Leaders of the Writers Guild of America have repeated a threat to sue the major Hollywood talent agencies for alleged conflicts of interest.
The leaders issued the threat Saturday during a members-only meeting at the Writers Guild Theater in Beverly Hills, Calif., attended by about 300, according to an attendee. The meeting was the fourth held this week in order to rally members to approve of “Code of Conduct” that will bar agencies from collecting packaging fees and having ownership interests in production company.
Online voting among the 15,000 members ends Sunday. If the code is instituted, members will be required to fire agents who have not signed on to the code as of April 7, following expiration of the current franchise agreement — which regulates how agents represent WGA members.
Several WGA officials said during the meeting that a lawsuit against the agencies is being prepared but would not say when or if it will be filed. In response to a question as to why the suit has not been filed already, the officials responded by saying that they have held off partly because of the significant amount of time needed to resolve litigation.
Officials also said during the meeting that the WGA may seek intervention in the dispute from the California government, but added it’s unlikely to seek federal intervention. Agents are subject to state regulation in California.
The WGA issued a cloaked threat of a lawsuit on March 12 with the issuance of its report, titled “No Conflict, No Interest,” which targeted CAA, WME, UTA, and ICM Partners and asserted that the four agencies handle 75% of the transactions involving members of the WGA. The report invoked the 1962 antitrust suit by the U.S. Justice Department, which forced MCA to get out of the agency business after a decade of acting as both a producer and an agency.
Ellen Stutzman, the WGA West’s assistant executive director, said on March 12, “CAA, WME and UTA are positioning themselves to become the next MCA.” She refused to elaborate at a news conference that day as to what strategy would be employed.
Saturday’s meeting was led by WGA West president David Goodman and WGA West executive director David Young. Concerns were expressed by members over the WGA’s plan to provide alternatives to members after the members have fired their agents, but the overriding sentiment was to strongly support the guild leaders.
The meeting came a day after the WGA blasted Endeavor, the parent of WME, over a report that it’s planning an initial public offering.
“Today’s announcement that Endeavor plans to become a publicly-traded company only strengthens the call for the conflicted and illegal practices of the major talent agencies to end,” the guild said. “It is impossible to reconcile the fundamental purpose of an agency — to serve the best interests of its clients — with the business of maximizing returns for Wall Street. Writers will not be leveraged by their own representatives into assets for investors.”
The agencies have asserted that the WGA’s demands for the elimination of agencies receiving packaging fees and having ownership interest in affiliate production companies are not feasible. The WGA and Association of Talent Agents have held seven unproductive negotiating sessions since Feb. 5. After the most recent session of March 26, both sides issued rancorous statements and blamed each other for the lack of progress. No new sessions have been scheduled.
The ATA made counter-proposals at a March 21 session that contain provisions for more accountability and transparency by agencies for clients including giving writers consent over whether a television show is packaged. The negotiations are the first effort to revamp the 43-year-old franchise agreement.