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California Court of Appeal Rules on Formerly Licensed Attorney Who Continued as Talent Manager
It isn't novel for an entertainment attorney to decide to move into artist management and perhaps provide related services for talent. Conflict of interest is a red-flag concern when an attorney becomes a talent manager. But what happens when a formerly licensed attorney continues to provide management services for talent? A recent decision by the California Court of Appeal addressed the issue.
In Bacall v. Shumway, B302787 (Cal. Ct. App. 2021) — decided "unpublished" in February before being designated in March as "published" — Jeffrey Shumway had served as long-time attorney and manager for actor/screenwriter Michael Bacall. Bacall ended the relationship in 2017, after learning Shumway had changed his California State Bar status to "inactive" several years prior. Shumway's Timaeus Group, with which Bacall had entered into 2016 and 2017 agreements, moved to arbitrate Bacall's termination of the relationship with Shumway. Bacall and his loan-out company RBC Entertainment in turn filed suit against Shumway in Los Angeles Superior Court, alleging legal malpractice, fraud and breach of fiduciary obligation, among other things.
But the trial court approved Shumway's motion to compel arbitration. The arbitrator then ruled in favor of Bacall by finding Shumway had provided unlicensed-attorney "legal" services. The arbitrator allowed Shumway to keep $406,394 in payments he received as chief content officer for Bacall, but ruled Shumway had to repay $201,026 in commissions he earned from Bacall. The latter because the arbitrator was unable to determine how much of the those monies Shumway had been paid for management services and how much for legal services. The trial court confirmed the award.
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