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Talent Managers: Arbitration Clauses in Contracts Can Limit California Labor Commission Decisions
© Cheryl Hodgson 2008 | Posted on July 14, 2008
A recent U.S. Supreme Court decision involving the California Talent Agency statute may stem the tide of cases by artists before the California Labor Commissioner seeking to invalidate the terms of agreements with managers and agents. . The U.S. Supreme Court upheld a clause in the contract requiring private arbitration of disputes between the parties. As a result, the Labor Commissioner’s ability to take jurisdiction to invalidate the agreement was negated.
For years, managers have lived in dread of the often one- sided rulings by the Labor Commissioner invalidating agreements with managers on grounds the manager “procured or attempted to procure” employment without a talent agency statute. A mere shred of evidence of attempting to procure employment has often been sufficient to tip the scales in favor of the artist.
I have also used the statute to a client’s advantage. In one such case I believed I achieved the right result for the right reason. This has not always been the outcome for many litigants.
The real life story of the late Billy Rancher demonstrates the serious nature of the employment procurement prohibitions of the statute. Billy Rancher from Portland, Oregon had it all. He landed a major record deal with Arista , after the famed Clive Davis flew to Portland to see him perform. Billy had a huge following for unique style of music dubbed “Boom Chuck Rock.” Sadly, Billy developed cancer, surviving two major operations. After a brave battle for several years, Billy’s dreams were cut short by his untimely death.
A year before his death, Billy was sued in federal court in Los Angeles by his manager from New York who had relocated to Los Angeles. The manager had no experience in the music industry. Billy’s album was recorded but never released. Everyone but the manager was focused upon Billy’s health. The manager filed a lawsuit in the U.S. District Court in Los Angeles seeking $10 million.
I agreed to take the case even though Billy was ill and without funds. After reviewing the entire history of the relationship, we located a letter written by the manager while still living in New York! In this letter, he promised to do his best to obtain bookings for the group. I spent some time analyzing the statute and believed this statement, in the manager’s own words, was sufficient evidence of a violation of the Talent Agency Statute to merit winning the case. We filed a Motion for Summary Judgment and I flew down from Oregon to argue before the federal judge in Los Angeles.
I was a young, relatively inexperienced lawyer. I stayed up all night preparing my argument, certain I would have an opportunity to convince the judge with my eloquent oral presentation. Much to my surprise, upon arriving in court, my local counsel advised me, “Sit down and be quiet.” The Judge had issued a tentative written decision granting my motion. The custom in the California courts, unknown to me at the time, was when winning, “Shut up and sit down. Let the losing party argue his or way out of it.” I did, and he didn’t.
Billy Rancher was an inspiration, not just in his music, but in his will to live, including the words he shared with me shortly before he passed. His story also serves as a reminder for all managers and artists to clearly document their relationships, and navigate the land mines of the California Talent Agent statute.
Copyright 2008 Hodgson Law Group
Technorati Tags: Arbitration, California Labor Commissioner, Entertainment Law, Music Law, Personal Appearance Contracts, Personal Managers, talent agent
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