SAG Pension Plan Gets 2d Shot at Golf Ad Payments

(CN) - Trustees of the Screen Actors Guild employee benefit plans won reinstatement of their lawsuit accusing an advertising agency of stiffing them on contributions for commercials featuring professional golfer Fred Couples.

TaylorMade-Adidas Golf Co. recruited Couples in 2003 to appear in commercials and endorse its products on the greens. Its exclusive advertising agent, NYCA, was part of a collective bargaining agreement with SAG, the actors' union. TaylorMade was not.

TaylorMade and NYCA split the bill for Couples' services, with NYCA paying the golfer about $102,000 and TaylorMade paying him "significantly more," according to the 9th Circuit ruling.

But when NYCA paid SAG under the union agreement, it based its contributions on its own payments to Couples rather than the total amount he made on the deal.

The trustees of SAG's employment benefit plans were not happy with this calculation. They claimed that TaylorMade, even though it has no contract with SAG, is liable for the remaining contributions as a "joint employer" of the golf pro.

The 9th Circuit in San Francisco reversed dismissal of the case, saying the contract between SAG and NYCA does not make it clear whether the advertising agent has to base its contributions on TaylorMade's payments to Couples, even though TaylorMade has no contract with SAG.

"The question whether Couples' 'gross compensation' includes sums paid by TaylorMade is not clearly answered," Judge O'Scannlain wrote.

The appellate panel reversed and remanded, ordering the lower court to "determine whether the parties' practice, usage, and custom - as well as other appropriate aids - to interpreting an ambiguous contract - sheds light on the meaning of 'gross compensation.'"

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.

Email *

Submit