The WGA, in an email sent on Friday afternoon, said the holdout agencies have not supplied enough details as to how they will comply with the guild’s demand that they limit their investment in their respective production affiliates to 20%. CAA launched its Wiip production affiliate in 2018 while WME’s parent Endeavor Group Holdings created its own production arm, Endeavor Content, in 2017.
The guild, in a message through its agency negotiations committee, said CAA and WME have not done enough to provide adequate levels of transparency.
“The agency’s restructuring — and its continued compliance — must be subject to third-party oversight and verification,” the WGA said. “This is necessary because the agencies are privately held companies whose structures are entirely obscured from public view. Unlike packages, which can at least be ascertained in show budgets and profit statements, the Guild would have to take compliance on faith alone. That we will not do.”
CAA announced on Sept. 14 that it had agreed to sign the WGA’s franchise agreement, but the guild responded by saying it would not accept the terms as presented by the agency. CAA said at that point that it had agreed to the same terms that ICM agreed to when it signed a deal with the WGA in August to end the practice of packaging fees within two years. The WGA revealed Friday that WME has agreed in theory to the 20% ownership limit.
“Today, the WGA sent both WME and CAA a proposal that outlines the steps each of them must take in order to be in compliance with the 20% ownership cap on production affiliates in the franchise agreement,” the guild said in its messageon Friday. “At the same time, we sent them a renewal of our initial information request, which they have, up to this point, only partially satisfied.”
“As a reminder, both CAA and WME have agreed, in theory, to the 20% cap provided for in the UTA/ICM agreement. What they have not done is spell out how they will actually comply. WME says it wants until 2022; CAA has given no specific timeline, saying that it will sell when ‘commercially practicable,” the WGA added.
The message revealed that earlier this month, at the request of both CAA and WME, the WGA agreed to confidentiality regarding certain corporate information that might be disclosed, but stressed that the agencies have not done enough: “While both agencies have now provided some corporate structure information, much of it was already publicly ascertainable, and most of our requests have gone unanswered. Any agreement must start with openness and full disclosure. We cannot protect writers from conflicts that are deliberately hidden from us.”
More than 80 agencies are now allowed to represent WGA members after agreeing to a limit on agency packaging fees and affiliate production. WGA members were told on April 13, 2019, by WGA West president David Goodman to fire their agents if they had not agreed to bans on packaging fees and affiliate production.
Several mid-sized agencies — Abrams Artists (now A3), APA, Rothman Brecher Ehrich Livingston, Verve, Kaplan Stahler and Buchwald, and Paradigm — signed deals with the WGA in the months following the firings. UTA and ICM Partners signed this summer.
CAA, UTA and WME sued the WGA and consolidated their antitrust suits last year against the guild into a single action, accusing the union of engaging in an illegal group boycott. UTA is no longer party to the suit, which is still scheduled to go on trial in August in Los Angeles.
CAA and WME did not immediately respond to requests for comment on Friday.