Hearing set for Jan. 6
The union filed the 18-page motion Wednesday, asserting that the plaintiffs’ claims under state law should be tossed because they are “completely preempted by federal labor law” and that the plaintiffs “do not have the authority to sue on behalf of anyone other than themselves.”
SAG-AFTRA also insisted that it has complied with the demand for access to review of its financial records — attempting to parry extensive allegations that members and elected leaders have been kept in the dark about the funds.
“While plaintiffs can maintain a cause of action on their own behalf alleging that their own funds have been converted, plaintiffs have no right to possession or transfer of amounts allegedly owed to others and therefore their claims for others must once again be dismissed,” the motion said.
Sunny Wise, attorney for the plaintiffs, said, “Plaintiffs will resist all motions and believe defendants motions are designed once again to mislead and diffuse issues.”
A hearing has been set for Jan. 6 before U.S. District Court Judge Manuel Real.
The plaintiffs’ amended complaint was filed Oct. 23. “Defendants have failed to pay plaintiffs and others the money it has collected in a time frame acceptable under any reasonable business practice,” it alleged. “Defendants have likewise taken an unauthorized commission or fee for the collection of residuals and foreign royalties/foreign levies.”
The motion, filed by attorney Robert Bush, came in response to this amended complaint and asserted that the suit’s claims are pre-empted by federal law and would require the court to analyze the union’s collective bargaining agreements (CBAs) under which the funds are collected.
“While the CBAs require producers to forward residual payments to the union for distribution, those provisions do not expressly require the union to distribute the residuals in any particular time-frame or in any particular manner,” the filing said.
SAG-AFTRA had filed its original dismissal motion on July 31 and Real narrowed the issues on Oct. 7, allowing the suit to include the issue of residuals and three of the 16 plaintiffs to proceed with their claims on unpaid foreign royalties.
Real had also denied a motion to strike a reference to SAG-AFTRA national exec director David White in the suit in connection with his work at Entertainment Strategies Group prior to his 2009 appointment to the top SAG post. Convicted felon Marc Dreier invested in Entertainment Strategies Group, which closed down after Dreier was charged with masterminding a massive fraud scheme.
The suit alleges that SAG-AFTRA has improperly withheld funds and stonewalled requests for information about $130 million held in trust by the union — including domestic residuals and foreign royalties collected by the union through foreign collecting societies without authorization or knowledge of union members. The suit also alleges that the union has cashed residuals checks and then claimed an inability to locate the actors to whom it owes money.
Additionally, the action alleges that the union has withheld information by filing incomplete LM-2 annual reports with the U.S. Dept of Labor and by moving to seal court records.
After the Oct. 7 hearing, attorneys for SAG-AFTRA declared victory and labeled the suit “frivolous.” But the plaintiffs had indicated they would proceed along with filing a second suit alleging corruption and breach of fiduciary duty against White and chief administrative officer and general counsel Duncan Crabtree-Ireland.