On February 7, Lee Soo-man's legal representative, Hwawoo Legal Firm, released a statement explaining his stance on suing SM Entertainment for breaching business regulations. SM Entertainment recently signed a partnership contract with Kakao Entertainment, and it was only later revealed that the two labels took illegal measures to make Kakao the second largest shareholder of SM, coming up to 9.05% of their shares.This was done without informing Lee Soo-man, who is not only the agency's founder but also its largest shareholder. The co-CEOs, Lee Sung-soo and Tak Young-joon took the agreement from Align Partners, who was next in line with Lee Soo-man as SM's largest stakeholder. Hwawoo stated,"Align Partners made a series of proposals to appoint an auditor for SM Entertainment's regula shareholder meetings last year and since then, there has been various dispute ovver the management rights made against Lee Soo-man, as requesting access to accounting book and board meeting notes."Previously, it was also revealed that there was a management dispute between Soo-man and Align Partners (a shareholder activist fund). Issues pertaining to new stocks and convertible bonds are considered illegal under such circumstances. This causes many disadvantages, decreases in shares, and lessens control of the company for the existing shareholders, which makes Soo-man's stance fair given his position.Razores@razoresyachtChris Lee took advantage of the company's internal conflict and the retirement of Lee Soo Man to attract Kakao. It is clear that it is illegal to issue new shares in the midst of internal company conflicts and without the permission of the founder of SM Entertainment.16733Chris Lee took advantage of the company's internal conflict and the retirement of Lee Soo Man to attract Kakao. It is clear that it is illegal to issue new shares in the midst of internal company conflicts and without the permission of the founder of SM Entertainment. https://t.co/GlEf8iBZA0Netizens react to Lee Soo-man's stance to sue SM Entertainment, the very company he foundedHwawoo's statement provides a clear explanation of the circumstances that led to Soo-man's stance. It reads,"On January 20 of this year, SM Entertainment's co-CEOs Lee Sung-soo and Tak Young-joon agreed to Align Partners' proposal without consulting Lee Soo-man, the company's largest shareholder."It continues, "It's clearly illegal for SM Entertainment's board of directors, which is led by the co-CEO's, to issue new shares and convertible bonds to third parties at a time when there's a dispute with in the company."As SM unilaterally distributed new shares and convertible bonds to Kakao, it did so for reasons that appear to be illegal."(They signed with Kakao) in order to expand their reach and make things more favourable to them and they attempted to secure a competitive edge in contolling the direction of the company."Upon realizing SM Entertainment's illegal actions, Lee Soo-man is set to sue the company and take legal action against it and its employees who were engaged in the same."We will block SM Entetainment's board of directors' attempt at this through an injunction, banning the issuance of new shares and convertible bonfs ans we will hold the directors responsible for this both civilly and criminally liable."Following the news hitting the internet, many were stunned to learn of the company turning against its own founder. Though it was later revealed that such things are quite common in the business industry, netizens applaud Lee Soo-man for taking a brave stance and being willing to challenge the issue publicly and legally.thelly@forloeyangyangdude lee soo man, who founded SM, is going to sue SM???? DAMN IT WILL BE BLOODY 19416dude lee soo man, who founded SM, is going to sue SM???? DAMN IT WILL BE BLOODY 😭☾⋆ 𝕭𝖞𝖊𝖔𝖑 ⋆☽ will see Treasure 💎@nahidaraiden22I think y'all should not celebrate at what's happening to SM no matter how you hate SM and #LeeSooMan coz' Kakao is a ticking to all idols in HYBE, SM, YG & JYP. Let me just remind you how Kakao ruined multiple GGs in Big 4 and getting away with it and now they're joining-- twitter.com/Koreaboo/statu…Koreaboo@KoreabooLee Soo Man Is Going To Sue SM Entertainment For Illegal Businesskoreaboo.com/news/lee-soo-m…183Lee Soo Man Is Going To Sue SM Entertainment For Illegal Businesskoreaboo.com/news/lee-soo-m…I think y'all should not celebrate at what's happening to SM no matter how you hate SM and #LeeSooMan coz' Kakao is a ticking 💣 to all idols in HYBE, SM, YG & JYP. Let me just remind you how Kakao ruined multiple GGs in Big 4 and getting away with it and now they're joining-- twitter.com/Koreaboo/statu…𝐵𝓎𝓊𝓃𝓃𝒾𝑒 - i'm luna :))@ForBaek_11othrswe might hate SM due to the unfair treatment they gave to their artist/groups specially the foreign line, but we cannot deny the fact that we are all thankful that Lee Soo Man created the groups that we consider our home and safe place. Because of LSM we have them. 🥺62we might hate SM due to the unfair treatment they gave to their artist/groups specially the foreign line, but we cannot deny the fact that we are all thankful that Lee Soo Man created the groups that we consider our home and safe place. Because of LSM we have them. 🥺❤️A 🍒@positionsofloeyTHIS MAN IS NOT LEAVING WITHOUT A FIGHT OMGTHIS MAN IS NOT LEAVING WITHOUT A FIGHT OMGHe has received massive support from fans and netizens in general as they realized the larger effects of the issue. Soo-man's stance is not only to protect his own distribution of shares but also the distribution of the same to other shareholders. This includes artists under SM Entertainment along with the profits they'll earn from their albums and comebacks.ً@iwaspinkvenomedlee soo man exposing all of sm's secrets after getting kicked out of sm out fo the blue, I would've sued too idgaf twitter.com/Koreaboo/statu…Koreaboo@KoreabooLee Soo Man Is Going To Sue SM Entertainment For Illegal Businesskoreaboo.com/news/lee-soo-m…34557Lee Soo Man Is Going To Sue SM Entertainment For Illegal Businesskoreaboo.com/news/lee-soo-m…lee soo man exposing all of sm's secrets after getting kicked out of sm out fo the blue, I would've sued too idgaf😭 twitter.com/Koreaboo/statu…natani ⁷ ⩜⃝ ²⁶@_natani_LEE SOO MAN TAKE THE ARTISTS AND START A NEW COMPANY WITH NORMAL TREATMENT21LEE SOO MAN TAKE THE ARTISTS AND START A NEW COMPANY WITH NORMAL TREATMENTseconddecember@heavenenough@Koreaboo let lee soo man build another agency and all the artist can go there712@Koreaboo let lee soo man build another agency and all the artist can go theresoobin’s moabell ♡ ✨ 🎭@doiepicsnow that someone has dumbed down the lee soo man situation to me, i hope he do sue them8now that someone has dumbed down the lee soo man situation to me, i hope he do sue themAs fans realize the heat of the situation, they’re happy to learn that Lee Soo-man was quick to resolve the issue by taking proper action against it, which protects many people under the company. Naturally, they also hope the circumstances are resolved and their partnership with Kakao stands invalid.