(Original title: The resurrection of Cai Xukun’s contract termination turmoil, former boss reveals multiple evidence to recover compensation! Top-tier artists are enough to support a company)
Not long ago, the prospectuses of Lehua Entertainment and Fenghua Qiushi made the public aware of the powerful ability of top artists to attract money. In the face of huge interests, contract disputes between brokerage firms and artists are also increasing.
Recently, Cai Xukun’s former agency Shanghai Yihai Film and Television Culture Communication Co, Ltd (Yihai Culture) released a lot of evidence through Weibo, saying that it will pursue economic compensation for the early termination of Cai Xukun’s contract through legal means.
The termination of the contract is making waves again
The contract termination dispute between Cai Xukun and its former owner Yihai Culture can be traced back to 2015.
In 2015, Cai Xukun signed a contract with Haoyang Media (Hunan) Co., Ltd. to participate in the “Star Moving Asia” program. During the program recording process, due to the transfer of the program producer, Cai Xukun was told to re-sign the contract, otherwise he would not be able to continue participating in the program. In order to continue to complete the recording of the program, on November 17, 2015, Cai Xukun signed a brokerage contract with Yihai Culture.
After the contract was signed, the two parties signed a supplementary contract in June 2016 to adjust Cai Xukun’s compensation for contract termination. For example, the compensation for Cai Xukun’s unilateral contract termination was changed from 8 million yuan to 80 million yuan. , and the compensation for early termination of the contract was changed from 3 million yuan per year. Revised to 30 million yuan per year.
In 2017, Cai Xukun proposed to Yihai Culture to terminate the contract and filed a lawsuit. The main reason is that Yihai Culture unilaterally increased the fixed compensation contract and compensation at will, and also required Cai Xukun to bear the cost of his performing arts activities and take away a large proportion of his performing arts activities.
In addition, Cai Xukun believes that Yihai Culture has not fulfilled the performing arts brokerage obligations specified in the contract, has failed to fulfill the management and operation obligations of artist brokerage affairs, and has failed to make a complete and reasonable plan for its career in the performing arts, so she was unable to improve her career in the performing arts Professional and stable support.
However, Yihai culture tells another story. He said that on November 12, 2015, he signed a brokerage contract and supplementary agreement with Cai Xukun, agreeing that he would be the sole exclusive agent of Cai Xukun, and the contract period would expire on April 17, 2023.
After signing the contract, the company arranged for Cai Xukun to participate in the large-scale developmental talent show “Star Asia”, and arranged to go to Korea to receive artist training and release albums, etc., helping Cai Xukun to develop from middle. school student to official first artist.
In January 2017, the company notified Cai Xukun to participate in performance activities, but he was refused. After that, Cai Xukun refused to participate in any activities organized by the company. On February 10 of that year, Cai Xukun proposed to terminate the “brokerage contract”, and then filed a lawsuit with the court, requesting the cancellation of the brokerage contract.
Yihai Culture does not agree to terminate the contract. In the counterclaim, Yihai Culture asked Cai Xukun to be ordered to pay 50 million yuan in damages for breach of contract, and to pay 70% of all performing arts income (including the later advertising endorsement income) obtained from his appearance in the online drama and variety show “Idol Trainee” for the company.
On October 29, 2018, the Jing’an Court issued a ruling to terminate the brokerage contract and the compensation agreement signed by both parties. However, regarding the compensation issue caused by the termination of the contract, the judgment stated that both parties can negotiate on their own, and if the negotiation fails, they can claim the corresponding rights separately. This also became a source of future disputes between the two sides.
The previous owner posted multiple expenditure evidence
Since September 2021, the case of Yihai Culture suing Cai Xukun for trust in contract disputes has been held several times. On December 1, the second trial of the dispute between Yihai Culture and Cai Xukun will be held.
From November 16th to November 21st, Yihai Culture, Cai Xukun’s former brokerage company, posted multiple Weibo posts in a row, explaining the litigation with Cai Xukun and revealing a number of expenditure evidences.
Yihai Culture said that after signing the contract with Cai Xukun in November 2015, the company invested a lot of money and resources in performing arts training, image building and publicity and promotion, and the early termination of the contract caused n company suffered huge losses. .
The evidence released by Yihai Culture includes the training contracts signed for Cai Xukun and other trainees and details of some training costs and even plastic surgery. In addition, there are photos of the company organizing promotional activities on for Cai Xukun’s group. Related materials have attracted high attention on Weibo.
(Details of expenses published by Yihai Culture)
In addition to directly going to court over the contract termination dispute, relevant legal documents show that Yihai Culture has also sued Cai Xukun in recent years and the products and companies it sells. endorsed many times, including L’Oreal, Yangshengtang, VIVO, etc.
For example, he once sued Cai Xukun, Cai Xukun studio and VIVO company, believing that Cai Xukun studio and Cai Xukun cooperated with VIVO company without the company’s permission, he agreed that Cai Xukun was the spokesperson of the vivox23 mobile phone series, and shot and many advertisements and posters and other publicity material.
Yihai Culture believes that its conduct has violated its exclusive brokerage rights, created unfair competition, seriously damaged the rights and legitimate interests of Yihai Company, and caused heavy economic losses to Yihai Company. However, most of these lawsuits ended with the withdrawal of Yihai Culture.
A top artist is enough to support a company
Although disputes with Cai Xukun continued, Yihai Culture’s own operating conditions were not optimistic.
According to the information from the enterprise search, Yihai Culture had many labor disputes, and due to its ability to perform, it refused to fulfill the obligations stipulated by the effective legal documents, and became a dishonest person subject to enforcement, with a total of 5.86 million yuan unfulfilled. The company also has 13 limited high usage records.
For Yihai Culture, Cai Xukun’s value as a master artist is undoubtedly huge. The outcome of the dispute with Cai Xukun at this time will inevitably have a great impact on the management of Yihai Culture.
In recent years, through the listing application materials submitted by some brokerage firms, the outside world has been able to glimpse the huge role of top artists in affiliated brokerage firms.
For example, the prospectus of Lehua Entertainment shows that the company achieved revenue of 753 million yuan in the first three quarters of 2022, a decrease of 15.9% from 895 million yuan in the same period last year. Among them, the income attributable to the number one artist accounted for 58.8% of the total income in the same period.
This means that Leroy’s main artist, Wang Yibo, contributed almost 60% of the company’s revenue during the first three quarters of this year. The prospectus information shows that the contract between Wang Yibo and Lehua Entertainment has been renewed until October 2026.
According to data released by another company, Fenghua Qiushi, the artist Luhan also accounts for a large part of his income. Fenghua Qiushi signed an exclusive music contract with Lu Han in 2015. In the 2018 fiscal year, Fenghua Qiushi earned 70.9 million yuan from Lu Han, accounting for 70.6% of the company’s total revenue that year.
However, too much reliance on top artists has also brought negative effects. In the past two years, with the decrease in Luhan’s activities, Fenghua Qiushi’s income has also decreased. From 2019 to the first half of 2022, revenue directly attributable to Luhan is 14.2 million yuan, 15 million yuan, 7.6 million yuan and 1.07 million yuan, respectively accounting for 25.5%, 21.2%, 9.3% and 25.2% of the company’s total revenue.
So far, the listing of Lehua Entertainment and Fenghua Qiushi in Hong Kong is still in progress.
