UTA on Wednesday became the first of Hollywood’s four biggest talent agencies to agree to the Writers Guild of America’s demands to roll back fees for packaging film and TV projects. After a year-long standoff that saw guild writers drop their agents, UTA has agreed to phase out the use of these fees within the next two years if the other major agencies agree to do so.
WME, CAA and ICM Partners — which along with UTA account for over 90% of packaging fee deals in the industry — have still not agreed to the union’s terms. The WGA has already signed deals with more than 80 talent agencies for whom packaging fees are less of an issue.
As part of the settlement to resume representing guild writers, UTA pledged to not start an agency-owned studio, a project that CAA and WME have developed in recent years and which the guild views as a conflict of interest. UTA will be allowed to keep its minority stake in Civic Center Media, a production outlet developed with MRC, and will continue to take part in independent film sales with a capped interest.
Representatives for the WGA did not respond to a request for comment.
UTA Co-President Jay Sures, who has been lead negotiator for UTA throughout this process, informed clients and former clients of the settlement. “Today, UTA and the WGA have reached an agreement that resolves the dispute that has separated writers and agents for more than a year,” he wrote in the letter, which was obtained by TheWrap. “In this time of instability and uncertainty in our industry and world, we could not be more pleased to put this issue behind us and for our writer clients and agents to reunite as natural allies and partners.”
In 2019, WGA implemented a new Code of Conduct for agents designed to end practices it has described as conflicts of interest: packaging, where agencies bundle talent and projects together and bring them to studio as a package, for which the agency collects a fee on top of the commission for their clients’ work; and affiliate production, in which a studio partly owned by the agency is involved in a packaged project. Thousands of writers terminated their representation shortly after the code went into effect.
Last year, the WGA sued CAA, UTA and WME over packaging fees, which the suit called illegal. In April, a judge dismissed most of the union’s claims of unlawful racketeering. An antitrust lawsuit by the agencies against the WGA continues, with a trial that could begin next March. But the lawsuit will have to proceed without UTA, as the agency must withdraw from the lawsuit as a condition of the agreement.
Read the full note for Sures below:
Dear UTA Writer Family,
At a time when good news is in demand, we have some.
Today, UTA and the WGA have reached an agreement that resolves the dispute that has separated writers and agents for more than a year. In this time of instability and uncertainty in our industry and world, we could not be more pleased to put this issue behind us and for our writer clients and agents to reunite as natural allies and partners.
Not long ago, UTA reached out to the WGA leadership, as we have done numerous times throughout this dispute, and made another effort to resolve this issue in good faith and through compromise. After many long discussions and significant work by both sides, we’ve successfully found middle ground that sets asides our core differences. The Guild has achieved many of its main goals and UTA has as well. As the world continues to face down a pandemic and our industry remains under unprecedented pressures, we believed our highest priority was to bring writers and agents back together in joint focus on building and enhancing your careers.
To be clear, we did not sign the Guild’s Code of Conduct, which was unacceptable to us from the start. But we were able to find a path forward that works for both UTA and the WGA. The highlights of our agreement include compromises on the issues of packaging, affiliate production, independent film financing and, most important to UTA, the protection of your confidential information.
This agreement continues to protect your confidential contract and financial information, which was critical to us. This is information the Guild had insisted we hand over to them whether you consented or not, and it was a core sticking point. We expressed willingness to provide contract information but only if you do not object. Our agreement is that if you tell us not to provide your contract information to the Guild, we will not do so. Without this, UTA would not have made this agreement.
We have agreed to eliminate the practice of packaging starting two years from now. We did so despite the long history of packaging that has provided immense benefits to writers, actors, directors and other artists. We made this agreement on the condition that this provision takes effect only if the Guild reaches a similar arrangement with one of the other major talent agencies.
UTA will maintain its involvement in our existing production entities, protecting our ability to provide financial terms for you that are stronger and more beneficial than legacy production entities can offer. We have agreed to cap our minority profit participation and not launch any majority-owned production studio, which are steps we did not ever intend to take.
We also mutually agreed to dismiss our respective legal actions. This includes the litigation launched by the WGA leadership against the major agencies in the moments when this dispute began and the defensive lawsuit we filed against the Guild in response.
Our commitments were squarely aimed at delivering what’s needed most right now: returning writers and agents to their natural role as partners, so we can together face a business stirring with historic levels of uncertainty. This is a time to get people back to work and some sense of normalcy. You deserve that.
UTA made its name in its earliest days, in large part, as a literary agency. Today, we are a strong, thriving, global company that advocates powerfully and effectively for writers and all artists. This agreement ensures we can continue to play that role for you. And in this moment when the world so clearly needs to be lifted up by powerful stories, we look forward to rejoining one another.
As we begin again, we do so with hopes that you and your loved ones are safe, healthy, and well.
Brian Welk contributed to this report.