Court OKs SAG foreign levies settlement

Cash for Osmond; reviews to monitor program

A state court judge has given final approval to the settlement in Ken Osmond’s class-action lawsuit over how the Screen Actors Guild’s disburses money collected from foreign tax revenues.

Los Angeles Superior Court Judge Carl West issued the approval in a 20-minute hearing on Friday and said that he’ll closely track SAG’s compliance with its terms. “The court will expressly retain jurisdiction,” he said.

Osmond, best known for portraying Eddie Haskell in the “Leave It to Beaver” series, filed the suit in 2007 over SAG’s handling of “foreign levies” collected from countries through mechanisms such as taxes on video sales and rentals to compensate copyright holders for reuse.

Osmond received $15,000 as part of the settlement, and his lawyers received $315,000. He told Variety after the hearing that he was pleased with the terms of the settlement.

“I filed the suit because I had been shorted for decades on the show, which has been running continually around the world for the last 50 years,” Osmond said.

Duncan Crabtree-Ireland, SAG’s deputy national exec director and general counsel, issued a statement saying that SAG was gratified by the court’s approval of the settlement.

“We’re pleased to have the litigation process behind us, and look forward to continuing our efforts to support our members by collecting and distributing their foreign royalties that would otherwise go unclaimed and be lost forever,” he said.

SAG has insisted since Osmond filed his suit that it’s done nothing wrong in its handling of the foreign funds for the past two decades. It announced last month that it had created an online Foreign Royalties tracker for actors and asserted that the guild has collected $18.1 million in foreign royalties for performers and has thus far distributed $8.78 million in more than 273,000 checks to more than 76,000 individuals.

The settlement requires SAG to hire an independent consultant to perform a one-time review of the program and make recommendations to improve the processing of the funds to SAG members. It also provides for an annual review of the program by a Big Four accounting firm; publication of the existence of the program and availability of the funds; and “reasonable efforts” by SAG to pay 90% of the funds to members within three years.

SAG reached a preliminary agreement in August to settle Osmond’s suit over “foreign levies” for American actors — which began to flow in 1989 after the U.S. agreed to the terms of the Berne Convention, which established the right of authorship for individuals who create works of art. SAG, the WGA and the DGA began collecting the foreign funds in the early 1990s on behalf of members and nonmembers who had a stake in films and TV programs.

Osmond’s suit contended that SAG overstepped its authority to make those agreements and never disclosed them until he and Jack Klugman threatened to file suit. A similar suit on the foreign levies issue was filed in 2005 against the WGA West by William Richert and was settled last year; another was filed in 2006 against the DGA by William Webb, who settled in 2008.

On Friday, Judge West noted that SAG had contacted nearly 100,000 people who could be recipients of the foreign funds with only 31 opting out of the settlement and only a single objection filed by Eric Hughes on grounds that the foreign levies agreement is illegal.

Hughes asserted Friday that SAG’s agreements with foreign collecting societies allegedly imdemnify the societies if claims are filed that the foreign funds haven’t been properly distributed. “The Foreign Levies program is a racket,” he said in a filing Friday.

Attorneys for SAG asserted that questions about the legality of the foreign levies agreement were outside the scope of the suit. West denied Hughes’ objection, asserting that the settlement contains safeguards against improprieties and pledging that he’ll monitor its execution.

“I have no dog in this fight,” West said. “If there’s any impropriety, that’s what I’m here for.”

Hughes told West he will file a complaint alleging that the settlement violates SAG’s duty of fair representation.

West set Sept. 30 for a status conference on the SAG and WGA settlements.

Attorneys in the case also disclosed during the hearing that Donald A. Jasko and Daniel Gervais are serving as the consultants to review the SAG and WGA foreign levy programs.

Jasko is CEO of Digital Economics and has served in various management positions at the American Society of Composers, Authors and Publishers (ASCAP). Gervais is on the Vanderbilt U faculty and has worked on international intellectual property law for the World Trade Organization, the World Intellectual Property Organization, the Intl. Confederation of Societies of Authors and Composers and Copyright Clearance Center.

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