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Ready for round two of the WGA-ATA saga? First, a quick history lesson.
In 1924, a music booking company formed in Chicago, IL. The Music Corporation of America (MCA) grew quickly and in 1962 merged with Decca Records. Decca at the time owned Coral Records and Brunswick Records, as well as an 89% controlling stake in… Universal Studios.
In order to acquire Universal, MCA was forced by the Department of Justice to dissolve its talent agency—which represented most of the industry's biggest names—because owning both the movie studio and a talent agency violated antitrust laws.
In case you missed that, let me repeat: a talent agency owning a studio violates federal antitrust laws. These are laws that have been in place since the passing of the Sherman Act in 1890.
Present day. WME owns Endeavor Content. CAA owns WIIP. UTA owns Civic Center Media. ICM probably just hasn’t come up with a terrible enough name for their studio yet, but surely it’s coming.
Talent agencies owning studios violates antitrust laws.
What is the ATA’s argument when it’s pointed out that what they’re doing is illegal? Oh, those? They’re just “affiliate companies” housed in “separate buildings” so don’t worry about it. Cool, cool. Nothing to see here, guys.
The ATA’s defense of packaging fees is equally compelling. They haven’t even tried to argue that packaging fees are good for us because there's literally no angle to take there.
They also can’t counter the WGA’s argument that what there doing represents a conflict of interest and violates their fiduciary duty… because of course it does.
So what’s the ATA’s argument? It can be summed up thusly: “Well, you can’t guarantee that the money they’re giving us in packaging fees will go to anything useful so it’s totally okay for us to keep doing it.”
No, really, that’s the argument. They're not refuting the illegality or impropriety of their actions but rather focusing on the money. I know, you're shocked.
Where to start with that. Well, first…
Secondly, whether the money reverts back to the project or not isn’t even the issue. The issue is to getting agents to refocus on their clients. To do their jobs. To be, what’s the word… agents.
But in response to their “argument”... the answer is no, we can’t guarantee with absolute certainty that the studios won’t just keep the money. But if it’s money they were willing to spend on folks doing nothing, odds are good they’ll spend it on folks doing something.
The studio executives I’ve spoken to in the last 24 hours reiterated as much to me. They’d rather see that money on screen, whether that be in the form of a larger writing staff, guest actors becoming regulars, or a swing set they wouldn’t have be able to afford before.
More than that, we know money will revert back to the project BECAUSE IT ALREADY HAS. Just asked David Shore, creator of House and The Good Doctor:
“I insisted a show I was developing not be packaged. As a result, I controlled the points that would’ve been allotted to the agencies and increased my budget by an amount equal to the packaging fee. That extra money now goes to the show, where it belongs, to use as we see fit.”
So, what happens now? Well, 330 days ago the WGA sent proposals to the ATA. To this point they still have given no formal response to those proposals.
On March 25th, the members of the WGA will vote on whether to establish a Code of Conduct that bans conflicts of interest, much like all sports agents are required to sign (including the ones at CAA).
If the membership votes in favor of the Code, then agencies that want to represent writers will have to sign it. This goes for all agencies, big and small.
At the moment, the big four have given no indication that they will sign the Code. And several of the smaller agencies have aligned themselves with the big four. This is not surprising.
Smaller agencies see the money being made by CAA, UTA, ICM, and WME and aspire to get there. They have big city dreams, and it serves them for those revenue avenues to remain open.
As of April 6th, any agent not signed to the Code of Conduct will be unable to represent WGA writers. They will be voluntarily walking away from their clients. The choice is theirs — do they want to represent us or not?
There's more. Particularly about what happens after this point that includes EVEN MORE HISTORY BITS, but...

Tired now. More later.
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