LOS ANGELES (AP) — The Writers Guild of America sued the entertainment industry’s four biggest talent agencies Wednesday in the latest and boldest move in an increasingly bitter and protracted fight between the two sides over the way Hollywood does business.
The lawsuit filed in Los Angeles County Superior Court claims agents’ use of so-called packaging fees is illegal under California law because they pose “numerous conflicts of interest between writers and the agencies serving as their agents.”
Packaging fees mean agents combine elements of a television series, including writers, scripts or actors, and sell them directly to studios as a unit rather than taking commissions from each. It can mean massive payouts for agents from successful shows, sometimes more than those who directly work on them receive.
The practice, common for decades in Hollywood, has brought negotiations to a halt between agents and writers, who say they can no longer tolerate it.
“The packaging fees paid by production companies to the agencies are unrelated to their own clients’ compensation and generate hundreds of millions of dollars in revenue for the agencies each year,” the lawsuit states. “Rather than seeking to maximize how much writers are paid for their work, the agencies seek to maximize the packaging fee they will be paid for a particular project.”
