Actor Lee Jung Jae Accused Of Attempting To Unfairly Seize Management Rights In Production Company
Actor Lee Jung Jae is embroiled in a legal dispute with the CEO of Raemongraein, a drama production company he acquired this year.
On June 10, KST CEO Kim Dong Rae issued a lengthy statement to investors, stating that Lee’s company, Artist United, had filed a lawsuit against him for damages and was trying to secure management rights through an extraordinary general meeting. He blasted Lee for never visiting the company nor having any specific vision for the future management of Raemongraein.
Artist United, where Lee Jung Jae is the biggest shareholder, acquired Raemongraein in March this year. According to CEO Kim, just three months after becoming the largest shareholder, Artist United used the company’s cash assets as a shell to acquire a suspended entertainment company.
Contrary to our initial discussions before the investment, I learned that Artist United used Raemongraein’s funds to acquire a suspended entertainment company. This move by (Lee and Artist United), just three months after becoming the largest shareholder, appears to be an attempt to use Raemongraein’s cash assets as a shell to acquire another company.
—Kim Dong Rae
Kim also mentioned Lee Jung Jae in the statement, adding that while he had expected Raemongraein to achieve global expansion through Lee’s involvement, he has shown no interest in the company’s growth as an investor.
While Raemongraein’s current management opposes the acquisition of the suspended listed company, Artist United has notified the management to hold a general shareholders’ meeting to discuss replacing the CEO, changing the company name, replacing the entire board, and amending the articles of association. Kim responded to this move by saying, “We cannot let Raemongraein become a victim of forces attempting to seize management rights through deceptive methods.”
Artist United’s legal representative has argued that Kim has been blocking the investors from exercising their rightful participation in management.
While the involvement of Lee Jung Jae and (actor) Jung Woo-sung in Raemongraein’s management was discussed, Kim has refused to comply with the investors’ requests. He has ignored the rightful request for an extraordinary general meeting, blocking investor participation in management.
—Artist United
In response to the lawsuit, Kim called on Lee Jung Jae and other investors to stop their “unjust attempts” at seizing management power and instead engage in “sincere and reasonable discussions” about the company’s future.
Meanwhile, Raemongraein, which produced dramas like Sungkyunkwan Scandal (2010) and Reborn Rich (2022), has Artist United as its largest shareholder, with 18.44% of the shares. Lee Jung Jae, in addition, personally holds 5.12% of the shares. Their combined shares total 23.56%. CEO Kim holds 13.42% of the shares, while the company’s director, Yoon Hee Kyung, holds 0.51%.
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