CA Supreme Court Hears Arguments In Talent Act Case

'It's the fabric of how the industry works,' says Los Angeles solo practitioner Donald Smiley Jr., who is arguing the personal managers' position. 'There's a power struggle about who can do what between personal managers and talent agents.'

Managers v. Agents

Tension springs from the two professions' symbiotic relationship. Personal managers aren't regulated by the state, but have broad leeway to guide clients' careers by advising them on a wide range of activities, including job opportunities and personal life choices for example, for a 15% commission. Talent agents, meanwhile, are regulated by the California Labor Commission, and focus primarily on procuring jobs and appearances for a 10% commission.

The case now before the California Supreme Court centers on actress Rosa Blasi, who in 1998 hired Marathon Entertainment Inc. and its owner, Rick Siegel, as her personal managers. Marathon Entertainment Inc. v. Blasi, S145428. She was introduced to them by John Kelly, her talent agent at the Bresler-Kelly talent agency. Two years after hiring Siegel and Marathon, Blasi landed a starring role on 'Strong Medicine,' a popular television series on the Lifetime network, which eventually ran for six seasons.

For the first two seasons, Blasi stuck to her deal with Siegel and Marathon. But in late 2001, she stopped paying commissions, claiming Siegel wasn't acting in her best interests. An angry Siegel responded by suing for breach of contract. In 2004, the state Labor Commissioner sided with the actress after finding that Siegel and Marathon had violated California's Talent Agencies Act (TAA). That 29-year-old law, codified as Calif. Labor Code Sec. 1700.5, provides civil penalties for anyone who procures jobs for entertainers without first being licensed as a talent agent. The Labor Commissioner found that Siegel and Marathon had overstepped their authority by helping Blasi procure roles ' not only for 'Strong Medicine,' but also for appearances on shows such as 'Politically Incorrect' and 'The Late Late Show With Craig Kilborn.' As punishment, the commissioner invalidated Blasi's contract with Siegel and Marathon, depriving them of possibly a huge commission.

Last year, Los Angeles' Second District Court of Appeal gave Siegel and Marathon some relief by finding that they hadn't procured the 'Strong Medicine' job for Blasi and by ruling that personal management contracts are severable. If upheld, that means Siegel and Marathon could keep commissions earned for aboveboard work conducted on Blasi's behalf, while losing any money they may have made while violating the law as unregulated talent agents.

The California Supreme Court is being asked to decide whether severability is an option under the TAA. Opponents say that most case law holds that even a single act of procurement voids a personal manager's contract and that the state legislature intended harsh punishment for individuals not licensed as talent agents. Allowing contracts to be severed, they say, would violate the TAA's intent by letting scofflaws keep some of their commission, rather than losing it all.

'The [TAA's] message to personal managers and other would-be procurers of employment was clear,' Michael Plonsker, a partner at Santa Monica's Dreier, Stein & Kahan who represents Blasi on appeal, wrote in court papers. 'If you engage in any act of unlicensed procurement, you will lose all commissions, period.' Without that deterrent, he added, 'the personal manager has little disincentive not to violate the TAA.'

Crossing the Line?

Personal managers aren't interested in registering as talent agents, court papers indicate, because that would restrict them to procurement only and a lesser commission rate. But documents filed in Marathon Entertainment Inc. v. Blasi make it clear that personal managers often blur the line when advising their clients, by making innocuous phone calls on their behalf, engaging in cocktail chitchat about their availability for work or driving them to auditions.

Gerald Margolis, a partner in Los Angeles' Manatt, Phelps & Phillips, argued in court papers that the intricate system works well until an entertainer, for whatever reason, tires of paying commissions. 'Labor Commission decisions,' he wrote in an amicus curiae brief for the National Association of Artists' Managers, 'are littered with similar stories where a personal manager struggles to achieve success for an artist, and once the artist lands a big role, the artist turns on the manager, refusing to pay commissions and terminating their relationship, citing any trivial violation.' Margolis and others argued that the Second District's decision to allow severability works for both sides because it lets personal managers recover commissions for lawfully performed services while freeing entertainers from paying for illegal procurement.

In support of Blasi, the Screen Actors Guild Inc., the American Federation of Television and Radio Artists, the Directors Guild of America Inc. and the Writers Guild of America, West, Inc. filed an amicus brief revealing that actors, musicians and other entertainers 'rely on a small army of people' to further their careers. Agents find jobs, personal managers nurture careers, business managers handle finances, attorneys provide legal services, publicists publicize and unions help set minimum standards for wages and working conditions.

The TAA itself, the guilds' brief notes, was passed to ensure there was a balance of power between wide-eyed new artists and the talent agents finding them work. 'Although it is the agent who is technically retained by the artist, most artists are not in a position of power vis-a-vis their agents,' the brief states. 'To the contrary, it is the agent who hold the keys to the artist's career and who is in the unique position to come between an artist and his work. For this reason, agents are strictly regulated.'

Smiley, who represents Siegel and Marathon, doesn't deny protections are warranted. But he says personal managers are an important part of an artist's career and shouldn't be hung out to dry for no reason. 'If the manager helps the artist get work and the artist is happy,' Smiley adds, 'life goes on, and everybody gets what they're looking for.'

'It's the fabric of how the industry works,' says Los Angeles solo practitioner Donald Smiley Jr., who is arguing the personal managers' position. 'There's a power struggle about who can do what between personal managers and talent agents.'

Managers v. Agents

Tension springs from the two professions' symbiotic relationship. Personal managers aren't regulated by the state, but have broad leeway to guide clients' careers by advising them on a wide range of activities, including job opportunities and personal life choices for example, for a 15% commission. Talent agents, meanwhile, are regulated by the California Labor Commission, and focus primarily on procuring jobs and appearances for a 10% commission.

The case now before the California Supreme Court centers on actress Rosa Blasi, who in 1998 hired Marathon Entertainment Inc. and its owner, Rick Siegel, as her personal managers. Marathon Entertainment Inc. v. Blasi, S145428. She was introduced to them by John Kelly, her talent agent at the Bresler-Kelly talent agency. Two years after hiring Siegel and Marathon, Blasi landed a starring role on 'Strong Medicine,' a popular television series on the Lifetime network, which eventually ran for six seasons.

For the first two seasons, Blasi stuck to her deal with Siegel and Marathon. But in late 2001, she stopped paying commissions, claiming Siegel wasn't acting in her best interests. An angry Siegel responded by suing for breach of contract. In 2004, the state Labor Commissioner sided with the actress after finding that Siegel and Marathon had violated California's Talent Agencies Act (TAA). That 29-year-old law, codified as Calif. Labor Code Sec. 1700.5, provides civil penalties for anyone who procures jobs for entertainers without first being licensed as a talent agent. The Labor Commissioner found that Siegel and Marathon had overstepped their authority by helping Blasi procure roles ' not only for 'Strong Medicine,' but also for appearances on shows such as 'Politically Incorrect' and 'The Late Late Show With Craig Kilborn.' As punishment, the commissioner invalidated Blasi's contract with Siegel and Marathon, depriving them of possibly a huge commission.

Last year, Los Angeles' Second District Court of Appeal gave Siegel and Marathon some relief by finding that they hadn't procured the 'Strong Medicine' job for Blasi and by ruling that personal management contracts are severable. If upheld, that means Siegel and Marathon could keep commissions earned for aboveboard work conducted on Blasi's behalf, while losing any money they may have made while violating the law as unregulated talent agents.

The California Supreme Court is being asked to decide whether severability is an option under the TAA. Opponents say that most case law holds that even a single act of procurement voids a personal manager's contract and that the state legislature intended harsh punishment for individuals not licensed as talent agents. Allowing contracts to be severed, they say, would violate the TAA's intent by letting scofflaws keep some of their commission, rather than losing it all.

'The [TAA's] message to personal managers and other would-be procurers of employment was clear,' Michael Plonsker, a partner at Santa Monica's Dreier, Stein & Kahan who represents Blasi on appeal, wrote in court papers. 'If you engage in any act of unlicensed procurement, you will lose all commissions, period.' Without that deterrent, he added, 'the personal manager has little disincentive not to violate the TAA.'

Crossing the Line?

Personal managers aren't interested in registering as talent agents, court papers indicate, because that would restrict them to procurement only and a lesser commission rate. But documents filed in Marathon Entertainment Inc. v. Blasi make it clear that personal managers often blur the line when advising their clients, by making innocuous phone calls on their behalf, engaging in cocktail chitchat about their availability for work or driving them to auditions.

Gerald Margolis, a partner in Los Angeles' Manatt, Phelps & Phillips, argued in court papers that the intricate system works well until an entertainer, for whatever reason, tires of paying commissions. 'Labor Commission decisions,' he wrote in an amicus curiae brief for the National Association of Artists' Managers, 'are littered with similar stories where a personal manager struggles to achieve success for an artist, and once the artist lands a big role, the artist turns on the manager, refusing to pay commissions and terminating their relationship, citing any trivial violation.' Margolis and others argued that the Second District's decision to allow severability works for both sides because it lets personal managers recover commissions for lawfully performed services while freeing entertainers from paying for illegal procurement.

In support of Blasi, the Screen Actors Guild Inc., the American Federation of Television and Radio Artists, the Directors Guild of America Inc. and the Writers Guild of America, West, Inc. filed an amicus brief revealing that actors, musicians and other entertainers 'rely on a small army of people' to further their careers. Agents find jobs, personal managers nurture careers, business managers handle finances, attorneys provide legal services, publicists publicize and unions help set minimum standards for wages and working conditions.

The TAA itself, the guilds' brief notes, was passed to ensure there was a balance of power between wide-eyed new artists and the talent agents finding them work. 'Although it is the agent who is technically retained by the artist, most artists are not in a position of power vis-a-vis their agents,' the brief states. 'To the contrary, it is the agent who hold the keys to the artist's career and who is in the unique position to come between an artist and his work. For this reason, agents are strictly regulated.'

Smiley, who represents Siegel and Marathon, doesn't deny protections are warranted. But he says personal managers are an important part of an artist's career and shouldn't be hung out to dry for no reason. 'If the manager helps the artist get work and the artist is happy,' Smiley adds, 'life goes on, and everybody gets what they're looking for.'