tvxqfangril85 said:

I'll take the time to answer you since there aren't a lot of people who were actually around for that. I will summarize the best that I can. 1) When the news hit the media, let's just say they were all over the place. They were trying to interview the members, their parents, friends and anyone related who they could find. SM released vague statements saying "This is because of the cosmetics company...we'll handle it". Then Soo Man Lee (who was in America at the time) wrote on Twitter "TVXQ must not disband. They are the leaders of the Hallyu Wave. We can't let it happen. I'm on my way back to Korea to handle this." SME had announced that TVXQ would be doing a press conference to address all the rumors. However they cancelled it the day before. It was supposed to be live streaming for international fans. I'm still pissed that we never got to hear them publicly address this. 2) People didn't see SME as a horrible company at first (except for fans of HOT and Shinhwa who were trying to tell us what happened in the past but many Cassies didn't want to listen). We all hoped that it would blow over soon. It wasn't until months later that we got word from JYJ that the reason they were suing had to do with disproportionate pay and excessive contract terms.The boys released a statement saying that they had suffered physically and emotionally due to their unfair contract with SME. However SME kept throwing out all kinds of excuses for what the lawsuit was really about to confuse us.

Soon mediators stepped in to try and get them to negotiate. Two meetings took place. JYJ had two demands: shortened contracts and more proportionate distribution of income. They made it clear several times that they had no wish to leave TVXQ or SME. They merely wanted SME to void the old contracts and make new ones. However insiders told us that negotiations were not going well. SME refused both demands and insisted that JYJ drop the lawsuit. It was about this time that we heard a recount of Jaejoong and Yoochun leaving the SME building shouting at a few SME executives. SME suspended all of TVXQs activities at this point. The preliminary trial of JYJ vs SME preceded. It was then that the public learned the dreadful details of TVXQs contract and started hating the company. 3) Boa, SNSD, Suju and Shinee remained quiet throughout most of the preliminary trial. We didn't even hear much from Yunho and Changmin. But that was because there were a lot of

people giving false interviews to the press pretending to be relatives or close friends of JaeChunSu (as they were referred to by the media at that time). So the judge ordered a "gag order" against everyone who was close to the trio which included their members so that they couldn't talk to the press. I do remember SNSD members Jessica and Tiffany saying on Soompi that they wanted the group to stay together as five. International Cassies asked if there was anything they could do but there wasn't. There was also an anonymous interview given by a member of Super Junior who claimed that the members had all had a meeting once they heard that JaeChunSu were suing; ultimately they decided not to sue as a group. However the member said that his situation was getting worse; he had a 13 year contract and said that SME was starting to make the group pay for everything similar to TVXQ due to the success of Sorry, Sorry. We later found out that it was Hangeng who gave the interview. At that time it wasn't known that a member of Suju had that type of contract. SME released a statement after the preliminary hearing in which JaeChunSu were granted a partial verdict that had Shinee members signatures on it. The letter basically stated that the members were happy with their SME contracts and were not mistreated by SME. Then were the infamous letters from the fathers of Yunho and Changmin stating that the true reason for the lawsuit was JaeChunSu investing into a cosmetics company and that they merely out for more money. Letters from Yunho and Changmin followed saying basically the same thing and that they want the trio to drop the lawsuit so that they could get back to work. It's worth noting that months later in 2010 the CEO of the cosmetics company in question Crebeau released a statement that he knew for a fact that Yunho and Changmin had not written those letters. He said that he confronted SME staff about it and they admitted that the letters were typed by the staff but insisted that those letters reflected what Yunho and Changmin felt. He denounced SME publicly for purposely trying to start a rift between the trio and the duo. He said that because of those letters there had been a misunderstanding created between the members. 5) JaeChunSu only released their initial statement. Their lawyers handled the majority of the PR. In their new magazine, the trio revealed that they were told not to say anything at that time because it would only make things worse and fuel more gossip. While the lawsuit was going on in Korea, the member were still active in Japan as five. They were featured in numerous magazines and also continued their TohoMobile (it's basically like an app you can get on your phone to receive up dates on everything the members are doing). They were saying things like "we want this to be over so that we can go back to being five",

"we hope that the lawsuit ends quickly and peacefully" and "we want to stay together". This is the reason fans didn't think that they would actually split up and why it's still shocking to a lot of us. 6) When SME suspended all of TVXQs activities as a group in Korea, Yunho filmed Heading to the Ground and Changmin debuted as a model in Japan being regularly featured in women and teen girl magazines. His drama Paradise Meadow was postponed for a long time.They didn't make many direct statements just like the trio. 7) Other idols didn't say much publicly about it. It was mainly a lot of discussion amongst politicians, professors, financial advisers and such in Korea, Japan, China and all over Asia. Everyone was trying to analyze TVXQ's contracts and make sense of it. There were also a lot of journalists writing possible solutions to the problem. It was all over the news; being discussed by people who didn't even know who TVXQ was until then. There were radio programs in which they spoke in-depth about the situation and people calling in to ask questions about what was going on. Also, there were numerous stories about how the disbandment of TVXQ was going to disrupt the Hallyu Wave which is why a lot of Korean companies and such were reportedly offering the trio money to go back to drop their lawsuit against SME because they felt that the whole mess was making Korea's brand look bad to the international community. 8) The Japanese reaction was on par with the Korean reaction. There were tons of stories. The tabloids in Japan were spreading gossip like that Yunho decided to not sue because his father owed Soo Man Lee money and crazy stuff like that. Japanese financial analysts did reports about their contracts and how they could be made better. There were also people saying that TVXQ should stop working in Korea and stay in Japan permanently. BTW their last interview that I recall as five was in Vivi magazine 2010. http://sharingyoochun.net/2010/02/25/trans-vivi-magazine-april-issue-tohoshinki-profile/ But they were in a lot of Japanese magazines in 2010 to promote Best Selection 2010. If you want to know more, let me know!
If you're interested, I also did a post about this a while back on my Live Journal. Though I deleted it, I still have the rough draft.It's kind of long but it's from a fan girl's perspective:

I dont really know where to start with this since the situation has been going on so long and there are many things that have happened. Firstly, dont believe everyone who insists that they know the truth about TVXQs split. Most of them are highly biased and want to persuade you to their side. Also, a lot of them werent even around when it happened; they merely use second hand information. Second, there are a lot of things that only the members and those around them actually know about how and why this whole fiasco came about. I can only tell you from a fangirls point of view what happened. I remember the exact day still when I read the news that JaeChunSu (as they were referred to by everyone at the time) were announced to have filed a lawsuit to stop the effects of their contract. Soo Man Lee tweeted enroute back to Korea that TVXQ must not disband since they are the stars of Asia. This situation will be cleared up soon. All of us Cassies had no clue what was going on. Soon SME released a statement saying that JYJ were only doing this because they wanted to invest in CreBeau and make a lot of money. Til this day a lot of people still believe this to be true despite everything that happened afterwards. The boys released a statement saying that they had suffered physically and emotionally due to their unfair contract with SME. The trio made two demands: shortened contracts and more proportionate distribution of income. Once the preliminary trial started, the details of TVXQ's contracts were finally revealed to the public. Cassies and everyone in the Korean Entertainment Industry were appalled to find out that JYJ hadnt been paid since February 2009. According to their contract, the boys did not receive compensation for their merchandise or appearance fees. They would only receive payment if their album reached 500,000 copies in sales. Furthermore, the boys paid for everything: their managers salaries, their dancers fees, their hairstylists and clothing stylists, their own food, travel and accommodations as well as their own music videos and the parking of their staff members. They even paid for Junsus cough medicine! The way it works is that SME receives all the profits and proceeds that the boys earn. They were to be paid twice a year (every six months). SME would then subtract the costs that they called overhead and give the boys would was left over. Theyd then split that five ways. Except in 2008-2009 nothing was left over for them. In fact, they received a statement that they owed SME money. The court sided with JYJ and granted them a partial judgment. The reason for this as stated in the ruling is that they wanted JYJ to return to TVXQ. Since all five of the members have interconnecting contracts, if they void JYJs contracts it would affect HoMins contracts as well. The judge decreed that the trio could pursue solo endeavors without interference by third parties ie SME. Also, that if SME agreed to it the trio could still perform as TVXQ even if they went to another company (kind of like SS501). Things got worse after that. SME kicked JaeSu out of the dorm. Junsu went to live with his parents. Jaejoong moved in with his friend Kim Hyunjoong from SS501. The boys stopped traveling together. They split into JaeChunSu and HoMin. SME released letters from Shinee, Homin and the fathers of Homin. The now infamous letters pretty much blamed CreBeau and JYJ for everything. However it was later discovered that CreBeau had nothing to do with the lawsuit. In fact, SME knew all about the boys investing in the cosmetics company. All of us Cassies were witnesses to the trip that the trio took to China to meet up with other investors in early 2009. Their SME manager was with them also (something that

he later denied). It was also found later that HoMIn never wrote the letters. Executives from SME admitted this to the CEO of CreBeau but insisted that the letters represented the duos true feelings. SMEs CEO Kim Young Min was indicted twice for publicly blaming CreBeau for the lawsuit. Then SME did something unexpected. They held an impromptu press conference outside of the SME building. They declared that JYJ had made fools of us all. According to them, JYJ were greedy liars that only wanted more money. They demanded that JYJ drop the lawsuit and return to the studio to prepare for the groups spring comeback (hence the recorded version of Maximum with OT5). They gave them until early November to respond.We all waited anxiously to see what the trio would do. On the stated day, JYJ merely told SME to talk to their lawyers and respect the judgment of the court.But of course SME did not. They proceeded to block JYJ in Korea and stop them from being a part of TVXQs activities. JYJ retreated to Japan were they officially became a unit called JEJUNG/JUNSU/YUCHUN or JJY under AVEX at the second half of 2010. Things were going good at first. The Japanese press regarded JYJ as TVXQ in many magazines and they were carrying on TVXQs dominance in Japan. HoMin waited over a year for the matter to be cleared up. Then SME announced that they would be resuming activities as TVXQ. JYJ were shocked by this. They seemed convinced that it was SMEs doingnot what HoMin wanted. Neverheless that is how we got to where we are nowmore or less. *About TVXQs contracts At this point I want to clear up a misconception that the five members signed 13 year contracts. This is false. The initial contracts that the members signed varied in length from each other. Some had 5 year contracts while others had 7. At one point, Junsus contract was only 10 years. It was altered twice afterwards, including the length and the profit distribution ratio. There is a clause in their contracts that gives SME the right to lengthen their contracts without them being present. So over time TVXQs contracts became 13 years. SMEs rationale for this is that they intended for the group to debut in four to five countries and they needed amble time to do so. *Shenzhen Concert Scandal After the lawsuit was filed, the five members still came together for a final stop on their 4th Asia Tour Mirotic concert in Shanghai. They gave valiant performances for their fans and even cried at the end. Yunho declared that they wanted to be together forever. However at the end of the concert, fans were surprised to find out that there would be one final stop in Shenzhen for the concert. The promoter told fans that the boys were practicing hard and would put on a stage like weve never seen before. Fans from all over the globe were vying for the tickets. Everyone was sure that this would be the last time we saw all five of them on stage together since the media speculated that disbandment was imminent for TVXQ.The tickets sold out in a minute. The servers crashed. But weeks later SME announced that the concert was canceled. The reason they gave was because JYJ refused to participate. JYJ rebuked this by saying that theyd never agreed to the concert in the first place.

SME refuted that by showing a contract with the trios signatures on it. JYJ released a statement saying that their signatures were forged. Cassies were distraught. We didnt know what to believe. Chinese Cassies did some reporting and found that SME hadnt even had a permit to hold the concert. This led many to believe that they had never intended to hold the concert in the first place. Korean Cassies got the police involved. They went to the SME building and found the guy responsible for the forgery. He was questioned and admitted to signing the contract. However nothing could be done since almost every Korean Entertainment company employs a forger whos job is to sign documents on behalf of idols when they are unavailable or abroad. Hed signed many of TVXQs documents in the past. So he was let go. This event was significant because it marked the turning point in which Cassies and others began to deeply distrust SME. Hence a lot of the anti-SME sentiment was born and still remains.