Trial Delayed In Talent Agency, Writers Union Fee Dispute

By Matthew Perlman
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Law360 (January 29, 2021, 9:24 PM EST) -- The trial in a dispute between the Hollywood writers union and talent agency William Morris Endeavor over fees has been pushed back to February 2022 after the sides requested a delay, partly due to the ongoing COVID-19 pandemic, and raised the possibility of a settlement.

U.S. District Judge André Birotte Jr. issued an order on Wednesday granting the joint request for a six-month delay in the suit, which includes dueling antitrust claims and other allegations, setting Feb. 22 of next year as the new trial date. The trial was originally slated to begin in August 2021.

The Writers Guild of America and WME had previously filed a stipulation telling the court that "discovery disputes, motion practice and the COVID-19 pandemic have created unforeseeable delays in the discovery process" and that an extension to the existing schedule would be needed.

The stipulation also said that "the parties wish to have time to focus on settlement talks without jeopardizing the overall litigation schedule."

The case centers on the WGA's decision to ban so-called packaging fees, which an agent can receive from a Hollywood studio for packaging a pool of talent needed for a project, rather than taking cuts of their clients' earnings. According to the guild, the fees create a conflict of interest for the agents, who may be more concerned with earning a higher payout for themselves than negotiating better rates for the writers.

A new code of conduct banning the fees, as well as a rule prohibiting agents from owning or affiliating with production studios, took effect in 2019, and the guild required its members to stop working with agents who have not signed on.

WME, Creative Artists Agency and United Talent Agency responded with lawsuits alleging that the WGA has instituted an illegal group boycott by having its members refuse to work with their agents. The cases were consolidated and the WGA lodged counterclaims accusing the agencies of colluding to institute the packaging fee model and to preserve it, along with other claims.

The judge declined the guild's request to toss the talent agencies' antitrust claims in January 2020, noting the agencies' accusation that the guild worked with non-guild members to enforce the boycott.

In April, Judge Birotte also dismissed most of WGA's counterclaims against the agencies, including federal price-fixing claims and Racketeer Influenced and Corrupt Organizations Act claims. The agencies attempted to pare the counterclaims even more, but the judge rejected their efforts in August.

UTA settled out of the suit in July after cutting a deal with WGA, and CAA reached an agreement with the union in mid-December, leaving only WME in the dispute.

Judge Birotte urged the WGA and WME to stop blasting each other online during a hearing last month, telling them to "put your Twitter fingers back in their holsters" and hammer out a deal. The judge then refused in late December to grant WME's bid for an injunction that would have halted the guild's boycott after finding it was protected action under federal labor laws.

Representatives for WME and the WGA did not respond to requests for comment Friday.

William Morris Endeavor is represented by Jeffrey L. Kessler, David L. Greenspan, Sofia Arguello, Diana Hughes Leiden and Shawn R. Obi of Winston & Strawn LLP.

WGA is represented by Stephen P. Berzon, Stacey Leyton, P. Casey Pitts and Andrew Kushner of Altshuler Berzon LLP; Anthony R. Segall and Juhyung Harold Lee of Rothner Segall & Greenstone; and W. Stephen Cannon and Ethan E. Litwin of Constantine Cannon LLP.

The case is William Morris Endeavor Entertainment LLC et al. v. Writers Guild of America West Inc., case number 2:19-cv-05465, in the U.S. District Court for the Central District of California.

--Additional reporting by Craig Clough, Lauren Berg and Julia Arciga. Editing by Peter Rozovsky.

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