SM Entertainment strongly denied allegations against NCT members Johnny and Haechan and announced plans for legal action after a significant drop in stock price due to the undiscovered rumors. The response comes after online accusations from Japan claimed that certain NCT members engaged in prostitution during visits to the country.
On Jun. 4, SM addressed the issue through its complaint center, ‘KWANGYA 119′, stating, “Currently, irrational rumors involving NCT members Johnny and Haechan, such as prostitution and drug use, are being indiscriminately spread and reproduced online. After investigation, we confirm that these claims are entirely false and constitute criminal acts that severely damage our artists’ reputations.”
An official from SM continued, “We have already gathered sufficient evidence regarding numerous posts related to this matter. We will not overlook these criminal acts and intend to pursue legal action against those involved, without leniency or settlement, regardless of nationality. We want to remind everyone that posting malicious content can result in legal consequences.”
Earlier that day, several online posts alleged that some NCT members frequented Japanese night clubs. These posts, written in Japanese, included photos of drinking sessions and sexually harassing comments about specific members’ body parts. Despite the lack of concrete evidence in these posts, they quickly spread, sparking controversy both domestically and internationally.
The rumors also had a financial impact, leading to a sharp decline in SM’s stock price. According to the Korea Exchange, SM’s stock closed at 81,900 won ($59.76) on the KOSDAQ market, down 8.18% from the previous trading day, marking the biggest drop this year. At one point, the stock traded as low as $58.74, a 9.75% decrease. Foreign investors and institutions sold shares worth 6 billion won and 5 billion won, respectively.
