2020

By Nellie Andreeva    Deadline                                                                                                             June 8, 2020 7:45 pm

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California Gov. Gavin Newsom on Friday released the long-awaited guidelines for restarting film and TV production amid the ongoing pandemic, allowing filming in the state to resume on June 12.

While no one expects cameras to start rolling this Friday, wheels in the industry are turning in hopes to get to that point before the end of the summer.

“To reduce the risk of COVID-19 transmission, productions, cast, crew and other industry workers should abide by safety protocols agreed by labor and management, which may be further enhanced by county public health officers,” the California Department of Public Health said in the guidance released via the Governor’s office.

Reaching an agreement on safety protocols between the management and the Hollywood union and guilds is the next big hurdle following the Governor’s sign-off. That sign-off came just days after the industrywide labor-management safety committee talk force organized by the Alliance of Motion Picture and Television Producers, which represents the major Hollywood studios, submitted to the California and Los Angeles Governors a White Paper featuring health and safety guidelines for production during the COVID-19 pandemic.

I hear AMPTP is currency in discussions with the major unions and guilds that represent essential on-set staffers and talent, including IATSE, DGA SAG-AFTRA and the Teamsters. I hear the producers are carrying separate negotiations with each union that are often intersecting.

The hope is to reach deals with the unions/guilds so pre-production could start sometime in July if the rate of coronavirus infections and hospitalization in Los Angeles County does not trigger another tightening of restrictions on businesses. Given the complexity of filming during COVID-19 due to detailed safety protocols that need to be followed, pre-production — as well as actual production — are expected to be lengthier than normal.

Of the four biggest Hollywood production hubs, Los Angeles, New York, Atlanta and Vancouver, three, Los Angeles, Atlanta and Vancouver, have set provisional production restart dates, all contingent on local health conditions and studio-guild agreements.

While Georgia was among the first states to reopen their economies, I hear Los Angeles-based productions may start first because plane travel continues to be a deterrent for talent due to COVID-19 concerns. Meanwhile, British Columbia continues to impose 14-day quarantine to anyone entering the country, which would include Hollywood actors and directors flying in to work.

Along with the major studios and streamers, the DGA, SAG-AFTRA, IATSE (including the Art Directors Guild and the Costume Designers Guild), the Teamsters and others were involved in the process of crafting of the recommendations in the White Paper submitted to the Governors.

In another promising sign, at the document’s reveal, the unions and guilds all lauded it as a “solid foundation” and “a critical first step” in the road back to production.

But they also cautioned that more needs to be done. “The discussions will continue between the Producers, the Unions and Guilds over how it affects our respective agreements,” Hollywood’s Teamsters Local 399 said in a message to its members last week. “There is still a lot of work ahead of us to not only ensure the safety of our members on set, but also to ensure the jobs of our members and our collective bargaining agreements are protected throughout this process.”

So far, the International Cinematographers Guild, IATSE Local 600, has issued its own protocols. The other unions and guilds have said that they too are working on their own sets of guidelines which should be released in the coming days.

The Big 3 talent agencies, having already won a partial victory in their yearlong legal battle with the WGA over packaging fees, now are asking a federal judge to dismiss all of the guild’s remaining claims.

In a 25-page motion filed Wednesday, WME, CAA and UTA asked U.S. District Court Judge Andre Birotte Jr. to toss out the WGA’s remaining claims of price-fixing, unfair competition and breach of fiduciary duty.

Read the agencies’ latest motion here.

On April 27, the agencies declared that they’d won a “resounding victory” after Birotte dismissed major portions of the WGA’s case when he ruled that the WGA lacks antitrust standing to pursue its federal price-fixing claim; lacks organizational standing to bring claims for breach of fiduciary duty and constructive fraud on behalf of its members; lacks standing to bring an Unfair Competition Law (UCL) cause of action on its own behalf; failed to plead racketeering activity by the agencies, and failed to state claims upon which relief can be granted with respect to its group boycott claims.

The WGA filed an amended complaint on May 11 that sought to reinstate many of the claims the judge had dismissed, asking the court to “declare that packaging fees constitute a breach of the agencies’ fiduciary duties to their writer-clients,” and to find that “the agencies’ packaging fee practices constitute constructive fraud.”

The agencies, however, are now asking the judge to throw the WGA’s case out entirely, arguing that the counterclaimants – the WGA East and West and seven of their members – “fail to correct any of their prior pleading defects and assert a revised collection of counterclaims based upon substantively unchanged factual allegations.”

The judge allowed the guilds to proceed with their price-fixing claims under California’s Cartwright Act, but the agencies now argue that that claim “fails for a lack of antitrust standing,” and that “the guilds cannot bring claims for breach of fiduciary duty, constructive fraud, or a Cartwright Act claim on behalf of their members.”

The agencies also argue that the Cartwright Act claims should be dismissed in their entirety “because neither the guilds nor any of their members have standing under California law.”

The agencies also told the judge that he should not reinstate the constructive fraud claims – which he already dismissed – that have been re-submitted by the seven individual writers in the case, because they have made “no new factual arguments” in their amended complaint – “just more rhetoric about how packaging constitutes fraud all of the time.”

Arguing against the WGA’s request for a court-ordered injunction that would bar packaging fees outright, the agencies also took issue with the WGA’s claim that it’s been harmed because it had to install a staffing submission system to help find jobs for its agentless members who in April 2019 were ordered by the WGA to fire their agents who refused to sign the WGA’s code of conduct, which banned packaging fees and agency affiliations with related production entities. Those mid-tier agencies that have signed the guild’s revised code can now continue packaging until the end of next year, unless any two of their competitors at the Big 3 and ICM Partners agree to sign the code before then.

“The Guilds allege that they have spent money to create a self-designed staffing system to replace services formerly performed by talent agents, including those at the Agencies here,” the Big 3 said in their latest motion. “Running an independent staffing service is of course a decision made by the Guilds, not a choice forced upon them by any conduct of the Agencies. This fact alone dooms any claim of Article III standing” under the Unfair Competition Law.

“Further, it is pure speculation that the Guilds’ ostensible need to provide this staffing service would be cured by an injunction to end packaging or to require the Agencies to make more specific packaging disclosures. Indeed, many talent agencies have already succumbed to the Code of Conduct, have resumed representing writers, and agreed to eventually cease providing packaging services to their writer-clients. Yet, the Guilds nonetheless allegedly continue to provide their staffing services. Further still, there is no way to know whether one or more of the Agencies here would ever agree to the Code of Conduct, which bans not only agency packaging but also content affiliates. Thus, it is not at all clear how an Unfair Competition Law injunction against Agency packaging would redress the Guilds’ purported need to provide staffing services.”

The agencies, noting that the issue of the WGA’s negotiations with these other talent agencies who have signed its code is not before the Court, said that the WGA East and West “also contend that they are suffering ongoing harm because ‘the Guilds have been required to accept Code revisions that phase out the ability of Guild-franchised talent agents to accept packaging fees on future projects instead of immediately barring such fees, and that are contingent in part upon at least one of the Agencies agreeing to the revised Code.’

“More specifically, the Guilds allege that because of their decision to permit other talent agencies — i.e., not the Agencies here– to temporarily continue packaging, the Guilds have been required, at least temporarily, to continue to ‘monitor’ packaging by other agencies and ‘educate’ their members about packaging.

“Putting aside the extraordinary nature of the Guilds’ acknowledgment that they are franchising agencies who continue to package – a practice that the Guilds purport to believe always amounts to a tort – it hardly supplies Article III standing. For one thing, it is hard to imagine a more obviously self-inflicted harm. For another, these allegations center around franchise agreements that the Guilds negotiated and executed with third parties who are not before the Court, and the conduct of third parties is insufficient to confer Article III standing as a matter of law.”

The agencies also told the judge that the packaging they still do involving actors and directors is not even involved in this matter, and will continue no matter the final disposition of this case. “Finally, the Guilds allege that packaging fees paid in deals involving other parties, e.g., an actor or a director, reduce Guild dues revenue. But the injunction the Guilds seek – against the Agencies packaging writers – does not even purport to stop the Agencies from continuing to package actors and directors and thus would not redress the purported – and implausible – harm of which the Guilds complain. Nor would the Guilds conceivably have standing to seek any injunction to stop the Agencies from providing packaging services that their non-writer clients continue to desire. This is yet another implausible over-reach to try to manufacture non-existent Article III standing under the UCL.”

A hearing of both sides’ motions has been set for July 10.

The WGA wants a piece of the foreign box office – a residual its members long have been denied when their feature films are shown overseas.

“When residuals for feature films were first negotiated in 1960, the foreign box office was minuscule,” the guild’s negotiating committee said today in a message to members about its ongoing negotiations for a new film and TV contract. “Today, the foreign box office is three-quarters of the worldwide total. It’s long past time for screenwriters to share in the generated revenue and receive a foreign box office residual, just as writers do with foreign television.

For the past 60 years, writers received no residuals when their films are shown in foreign markets. The writer’s initial compensation covers the exhibition of the film theatrically, including all foreign theatrical releases. Residuals are triggered only when films are released in supplemental markets, such as on television, home video and pay TV. In television, residuals are triggered when shows are aired in foreign markets. SAG-AFTRA and the DGA also get residuals from the foreign distribution of TV shows but not for films.

Like the WGA, SAG-AFTRA is currently in contract talks with management’s AMPTP, which probably won’t give writers a new category of residuals that it’s not giving to actors or directors. The DGA got a new contract in March that did not include residuals from films shown theatrically in foreign markets.

The negotiating committee’s latest missive includes several other proposals it’s seeking at the bargaining table, including:

MINIMUMS: We want to substantially raise feature minimums, in large part to protect those who may not yet have the clout to earn above-scale fees.

STREAMING MINIMUMS: We’re seeing the convergence of longform programs and theatrical films made for streaming (SVOD). We need feature minimums to apply to all feature-length SVOD projects, whether they are contracted as made-for-SVOD or as a feature.

FEATURE TEAMS: We seek to increase minimums for writers working in teams of two or three. Health fund contributions for individual writers on teams of two currently cap out at $125K. This leads to many screen team members struggling to keep their healthcare coverage while working on a project for more than a year. It’s a similar problem for the pension plan – contributions for writers on teams cap out at a portion of what they would be if the writer worked alone. We are proposing that the full pension & health benefit contribution cap (currently $250K) apply to each member of the team, rather than the lower ceiling that applies now.

PENSION & HEALTH CAPS: We are proposing an increase in the contribution caps to $400K for both pension and health. This would ensure that more writers receive the benefits they deserve for their work and could help writers on long-gestating projects avoid losing healthcare coverage.

COMPENSATION FOR REPEATED PITCHES: Writers understand that crafting a pitch to get hired is part of the job. However, with sweepstakes pitching, cherry-picking of ideas, and endless bake-offs, the pitch process can devolve into an unpaid months-long think tank. We are proposing a two meeting rule: if a buyer asks for a second meeting to work on the pitch, this will trigger a guaranteed payment for the writer’s time and effort.

GUARANTEED 2ND STEP: In the last decade, the proliferation of one-step deals has exacerbated free work abuses. For screenwriters earning less than 200% of minimum, a second step should be guaranteed. The reality is that most writers are already doing 2nd, 3rd and even 4th steps in their so-called one-step deals. This is a low-cost solution that will help return the industry to better past practices.

PAYMENT STRUCTURE: Unpaid producer passes and late payments are clear violations of the MBA, yet both are rampant. These free passes often delay both the delivery of the completed script and the writer’s delivery check. To address this and compensate writers throughout their employment on a project, this no-cost proposal would give the writer the choice of being paid on a weekly pro-rated basis instead of two lump sums.