CAA Reels After UTA Defections: What’s Really Behind Mass Exodus

In a week, CAA lost high-ticket actors Chris Pratt, Will Ferrell and Melissa McCarthy – how did it happen?

Last Updated: April 1, 2015 @ 7:51 PM

The mass exodus of agents from CAA to rival UTA this week has left the larger agency in shock despite a Wednesday morning business-as-usual meeting meant to reassure staffers that when the dust settles, CAA will still be CAA.

While the agency may be reeling right now following the stunning defections of 10 agents to crosstown rival UTA, the internal and external message is that CAA is not about to fail. Insiders say that while internally agents are certainly shocked, and while some feel betrayed, they aren’t standing around licking their wounds or even planning retaliation, as has been reported in some places.

At the same time, the blow to CAA’s pride if nothing else has led many to wonder if the long-dominant agency needs to examine its culture. Sources at rival agencies suggested, not surprisingly, that CAA had become arrogant and lazy. One industry veteran told TheWrap the mass exodus may be a blessing in disguise. “It’s good to get a kick in the ass every one in a while. You get complacent, and this forces you to reevaluate your culture.”

Talent agency wars break out from time to time – in recent years more often with William Morris Endeavor than with United Talent Agency – and defections often involve large sums of money.

This case was not different. An individual with knowledge of the situation told TheWrap that the group of senior agents – Jason Heyman, Martin Lesak, Greg Cavic, Nick Nuciforo and Gregory McKnight, a Fab Five of sorts that represented the agency’s star-studded comedy roster for film, TV and touring – first approached the partners after private equity firm TPG took a $225 million stake in the agency last fall. They were looking for significant raises, and rebuffed.

When the Fab Five were swatted down, this promped them to band together and shop themselves as a package, first to WME, then to UTA. The opportunity for to strike a major blow against The Powers That Be at CAA and fortify their own position on the agency food chain ultimately proved too good for UTA to pass on.

Three weeks earlier UTA promoted eight of its own agents to partners. With the influx of former CAA agents, UTA now has nearly 50 partners. That’s roughly the same number as WME, though UTA isn’t nearly as large an agency.

Hours after the Fab Five prompted a scene out of “Jerry Maguire,” they were joined at UTA by former CAA agents Susie Fox, John Sacks and Joanna Scott. As assistants continued to roll calls into the night, Chelsea McKinnies and Mackenzie Condon finalized their deals to switch sides, bringing the official number of dealmaker defections to 10.

Insiders tell TheWrap that the new UTA partners felt unappreciated at CAA, where millions of dollars in client commissions tend to climb the leadership ladder and make the rich even richer.

Still, Heyman originally worked at UTA. Some speculated that the message to veteran UTA agents might be that you need to leave to a competitor agency in order to make partner.

Internally, CAA agents were sad to see friends and colleagues leave the agency, but morale is still high under the circumstances. While the defecting agents are certainly replaceable, the stars they represented and the salaries they commanded are not.

CAA has already lost rising superstar Chris Pratt as well as Will Ferrell, who not only commands top dollar for starring in studio comedies, but also has a very successful production company with Adam McKay.

Melissa McCarthy was the latest domino to follow on Tuesday, and like Ferrell, she is a major comedy star who is gearing up to for Sony’s “Ghostbusters” reboot.

CAA has already begun pursuing legal recourse, as several of their former agents were under contract. There will no doubt be protest about commissions, with CAA likely to demand a split of some kind for the remainder of an agent’s contract.