The statements released by HoMin and their fathers show exactly where they stand regarding the cosmetics business. They all point to the cosmetics business as the cause of the lawsuit. As matter of fact, the fathers' statements describe the problems with the cosmetics business in detail, how the conflict really blew up after a meeting between the parents and the CEO of SM. For your information, that meeting was recorded, and SM submitted the transcript of the recording as evidence to the court for their lawsuit.
Some fans dispute the credibility of the statements because it came from HoMin/SM side, but the statements are signed documents released to the public, which puts liability on HoMin and their parents for the contents of the statements. They can be sued for libel for what's written in them, but there was no response from CJS's side regarding the statements, not even a single press release refuting the claims in the statements.
There are also rumors questioning the authenticity of the statements, another attempt at discrediting the statements, but I am not even going to waste keystrokes explaining those since they're all hearsay without any proof. HoMin and their parents never expressed any objection to the statements, so the statements must be from them, period.
Many fans argue that CJS won't break TVXQ just for a measly cosmetics business, but part of the answer to that is in Changmin's father's statement. He quotes a phone conversation with one of the parent talking about listing the cosmetics business on Kosdaq - the Korean Stock Exchange - through backdoor listing.
Backdoor listing is a way for a company to get listed on the stock exchange without satisfying strict and complicated listing requirements by merging the business with an already listed company. It's an easier and faster way to list a company that may not meet the listing requirements.
As long as the company is legit and produces profit, there's nothing wrong with making money from company stocks.
The problem with CJS's cosmetics business was that it was aiming to artificially raise the value of the company by using TVXQ's fame, and although it may not be illegal, it's definitely shady. There's also talk of insider trading by sharing information, which could be considered illegal.
Some fans probably read an article about Korean singer Rain and his involvement with J.Tune Entertainment, and how his reputation took a big hit among Korean investors and general public. Here's an article about it from AllKpop.
I have no idea if Rain was right or wrong, but it is a fact that his reputation was greatly damaged because of his business, and same thing could easily have happened to TVXQ. Rain is still taking the rap from the public because of what happened with J.Tunes.
So how much were the parents looking to get from listing the business on Kosdaq? According to the conversation quoted in the statement, 10's and 100s of millions of dollars, which I think was enough motivation to break the group especially since that money can be earned in lump sum.
Having said that, that still does not give enough reason for SM to interfere with the business. I personally think there's nothing wrong with artists making money off of their fame, and I even think it is their right to do so. Then why did SM oppose the business?
I will write about the reasons in my next post.