Film Company Says Union Played Dirty Trick

     LOS ANGELES (CN) – Film production company Nu Image claims a movie union tricked it into signing a collective bargaining agreement by lying about residual contributions to benefit plans, in a $5 million federal complaint.
     Nu Image, which has produced movies such as “The Expendables,” “Olympus Has Fallen,” “Texas Chainsaw 3D,” and “Playing for Keeps,” sued the International Alliance of Theatrical Stage Employees (IATSE) on Tuesday, alleging intentional and negligent misrepresentation.
     Nu Image claims it endured 11 years of union campaigns aimed at making it sign a collective bargaining agreement. This was from 1995 to 2006.
     “These campaigns involved picketing Nu Image productions, harassing Nu Image employees and threatening Nu Image executives with violence if Nu Image did not sign a CBA with IATSE,” Nu Image says in the lawsuit.
     The protests forced Nu Image, which was a nonunion independent company, to modify its productions and finally agree to bargaining agreements on a per-motion picture basis, but the agreements never contained any requirements that it make residual contributions, the company says.
     Residual contributions are derived from revenue earned in secondary markets, such as DVD sales and paid TV.
     Worn down by the union’s interference, Nu Image says, it agreed in 2006 to negotiate with IATSE for a collective bargaining agreement. But it made it clear that it would not sign such an agreement if it required it to make residual payments to the Motion Picture Industry Health and Pension Plans, Nu Image says.
     Nu Image executives told IATSE it would be virtually impossible to pay residual contributions and still operate profitably, the company claims.
     “During these negotiations, top IATSE officials made representations to Nu Image that it would not be obligated to pay residual contributions to the plans. Without these representations, Nu Image would not have entered into the CBA with IATSE. However, these representations were false and they were made to induce Nu Image to enter into the CBA,” according to the complaint.
     Believing the union’s promises, Nu Image says, it did not make residual payments to the plans – and ended up facing a lawsuit in 2013 from directors of the benefits plans for failing to make the residual contributions.
     Nu Image asked the union to confirm that their agreement did not require residual contributions, but IATSE denied that it had said any such thing, according to the complaint.
     Nu Image and the union reached a confidential settlement agreement in February.
     Now Nu Image wants to recoup the money it spent defending and settling the lawsuit. It estimates its damages will exceed $5 million.
     Nu Image is represented by Martin Katz with Sheppard, Mullin, Richter & Hampton.
     Neither Katz nor IATSE immediately responded to a request for comment.

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