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WME and CAA Struggle With WGA Over Terms of Surrender on Agency Campaign

Courtesy of Cheyne Gateley and Variety

After more than two and a half years of public jousting and legal jockeying, WME and CAA are ready to capitulate on the battle over the rules for talent agents representing writers. But the WGA isn’t in a rush to declare final victory.

Multiple sources at the industry’s superpower agencies say there is growing frustration that the WGA has been slow to respond to proposals for a final agreement that would allow the agencies to welcome TV and film scribes back into the fold.

The last major hurdle to cutting a deal and scrapping the dueling lawsuits involves each agency’s respective ownership interests in production entities. CAA has a stake in Wiip, headed by former ABC Entertainment chief Paul Lee, while WME parent Endeavor wholly owns the sizable Endeavor Content operation.

Both CAA and WME have offered scenarios for divesting their holdings to the 20% threshold allowed by the guild. Industry sources said WME has quietly begun putting out feelers to prospective buyers for an 80% stake in Endeavor Content, which has a roster of overall deals with producers as well as international distribution agreements on certain properties.

From the WGA’s perspective, there’s no need to rush to help former adversaries who have cost the guild millions of dollars in legal fees to battle federal and state lawsuits filed last year in connection with the WGA’s effort to reform the union’s rules for talent agents who rep scribes.

The changes were designed to attack conflict-of-interest concerns that have gnawed on writers for decades. The rules that sparked litigation include a ban on the long-standing industry practice of agents receiving packaging fees for assembling TV shows and independent films. Agencies are also barred from having sizable ownership stakes in production banners.

A source close to the WGA said the expectation is that WME and CAA would articulate plans to divest their holdings on a reasonable timetable as spelled out in similar agreements the guild has reached with UTA, ICM Partners and others. CAA irked guild leaders by announcing on Sept. 14 that it had agreed to adhere to the WGA’s rules without giving them any advance notice.

The view from WME and CAA is that even at the last mile, with surrender in sight, the WGA is dragging its feet. A big factor for both agencies in giving up the fight was the pandemic-stressed industry conditions and the desire to reunite with the writer clients who formally left the agency en masse in April 2019 after the guild imposed its new rules.

“After all this time, how is this delay helping writers?” one agency veteran lamented.

“We’re ready to say ‘You won.’ We can’t even find a good way to do that.”

Representatives for WME and CAA declined to comment.

Asked about the timetable for the WGA and the agency heavyweights coming to terms, a guild spokesman said, “The parties are trying, but we’re not close to a deal with WME or CAA.”

Variety's Cynthia Littleton contributed to this post.

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