Judge Refuses WME’s Bid to End Writers’ Boycott - Hollywood Reporter
Meanwhile, the agency is claiming that the guild didn't reply to its updated overture before a rejection: "There was no counter to our proposal, nor any offer to meet and engage."
After its Dec. 22 overture to make a deal to represent scribes for the first time in 20 months was denied by the Writers Guild of America, talent agency WME is claiming that the guild didn't counter its updated proposal before the rejection.
"WME presented an updated proposal that made a series of concessions just four days following our hearing on December 18. We made clear our willingness to engage in further dialogue with the WGA at any point during the holidays. We know this is how every other agency finally reached a deal — they had the opportunity to have a discussion with the Guild to address their specific needs, and that is what we have continuously tried to do in an effort to get a deal done," read a statement from a WME spokesperson.
The WME rep added: "However, instead of responding directly to us, once again we learned indirectly through media reports that our proposal was rejected by way of a leaked letter the WGA Negotiating Committee sent to Guild members. There was no counter to our proposal, nor any offer to meet and engage. While we find this tactic unhelpful in reaching a resolution, we will persist in our efforts toward reaching a new franchise agreement.”
Meanwhile, a U.S. District Judge ruled against the agency's bid for a preliminary injunction to halt a boycott by the guild. A WME spokesperson didn't immediately reply for comment on the ruling.
On Dec. 29, the Writers Guild's agency negotiating committee sent a note to its members outlining the reasons it was rejecting a deal with WME, adding: "Having sat mostly on the sidelines for the past 20 months, there will be no 'going last' bonus for WME – no accommodation for the fact that they are the most conflicted of all agencies – no alterations to our existing deals that soften the protections that writers have fought for nearly two years to achieve."
The Beverly Hills-based WME, led by president Ari Greenburg, is the last major holdout talent agency in a standoff with the Writers Guild. The talent firm, part of the entertainment and sports conglomerate Endeavor, is a sister company to film and TV company Endeavor Content, which has worked on 200 projects over the course of the last year.
The Writers Guild has called agencies' affiliation with production companies a conflict of interest and has required firms that represent its members to reduce their ownership interest in such entities to a 20 percent stake. The guild has also asked for more transparency about the private equity owners of agencies. (Private equity firm Silver Lake Partners holds the majority stake in Endeavor, run by CEO Ari Emanuel.)
In the Writers Guild's WME rejection note on Dec. 29, the agency negotiating committee said that Endeavor did not agree to place its ownership stake in Endeavor Content in a blind trust and claimed that "WME insists that they and an entity owned by Silver Lake may, together, own more than 20% of Endeavor Content." Sources close to WME dispute the guild's characterization and claim that Endeavor and Silver Lake are willing to reduce their stake in Endeavor Content to 20 percent.
Over the past 20 months, after thousands of writers parted ways with their agents in April 2019, the Writers Guild has signed up small boutiques as well as larger talent agencies to new agreements, including Paradigm in March, UTA in July and ICM Partners in August.
On Dec. 16, WME rival CAA became the latest major agency to make a deal with the guild, and the agreement was notable given that CAA backs a production entity, film and TV studio wiip. The agreement states that CAA, and its private equity majority owner TPG, will divest its stake in wiip to 20 percent and provide evidence of the sale in a timeline that wasn't publicly disclosed. The guild and CAA also agreed to withdraw legal claims.
Two days after the CAA deal, lawyers for WME and the Writers Guild spoke during a court hearing presided over by U.S. District Court Judge André Birotte Jr., who entreated the agency and the guild to make a deal. "Find a path to try to resolve this," stated Birotte.
On Wednesday, Birotte denied WME's motion for a preliminary injunction, writing that the court "lacks jurisdiction" regarding the matter and that the "group boycott" organized by the Writers Guild is protected. "Defendants’ group boycott against Plaintiff has not involved unlawful acts or substantial and irreparable injury to property," wrote Birotte.
Birotte ruled that even if WME could establish a likelihood of prevailing on its group boycott claim, that a federal court was unable to issue an injunction thanks to the Norris-LaGuardia Act, the nearly century old law that stripped courts of the power to enforce union-busting contracts. While the talent agency argued this wasn’t a typical labor dispute between employer and employee, Birotte responds: “Disputes involving the contractual means (i.e., the ‘how’) of labor representation does not convert this matter into a non-labor issue. Undoubtedly, this controversy springs from a labor dispute within the meaning of the Norris-LaGuardia Act.”
By coming to the conclusion that an injunction was beyond the scope of his powers, Birotte avoided a deeper analysis of the merits of WME’s antitrust claims. If the talent agency can take any solace from the Dec. 30 ruling, it’s that it has avoided a disastrous ruling stating it has no shot in ultimately winning a case premised on the assertion that writers are unlawfully colluding with others to hurt WME’s business.
5:35 pm PST Updated with details from the U.S. District Judge's ruling on WME's bid to end the Writers Guild boycott.
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