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‘Key and Peele’ Showrunner Challenges Secret WGA Deal Over Streaming Residuals

Key and Peele
courtesy Everett Collection

The showrunner of “Key & Peele” filed a class action lawsuit on Thursday accusing the Writers Guild of America of agreeing to a secret deal that shorted him out of streaming residuals from the show.

Shortly after the show ended its five-year run in 2015, Comedy Central made the entire series — more than 300 sketches — available on its website.

In the lawsuit, showrunner Jay Martel alleges that Viacom systematically underpaid residuals — or paid nothing at all — from those streams, and from streams on other ad-supported platforms. The complaint alleges that the company did the same thing with other Comedy Central shows, including “The Daily Show With Trevor Noah” and “Tosh.0.”

The Writers Guild of America has complained that ad-supported streaming (or AVOD) has largely replaced broadcast reruns, with far lower payments to creators.

According to the complaint, the WGA brought an arbitration claim against Viacom in October 2018, charging that the cabler had systematically violated the “new media” provisions of the guild’s basic agreement. The complaint charges that Viacom was allowed under the guild agreement to use excerpts of the show online for promotional purposes, but instead simply uploaded the entire series and made it available for free, thus cannibalizing other revenue streams.

The suit charges that the WGA did not pursue the case aggressively, and ultimately abandoned it in exchange for a lump-sum payout awarding participants pennies on the dollar, and absolving Viacom of liability. The suit also states that the guild kept members in the dark about this, and that Martel, and most other members, have never seen the settlement agreement.

“The fact that the Defendants took affirmative steps to hide the Settlement Agreement from any third-party scrutiny only reinforces its indefensibility,” the suit states.

The WGA initially declined to comment, saying it does not comment on pending litigation.

A few hours later, however, it decided to weigh in after all. The guild acknowledged that there was a settlement, and argued that it got everything that it could under the contract. The guild further argued that the problem lies with the contract. It also said the lawsuit is without merit.

“The WGAW filed a claim against Viacom for failure to pay proper residuals on a number of their shows,” the guild said in a statement. “The case settled prior to arbitration for the full amount owed to writers, plus interest payments and penalties for failure to report. The writer’s frustration with the outcome stems from the fact that current industry collective bargaining agreements provide a fixed payment for the first year of free streaming and allow companies to exclude significant ‘promotional’ use of program excerpts from residuals payments. That’s a frustration the WGA shares, but it can only be solved in collective bargaining, not via arbitration, and much less by meritless lawsuits.”

Viacom has not responded to a request for comment.

The complaint accuses Viacom of breaching the collective bargaining agreement, and the WGA of violating its duty to fairly represent its members. It seeks to represent a nationwide class of writers employed by Viacom.