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Paul Hastings Helps United Talent Agency Secure Deal with the Writers Guild of America Ending Guild/Talent Agency Dispute

August 06, 2020

Century City  Paul Hastings LLP, a leading global law firm, represented United Talent Agency (UTA) in reaching an agreement with the Writers Guild of America (WGA) to end their dueling claims over fee structures, content company affiliations and client confidentiality, paving the way for UTA to resume its representation of writers in the entertainment industry. In the settlement, UTA agreed to drop its antitrust and labor claims against the Writers Guild of America West Inc. and Writers Guild of America East, and the Guilds agreed to drop their counterclaims for, among other things, breach of fiduciary duty, antitrust violations and constructive fraud. Three individual writers, who had also asserted claims against UTA, agreed to dismiss them as well.
The dispute stemmed from the WGA’s decision to prohibit packaging fees, which an agent can receive from a Hollywood studio for packaging a pool of talent needed for a project, as opposed to charging a percentage commission on the earnings it secures for his or her clients. The WGA asserted that the fees create a conflict of interest for the agents, who may prioritize earning a higher payout for themselves than negotiating better rates for the writers, a contention denied by UTA. Thousands of agents of writers were fired as a result of a new code of conduct banning the fees, as well as a rule prohibiting agents from owning or affiliating with production studios.
UTA, along with William Morris Endeavor Entertainment (WME) and Creative Artists Agency (CAA) filed lawsuits alleging that the WGA prompted a group boycott by causing guild members to refuse to work with their agents. The WGA and a group of individual writer plaintiffs countersued the agencies, accusing them of breaches of fiduciary duty, colluding to institute the packaging fee model and other claims.
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