As a seasoned gamer with years of navigating the complex landscape of virtual worlds, I can’t help but draw parallels between my adventures and the ongoing saga unfolding in Hollywood’s talent management scene. The Talent Agencies Act (TAA) seems to be akin to a game rulebook, setting boundaries for what agents and managers can and cannot do. However, just like in games, there always seem to be loopholes waiting to be exploited.
Over the past few years, California’s legislation has been a source of discontent among Hollywood talent managers, as it potentially strips them of their earnings (commissions) should they be implicated in practices linked to securing employment opportunities for their clients.
The discussion revolves around the Talent Agencies Act, a law designed to supervise talent agents and protect their clients by ensuring they act ethically. This legislation stipulates that only licensed agents can secure employment within the entertainment sector, and any manager found doing so could see their contracts invalidated and forfeit their earnings. While the intention was to curb dishonest business practices, such as conflicts of interest, it has increasingly been used by talent to evade commission payments. Over the past 55 years, approximately $250 million in fees have been declared null and void, according to an industry association representing entertainment managers.
However, in 2020, a former CAA employee discovered an anomaly in the law that supervisors could exploit. In his viewpoint, it was unnecessary to obtain a license to facilitate job prospects for clients, as long as one was willing to bear the risk of being sued and potentially losing the commission.
It appears that this former CAA employee is implying uncertainty regarding the correct procedure for managers to obtain materials, as they don’t hold a license from the California Labor Commission. The email suggests that if the artist doesn’t take legal action against the manager, it seems that managers may not face any issues?
The idea presented in that communication served as the foundation for the business strategy at Range Media Partners, a company established later that year by former partners from several agencies and specialized in management and brand development, as stated in a lawsuit filed on Monday in the Los Angeles Superior Court by CAA against the company. This legal action aims to obtain a court injunction preventing Range from continuing to breach the Talent Agency Agreement (TAA) by undertaking tasks reserved for licensed agents and representing Writers Guild of America members without the guild’s approval, which could jeopardize key functions related to securing work opportunities for talent, essentially shutting down essential operations.
The core issue at hand in the complaint is that Range allegedly obtained confidential information to lure clients away, which has broader implications for the firm’s overall business operations. CAA asserts that Range, who did not respond to a request for comment, is merely disguising itself as a management company to evade laws and union contracts that provide it with an edge over competitors. In reality, Range appears to be functioning like a talent agency while simultaneously structuring deals in ways that traditional agencies cannot. For instance, the lawsuit suggests that the company allows high-profile clients to bypass paying a commission by instead providing them a producer fee or credit on their project.
According to the prominent talent agency’s grievance, the founders of Range reportedly informed some of their CAA clients that they didn’t require a talent agent to secure work, as Range was capable of handling everything on its own.” This complaint alleges the misuse of confidential information regarding client negotiations, earnings, personal preferences, areas of interest, and upcoming ventures, among other things.
In the investor presentation, Range claimed it was the “innovative” replacement for agencies like CAA and Endeavor, as stated in the lawsuit. It boasted about its strategy to attract top-tier agents from their current firms, and to fundamentally change the representation system. Additionally, it highlighted production services as a significant source of income.
As a gamer, I’ve been keeping an eye on Range for four years now, and it’s been making waves in the talent agency scene. It may not be one of the big guys like CAA, but it’s certainly making its mark after gobbling up ICM Partners in 2022. Investments from heavyweights like Steve Cohen’s Point72 Ventures, John Malone’s Liberty Global, and David Bonderman’s Wildcat Capital have given it a boost. Add to that family entertainment giant Playground Productions and A+E Networks, who are co-producing scripted TV projects with Range, and you’ve got a formidable competitor on your hands.
The emergence of Range occurs during a period when artists are pondering whether they need an agent at all. Following the Writers Guild of America’s lawsuit against Hollywood’s top four talent agencies in 2019 over packaging fees and agency-owned production companies, many writers decided to part ways with their agents. Notable figures like Damon Lindelof never rehired them. Some, such as Jennifer Lawrence and Leonardo DiCaprio, have been without agents for years now. These two prominent celebrities are currently represented by Rick Yorn of LBI Entertainment, a business management firm, as the entertainment industry transitions into one where agent and manager roles tend to overlap. Essentially, both offer career guidance and participate in activities aimed at securing work for their clients.
In recent times, there’s been a noticeable trend as agents are transitioning towards management roles. For instance, Theresa Kang-Lowe and Phil Sun have moved on from WME to establish their own management companies. Moreover, a group of individuals including Dave Bugliari, Mackenzie Condon Roussos, Rich Cook, Michael Cooper, Susie Fox, Sandra Kang, Rachel Kropa, Chelsea McKinnies, Peter Micelli, Lucinda Moorhead, Mick Sullivan, and Jack Whigham have departed from top-tier agencies to become the founding partners at Range. Some former CAA employees who joined Range are currently in arbitration with the agency regarding cancelled equity.
Previously, I was the one with all the clout, no question about it. But now, it seems like the balance is shifting. The management firms could be breaking the monopoly. (As a gamer, I’d say, “Back in the day, I was the boss, no debate, but now, it looks like the managers might be shaking things up.”)
Still, the gambit could backfire on management firms engaged in “procuring” work for clients. The Deftones in 1997 filed a complaint with the California labor commission seeking to void agreements with ex-manager Dave Park for violations of the TAA. A commissioner later voided fees on the basis that Park secured 84 performances for the band. Marathon Entertainment owner Rick Siegal later sued the state Attorney General in a lawsuit claiming it’s unconstitutional to enforce the law on talent managers. After he lost that case, nearly 200 talent managers supported his appeal to challenge the TAA, which still stands.
In the lawsuit it filed, CAA asserts that the TAA prohibits Range from performing tasks related to securing work for clients, and that talent cannot solely resort to civil lawsuits in response. However, whether CAA is entitled to seek a court order preventing future violations of the law is uncertain, as they may not have been directly impacted by the actions taken.
In such a situation, it could fall upon the Writers Guild of America (WGA) to take action against Range Media Partners if they are found to be breaking rules, specifically those concerning the acquisition of work for clients. According to CAA, Range is accused of breaching a guild rule that prohibits agencies from functioning as packaging agents or owning a substantial share in a production company.
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2024-10-03 02:25