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Hollywood Agents Blast Writers Guild With Deadline Looming

By Max / Published on Saturday, 06 Apr 2019 15:58 PM / No Comments / 403 views

In a message underlining the diminishing prospect for a deal between Hollywood agents and writers, the agents’ top negotiator has excoriated leaders of the Writers Guild of America.

Karen Stuart, executive director of the Association of Talent Agents, sent the message to members Friday evening, with only 28 hours left to work out a new deal. The WGA is expected to require its 15,000 members to fire agents later in the weekend under a new “Code of Conduct” due to the inability of the two sides to hammer out a revised franchise agreement by 12:01 am PT Sunday.

The Code of Conduct, which was overwhelmingly approved by WGA members recently, requires that agencies agree to eliminate television packaging fees and ownership interests in production companies. The WGA has asserted that the practices amount to inherent conflicts on interest and threatened several times to file suit against CAA, WME, UTA and ICM Partners.

Stuart contended in her message that the WGA is incorrectly claiming it has broad authority over agents and that the Code of Conduct would regulates the conduct of agents in all respects. She also took issue with the WGA claiming the right to delegate authority to managers and attorneys to negotiate for writers — a prospect that has left Hollywood increasingly unnerved about the possibility of what’s being called “Wrexit.”

The two sides have not held a negotiating session since March 26. The agencies proposed on March 21 that writers be given the opportunity to opt in on packaging deals and have emphasized that writers need “individual choice” — which the WGA has derided as code for union-busting.

Stuart also sent ATA members an FAQ with answers to 16 questions about what will happen when franchise agreement expires with the assertion: “The Guild’s ‘no compromise’ position could soon throw our industry into chaos.”

Currently, there are more than 150 agent signatories to the Artists’ Manager Basic Agreement, which has remained in place since 1976 as a franchise agreement between the WGA and ATA. The WGA has yet to disclose which agencies have signed the Code of Conduct. Speculation is rising that the WGA leaders are hopeful that firing most agents will lead to larger agencies subsequently agreeing to the Code of Conduct. Stuart warned agents against doing so in her message.

“To put it simply, the WGA’s proposed ‘Code of Conduct’ is unacceptable to all agencies —
from those that employ two agents to those employing 2,000,” she said.

“The Code would impose a unilateral mandate, granting the WGA power over your business operations and providing the Guild with an unprecedented level of control to dictate how your agency operates. This self-proclaimed power grab will enable the WGA to change the terms of the agreement on 90 days’ notice, after the initial fixed term, regardless of the effect it will have on agencies and their business models.”

Stuart continued to maintain that the agents are blameless for the situation and that it’s the WGA fault for not understanding how negotiations work along with the WGA being unwilling to compromise.

“Since last year, we have repeatedly tried to meet and engage in meaningful, productive
conversations with the WGA,” she said. “They refused and would only agree to meet via their formal negotiation process involving the passing of documents and a 50-person room. These methods are not conducive to an honest, productive dialogue. As negotiators, we all know this
is not how you get a deal done.”

“We provided a comprehensive solution that gives writers what they want — choice, transparency, and safeguards,” she added. “Meanwhile, the WGA continues to take a ‘no compromise’ stance – just two days ago, they sent us a modified version of their proposal that was materially identical to the previous version of their proposal,” she added.

Here’s Stuart’s entire message:

Dear Members,
As you know, the Artists’ Manager Basic Agreement (AMBA) that has governed the successful
working relationship between agents and writers for 43 years will expire this Saturday, April 6.
While there are many unanswered questions and understandable concerns at this time, the
ATA is committed to keeping you well-informed as we work through this process with the
Writers Guild of America (WGA) and aim to address the issues dividing our two organizations
as quickly and effectively as possible.
The WGA claims it has broad authority over agents and is empowered to force agents to sign
a Code of Conduct that regulates the conduct of agents in all respects. The WGA claims it has
the right to delegate “its authority” to managers and attorneys to negotiate for writers. ATA
disagrees.
To put it simply, the WGA’s proposed “Code of Conduct” is unacceptable to all agencies —
from those that employ two agents to those employing 2,000. The Code would impose a
unilateral mandate, granting the WGA power over your business operations and providing the Guild with an unprecedented level of control to dictate how your agency operates. This self-
proclaimed power grab will enable the WGA to change the terms of the agreement on 90 days’ notice, after the initial fixed term, regardless of the effect it will have on agencies and
their business models. Specifically, this harmful new precedent would require you to:
– Disclose confidential client information, even against your clients’ wishes, including but
not limited to, quarterly financial statements, copies of deals, and invoices.
– Report regularly to the Guild on a variety of subjects, including employment data, film
budgets, and lists of projects where the agency is providing services.
– Get the Guild’s approval (or disapproval) of film finance deals negotiated by your
agency on your clients’ behalf.
– Subject all disputes to Guild-selected arbitrators, with loss of franchise and substantial
financial damages determined by a single arbitrator with no appeal.
As we’ve said from the start, writers will also be negatively impacted by the WGA’s proposed
Code. Quite simply, the Code removes artists’ choice and decision-making about how they
want to navigate their own careers. It also reduces job opportunities for writers and artists by
hamstringing the film financing market and by eliminating production entities that are
producing shows and films that may not otherwise get made.
Since last year, we have repeatedly tried to meet and engage in meaningful, productive
conversations with the WGA. They refused and would only agree to meet via their formal
negotiation process involving the passing of documents and a 50-person room. These methods are not conducive to an honest, productive dialogue. As negotiators, we all know this
is not how you get a deal done. We provided a comprehensive solution that gives writers what
they want — choice, transparency, and safeguards. Meanwhile, the WGA continues to take a
“no compromise” stance – just two days ago, they sent us a modified version of their proposal
that was materially identical to the previous version of their proposal.
For all these reasons, the ATA is firmly opposed to WGA’s Code because we do not believe it is
in your best interest or the best interests of your clients. The seismic shifts in the media
landscape are creating new challenges for artists and disruption across the industry, while
simultaneously generating positive change and opportunity. We need strong agencies of
every size and interest to help artists push against these forces and thrive amidst the change.
To that end, we invite and encourage you to attend our member meeting next Wednesday,
April 10, from 10 a.m. to 12 noon. Please see attached for the meeting invitation and RSVP
information. At this meeting, we will provide additional facts and information on the WGA’s
harmful proposals, update you on our thoughtful approach through this process and answer
any questions you have about the process and our counterproposals.
Also attached for your information and use is an FAQ to help answer some of the most pressing
questions your agents may have as we approach and move beyond the WGA’s self-imposed
April 6 deadline to reach a new negotiated franchise agreement.
As always, our collective voices are strong. We must remain united and steadfast as we
continue to work in good faith toward a new long-term agreement that protects the best
interests of all writers, artists, and agents.
Karen

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