to law. He now runs the firm\u2019s music and entertainment practice, often working with independent artists as they navigate label contracts. Kim is a fifth-year associate specializing in employment law, defending employers in litigation and providing counseling to employers on California Employment Law. They\u2019re here to explain the hazy machinery that governs this collaboration \u2014 and that machinery turns out to be more complicated than K-pop\u2019s repressive reputation suggests.<\/p>\n
In the K-pop industries, companies recruit children \u2014 sometimes as young as 10 or 12 \u2014 sign them to exclusive contracts and invest years training them in singing, dance, facial expressions and image before they debut publicly. During that time, trainees are often classified as \u201cinterns\u201d or \u201cindependent contractors\u201d rather than employees, which limits their access to basic labour rights. Once they do debut, contracts cover not just their music but their personal conduct, travel, relationships and public image. In 2023, idol Chuu from the girl group Loona revealed she had earned less than minimum wage for more than four years of work despite a packed schedule of TV appearances and commercials, with her company taking a 70% cut of her earnings.<\/p>\n
But the K-pop system isn\u2019t alien. It\u2019s an intensified alternative to what the U.S. system has already done and has only partially moved away from. Dr Schacht notes that while the K-pop methodology is notoriously restrictive, the trainee system mirrors the American industry\u2019s past and present with \u201cclassic labels like Motown, where they groomed and developed artists (through) \u2019finishing schools\u2019 so they would walk properly.\u201d<\/p>\n
\u2014<\/p>\n
KIM: From the employment perspective, in California, there\u2019s two classifications of workers \u2014 employees and independent contractors. Single artists like Miley Cyrus who contract with record labels are independent contractors rather than employees. So all of the protections that California legislates for employees \u2014 like meal breaks or that an employer can\u2019t punish them for off-duty conduct \u2014 typically don\u2019t extend to independent contractors.<\/p>\n
In California especially, the record label lobby is very strong, so there\u2019s even less protection for musicians in some cases. Take Uber. They lobbied so hard that the court didn\u2019t find that Uber drivers were employees. They found that they were independent contractors.<\/p>\n
These companies are saying, \u201cYou\u2019re getting the worst of both worlds here. You don\u2019t have the employment law protections and you don\u2019t have the rights.\u201d<\/p>\n
JOU: What if they put a member on a break?<\/p>\n
SCHACHT: Labels never have an obligation to put music out. When I was doing music, there was a case where somebody got signed and everyone\u2019s excited: \u201cYay, a local musician got signed!\u201d<\/p>\n
Completely shelved. Never had her album released. She\u2019d have been better off releasing it herself. But it took many years for her to work on it, deliver it, sit there, twiddle her thumbs, and finally realize this is never coming out.<\/p>\n
What we always ask for are the rights to revert: \u201cListen, if you don\u2019t release this within a certain amount of time, then the rights will come back.\u201d The labels don\u2019t have a good argument not to agree to it, because what do you benefit from not releasing? Sometimes they say, \u201cYou have to send us a notice, and then we have another six months to try and release it.\u201d Fine.<\/p>\n
The other question comes about the costs, because often the labels say, \u201cIf we put $200,000 into this we need to see that money back,\u201d which is not an unreasonable position to take. Sometimes you can negotiate by saying, \u201cOkay, we\u2019ll take it off the royalties that come in.\u201d But in the K-pop situation, where labels claim to have spent millions on young artists, good luck trying to make that back. If they are claiming all these costs should be reimbursed, you have an artist with a huge deficit account that\u2019s realistically not going to see a dime, especially if it\u2019s subject to label accounting.<\/p>\n
JOU: I believe because they\u2019re basically in a boarding school to become a K-pop idol, the company factors in food, housing and clothes.<\/p>\n
SCHACHT: That echoes the older arguments of record labels here in the U.S., back when recording and manufacturing was much more expensive. They would say: \u201cLook, for every 10 artists we invest in, the one who makes it has to pay for the other nine.\u201d There\u2019s an economic reality to that in creative business, where most people don\u2019t succeed. But you can also see how that becomes an easy argument to have exploitative contracts.<\/p>\n
KIM: K-pop idols\u2019 standard now is for groups to sign into seven-year contracts. That came about in 2009 when TVXQ sued SM, and SM was standardly signing artists for 10-13 years. They called it slave contracts. They got it changed to seven.<\/p>\n
In California, any contract in which a person agrees to render personal service is limited to seven years since the 1930s. But the record label lobby had an exception written into that statute. It\u2019s in the California labor code section 2855, subsection B, for services related to the production of photo records \u2014 basically albums. In addition to the seven years, it will have a requirement that the artist release seven albums or 10 albums within the contract. At the time the seven-years run out, if the artist hasn\u2019t released seven albums, the music label can hold the artist to that album count. Basically, it\u2019s eviscerating the seven-year statute for artists.<\/p>\n
That has become an issue when record labels shelve artists and don\u2019t let them release albums. If they have a contract to release seven albums, but the label says no to albums, the contract extends longer and longer, leading to the problem of slave contracts all over again.<\/p>\n
I\u2019m not sure in the Korean context whether there\u2019s that music exception. I think seven-year contracts do end at the end of seven years. So that is a difference between California and Korean law.<\/p>\n
In the context of her hiatus, I wonder if it affects her term with the American record label company. At the end of the seven years, will they ask her to pay damages for breach of contract for not completing the same number of records as everyone else did?<\/p>\n
JOU: What happens when you breach a contract?<\/p>\n
SCHACHT: Under U.S. law, you\u2019re never going to get a court saying you must do something. A court will rarely say \u201cyou must show up to a photoshoot\u201d \u2014 that implicates the 13th Amendment and is disfavored. Courts don\u2019t want to force people to appear for those civil injunctions.<\/p>\n
So then the question is, what does the label do? Do they sue for damages, or do they just go without money? Anytime you can measure the amount of damages in money, the court will prefer that approach. The hard part is measuring how much it costs the label when the artist doesn\u2019t show up to a photoshoot. It\u2019s hard to quantify.<\/p>\n
So it\u2019s very hard to sue for damages for not showing up at a photoshoot. You could. But now you\u2019re going to air your dirty laundry in public, and you might not have a remedy. It\u2019s a publicity issue; it doesn\u2019t look good to be suing your own artist.<\/p>\n
KIM: I think the only thing I can add to that is that there were some statutory reforms on K-pop contracts. The label has to consider the artist\u2019s mental health while scheduling photoshoots (shoots and recording), and the artist can\u2019t refuse schedules for unreasonable reasons.<\/p>\n
That was a reaction to K-pop celebrities\u2019 mental health being in the headlines a lot. Like suicides, fan concern and national news. Right now, I don\u2019t think that exists in California \u2014 that the employer has to take into consideration their mental health. Maybe if it becomes more like a matter of public concern in the US, there will be more legislators trying to govern what can be in the contract.<\/p>\n
SCHACHT: The US copyright act tends to be \u2014 much like the U.S. \u2014 very focused on money and individual rights. If you look at Europe, they tend to be more focused on moral rights, and the rights of an author are innate. So there are more rights that are inalienable. There might be different limitations on what you can sign or what you can do with someone\u2019s name that aren\u2019t as applicable in the U.S.<\/p>\n
\u2014<\/p>\n
The picture that emerges isn\u2019t flattering, and not only for K-pop. The contractor classification that strips artists of workplace protections exists in California, too. The rule designed to protect performers has a carve-out that effectively nullifies it for musicians.<\/p>\n
And yet there may be forces pushing back that aren\u2019t strictly legal.<\/p>\n
\u2014<\/p>\n
JOU: If you\u2019re advising a relatively young adult who\u2019s signing to a girl group like this, how would you advise them?<\/p>\n
SCHACHT: My own track record with younger artists is helping them get more artist-friendly deals. But I think ultimately it\u2019s about artist choice, right? If all they care about is becoming famous, this might be the best vehicle for them. Now you want to acknowledge that for every KATSEYE, there\u2019s how many hundred folks that don\u2019t make it.<\/p>\n
You have to ask what\u2019s important. In the end, our job as lawyers is not to make the decision for an artist, but to help them make the best, informed decision for themselves.<\/p>\n
JOU: Because there\u2019s always the fear that this will be the only opportunity and then there won\u2019t be any others?<\/p>\n
SCHACHT: I think for some people. If somebody has a clear-eyed vision of what\u2019s going on they may say, \u201cYep, I understand that this is going to lock me in for a long time.\u201d Now, as an attorney, you want to be able to negotiate and get a better deal. And sometimes there are things you can fix. But at the end of the day, you\u2019re not going to get a super artist-friendly deal on some of these instances, particularly where the client has no track record.<\/p>\n
We represented a local artist, mxmtoon. She had a following before she signed with any label. That\u2019s a track record \u2014 very different from some of these folks who have a dream, but not much else yet. Maybe they have great talent, but they don\u2019t have fans or a track record, and so then they\u2019re in the situation, wondering, \u201cAm I just one of several thousand people that if they pass me over, or if I make too many demands, they\u2019ll just grab somebody else who doesn\u2019t read the contract?\u201d<\/p>\n
JOU: So it\u2019s similar to acting and publishing, where social media could give you a little bit of leverage?<\/p>\n
SCHACHT: I mean, it\u2019s hard. Take that example of a woman whose album was shelved. In retrospect, she would have been better putting out that album herself, working on a second one, and releasing a third without a big marketing budget, all before the label even decided the first album was going to be shelved. But that\u2019s in retrospect. Those things are hard to foretell, and it\u2019s an industry where you need all the stars to align to become successful.<\/p>\n
Was that too pessimistic?<\/p>\n
KIM: No, I think that\u2019s the reality. There\u2019s an imbalance of power. Especially in an industry where a few big companies dominate.<\/p>\n
SCHACHT: If you have too few players in the market, you\u2019re going to have worse contracts. This consolidation of labels does not help artists. If we\u2019re talking about what the government could do, it is to make sure that there\u2019s more competition. So somebody would be able to have different offers on the table, so that labels have a real bidding war rather than a sort of conglomerate that can dictate market terms.<\/p>\n
I think there is a general shift toward more artist-friendly deals. I think fans like it. \u201cAmerican Idol\u201d got backlash about their exploitative contracts.<\/p>\n
Artist independence is a value here that\u2019s thankfully taken hold. It\u2019s a cliche of exploitative labels.<\/p>\n
JOU: But the K-pop system is insanely profitable. If a record label says, \u201cWe really want to do this here,\u201d would public backlash and current laws stop it from happening?<\/p>\n
SCHACHT: That\u2019s a good question, because American labels love to make money.<\/p>\n
KIM: They have a strong lobby. And the power to shape laws.<\/p>\n
SCHACHT: Think about somebody like Taylor Swift. She pushed hard on Apple, not just on behalf of herself, but on behalf of all artists to get paid fairly when they were trying not to pay artists for the complimentary subscriptions. I wonder if here you might also get some pushback from artists who themselves are opposed to these kinds of restrictive deals and restrictive business arrangements.<\/p>\n
\u2014<\/p>\n
The glitter of a group such as KATSEYE is held together by a legal machinery that is frequently one-sided. California has a reputation as the \u201cgood guy\u201d in the story: the jurisdiction with protections strong enough to check what Korea\u2019s system permits. But there are holes, and corporate lobbying has used those holes to carve out necessary protections.<\/p>\n
The protection has shifted from the courtroom to the comment section. KATSEYE fan \u201cgossip\u201d is actually the same mechanism that holds labels accountable for their unfair treatment. But fan accountability is a fragile defense.<\/p>\n
It\u2019s not just that artists should \u201csay no\u201d to exploitative deals, although that is important. A structural shift is also necessary. Whether through the revival of antitrust competition or the closing of California\u2019s contractor loopholes, the burden of protection belongs to the law. Until then, the best bet for the next generation of creators is a radical \u201cclear-eyedness\u201d \u2014 a recognition that in the world of pop, your talent is ultimately a product, and the contract a gorgeous golden cage.<\/p>\n","protected":false},"excerpt":{"rendered":"At first glance, the \u201cglobal girl group\u201d KATSEYE appears as glittery and whole as the cat\u2019s eye gemstone…\n","protected":false},"author":2,"featured_media":10017,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[7626,1598,1168,7627,7616,7618,7624,7615,7622,7614,6069,195,7613,31,7623,7628,4144,7619,7629,7617,7632,7625,4988,7630,7621,1748,7620,7631],"class_list":["post-10016","post","type-post","status-publish","format-standard","has-post-thumbnail","category-korea","tag-berkeley-law","tag-bts","tag-california","tag-chuu","tag-copyright","tag-daniel-schacht","tag-donahue-fitzgerald-llp","tag-employment","tag-fendi","tag-geffen","tag-hybe","tag-k-pop","tag-katseye","tag-korea","tag-le-serraffim","tag-loona","tag-los-angeles","tag-melanie-kim","tag-miley-cyrus","tag-music-law","tag-mxmtoon","tag-oakland","tag-pop-music","tag-record-label-lobbying","tag-sm","tag-taylor-swift","tag-tvxq","tag-uber"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts\/10016","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/comments?post=10016"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts\/10016\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/media\/10017"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/media?parent=10016"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/categories?post=10016"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/tags?post=10016"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}