The agreement resolves a nearly two-year legal battle between a powerful Hollywood agency and the Writers Guild over talent packaging fees.
LOS ANGELES (CN) — The Writers Guild of America and talent firm William Morris Endeavor announced Friday they’ve reached a settlement that ends a bitter legal standoff over talent packaging fees.
The Beverly Hills-based firm will sign a franchise agreement with WGA that immediately restores the firm’s ability to represent screenwriters.
Most TV and film writers hire talent agencies like WME to find them work and negotiate package deals or contracts that bundle multiple talents for a project with studios.
The guild accused the talent agencies of negotiating deals that heavily favor studios’ contract terms while driving down writers’ wages, decreasing job opportunities and cutting into union fees.
As part of the deal, agencies will phase out the practice of packaging by June 30, 2022, according to an email WGA sent to its members Friday.
The email also said WME will be required to reduce to 20% its stake in productions put out by its parent company Endeavor and Endeavor’s private equity owner Silver Lake.
“Specifically, WME is currently majority-owned by Silver Lake, and WME hopes in the future to become a publicly-traded corporation,” the email said. “Both of these circumstances required complex negotiations in order to ensure one thing: that WME be required to behave as a proper fiduciary, putting writer clients first regardless of the agency’s ownership structure.”
The deal — which expires in April 2025 pending year-by-year extension — stipulates dismissal of all claims and counterclaims remaining in the lawsuit that has played out for nearly two years in the U.S. District Court for the Central District of California.
The parties will bear their own costs for the litigation, including attorney’s fees, according to documents filed in court.
In a statement Friday, WGA West president David Goodman expressed gratitude for the agreement and characterized it as a victory “owned” by the writers the guild represents.
“I’ve said repeatedly no one wanted the agency campaign over more than me, and I’m very pleased that we’ve achieved our goal: the agencies who represent us now have their financial interests aligned with their writer clients, and the agencies problematic business practices such as packaging fees and agency-owned production entities are at an end,” Goodman said.
A spokesperson for WME did not immediately respond to a request for comment by press time.
WME was the only major agency that had yet to sign a deal with the guild.
Hollywood talent firm Creative Artists Agency signed a franchise agreement with WGA last December that restored its representation privilege and required the firm and its private equity owner TPG Capital to reduce their ownership stake in affiliated production companies to 20%.
For more than a year, WGA has signed franchise agreements with more than 100 other talent agencies, including United Talent Agency, a plaintiff in the federal lawsuit that signed with the union in July.
This past April, U.S. District Court Judge Andre Birotte Jr. tossed the bulk of the guild’s claims that agencies engaged in unlawful price-fixing with studios when securing package deals for writers they represented.
The guild had also accused CAA, WME and UTA of engaging in an illegal group boycott and blacklisting other agencies that agreed to the union’s labor rules, but Birotte dismissed those claims as well.