The Writers Guild of America rejected what WGA West president David A. Goodman called an “outrageous” proposal from the Association of Talent Agents to settle a months-long dispute over agency packaging fees.
In a video posted late Wednesday on the guild’s website, Goodman said that the guild will initiate negotiations with the top nine agencies — WME, CAA, UTA, ICM Partners, Paradigm, Gersh, APA, Rothman Brecher and Kaplan Stahler — to seek a settlement to a standoff that has seen more than 7,000 guild members fire their agents.
While the guild did not immediately reject the concept of revenue sharing proposed by the ATA, Goodman said that WGA negotiators decided to take the option off the table and said the ATA’s June 7 proposal took a step “backwards” in its position on agency-owned production companies.
The guild has argued that agents should focus solely on representing writers and other talent to negotiate the best fees for their clients, collecting a percentage of that income, and that agency-owned production companies create conflicts of interest since producers aim to hold down talent costs.
Goodman specifically cited the recently announced IPO by WME parent company Endeavor as a reason for what he felt was a less generous counteroffer from the ATA compared to previous offers.
“Because of the WME IPO, it is now the position of the agencies that they have no relation with their production companies, but they’re willing to help us make an appointment. I’m not kidding. This was said in the meeting,” Goodman said.
“I’ll probably be accused of some for a negative tone here. But this dishonest characterization was simply an insult to all the writers in the room and all the writers in the guild. It was simply outrageous. Revenue-sharing does nothing to incentivize your agency to get you a penny more in salary.”
A representative for ATA did not immediately reply to TheWrap for request for comment.
Goodman laid out several examples and analogies for why he said revenue sharing makes no sense, arguing that there are too many unknowns in regards to the nature of profits on future productions in a changing industry, and that it would create untold administrative headaches to manage. But he also emphasized the guild’s belief that the idea does not address its main concern over conflicts of interest and said revenue sharing is in fact “contrary to these goals.”
“Revenue sharing flips our relationship with our agents on our heads. Now somehow when they make more, we make more,” Goodman said. “We always joked that our agents thought we worked for them. Now they want us to sign an agreement to make that joke a reality. We’re not going to do that.”
Goodman finally said that they intend to hear the individual concerns of the agencies and will agree to meet with any agency willing to meet with them.
“This fight has shown the guild’s strength and sense of purpose,” Goodman said. “This campaign now enters its next phase, where each individual agency alone will have to decide whether to represent writers or justify their existence without them.”
On Wednesday, a judge has granted a request by WME and CAA to designate the Writers Guild of America’s April lawsuit against four top agencies a “complex case,” which will transfer it to a new judge and likely slow down the trial process.
The WGA filed a lawsuit in April against CAA, WME, UTA, and ICM Partners, arguing that their use of packaging fees are a breach of agents’ fiduciary duty to their writer clients by “severing the relationship between writers’ compensation and what the agency receives in fees.”
Lawyers for the WGA also argued that packaging fees violate the Taft-Hartley Act, which states that any representative of an employee cannot receive money from the employer. The agencies have denied wrongdoing.
Watch the full video above.