CAA Follows UTA and WME, Claiming Writers Guild Boycott Violates Antitrust Laws

William Morris Endeavor and United Talent Agency both sued the WGA last week

Last Updated: July 1, 2019 @ 10:31 AM

Creative Arts Agency on Monday followed its fellow major talent agencies UTA and WME, filing a lawsuit against the Writers Guild of America, claiming the labor organization’s boycott is violating antitrust laws.

“The WGA has organized a group boycott and unlawful restraint of trade targeting CAA and other talent agencies,” the talent agency and its lawyers wrote in the lawsuit. “The group boycott is, as the WGA’s leadership has freely acknowledged, a ‘power grab.'”

CAA’s lawsuit goes on to say that the WGA boycott is not ordinary labor union activity and “vastly” exceeds any exemption from the antitrust laws that the WGA may have for its ordinary activities as a labor union. “Here, the WGA is trying to coerce anticompetitive agreements in order to severely restrict competition in markets far beyond anything the WGA might have a lawful labor union or collective-bargaining interest in restraining,” the lawsuit continues.

Last week, both WME and UTA filed their own lawsuits against the WGA, accusing the guild of a similar anti competitive boycott.

CAA is accusing the WGA of violating Section 1 of the Sherman Antitrust Act, which prohibits activities that restrict interstate commerce and competition in the marketplace. Under the act, group boycotts and concerted refusals to deal are deemed illegal, and CAA argues that the WGA’s actions fall into that category.

In March, thousands of WGA members authorized the guild to enforce a new code of conduct. They called on Hollywood agencies to put an end to packaging fees — payments to agencies from studios in exchanging for packaging writers, directors and other talent for a project — in order to represent writer clients. After a final round of talks between the WGA and the Association of Talent Agents fell through, the Code was enforced, leading to over 7,000 WGA members sending in form letters to their agencies announcing they would terminate their representation.

Two weeks later, the WGA announced that it would sue UTA, WME, Creative Artists Agency and ICM Partners. The lawsuit argued that since they are a payment from an employer to a representative of an employee, packaging fees are a violation of federal and state labor laws by breaking agents’ fiduciary duty to their clients.

The guild on Friday sent a cease and desist letter to the Association of Talent Agents, which represents the major agencies, claiming that the organization and its member agencies have engaged in “collusive actions” and “anticompetitive behavior.”

The WGA has accused the agencies of price fixing, collusively deciding how to split packaging fees and of refusing to deal with the WGA except through the ATA, which the guid argues is a trade association and doesn’t have the right to bargain for its  members as a group.

Pamela Chelin contributed to this report.

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