When I get my new copy of Magic magazine, I turn immediately to Jeff McBride's column, which I always find extremely interesting. This month's issue is no exception. In his column, Mr. McBride discusses what a manager can do for the magician, pointing out in essence what a another professional can do for the professional entertainer.
He's absolutely right, of course. In the spirit of "the lawyer who represents himself has a fool for a client" and "the shoemaker's children go barefoot," the magician who tries to do it all herself should realize not just that she cannot know everything but that she should put certain tasks in the hands of those who really do know better than she how to get certain things done. At the crucial time in her career, she should think about hiring a personal manager, a business manger, and/or an agent, when those people are necessary. Mr. McBride doesn't mention, though, and I'm certain it's from a lack of column space, and not because he doesn't know, that when hiring a talent agent, the magician may have to make certain that her agent may need to be licensed by the state. Not all states require that agents be licensed, but some do. These include the states with some of the biggest concentrations of entertainers and entertainment businesses, California and New York. Tennessee, the home of Nashville and its big entertainment community, does not have a talent agent licensing requirement, however.
Why is asking whether one's agent is licensed or not an important question? Well, in states like California that require agents to be licensed, someone who performs work that an agent ordinarily does but who is not licensed as an agent can run into difficulties in a number of ways. Take for example a contract between a personal manager and an artist (say a magician), in which the personal manager acts not just as a manager but also as someone who "procures employment" on occasion for the magician. The contract may specify that the manager receives a percentage not just for his services as manager but also for his services in procuring that employment. Suppose further that at some point in the future he and the magician have a spat and she decides to fire him as her manager and tells him not only that she won't pay him the manager's fee but that she also won't pay him the agent fee either, because, after all, he isn't a licensed agent. (The following discussion pertains only to the agent fee; the failure to pay the manager percentage is another issue).
For many years this particular situation was unclear under the California Talent Agencies Act, because courts didn't really explain what "procuring employment" meant. In a January 2008 case Marathon Entertainment v. Blasi, decided by the California Supreme Court, things got a little clearer.
Prior to Marathon Entertainment v. Blasi, a client whose personal manager did "procure employment," and who then decided that she didn't want to pay the personal manager a percentage that would correspond to an agent's fee might argue that the personal manager wasn't an agent and that either the contract was completely void or that the "agent" part of the contract was void. But in Marathon Entertainment, the Court ruled that 1) personal managers who act like agents are subject to the Talent Agencies Act and that the Labor Commissioner, the agency in charge of talent agents, has the authority to decide 2) the extent to which a personal manager has "procured employment" and whether that means the manager is subject to the Act; if so the part of the contract may be severable from the rest of the contract (which has to do with the manager's duties as manager). But the Labor Commissioner does not have to sever that part of the contract.
Says the Court in Marathon Entertainment:
We note we are not called on to decide, and do not decide, what precisely constitutes “procurement” under the Act. The Act contains no definition, and the Labor Commissioner has struggled over time to better delineate which actions involve mere general assistance to an artist's career and which stray across the line to illicit procurement. Here, however, the Labor Commissioner concluded Marathon had engaged in various instances of procurement, the trial court concluded there was no material dispute that Marathon had done so, and Marathon has not further challenged that conclusion. We thus take it as a given that Marathon has engaged in one or more acts of procurement and that (as the parties also agree) Marathon has no talent agency license to do so.
The Act applies to: "actors and actresses rendering services on the legitimate stage and in the production of motion pictures, radio artists, musical artists, musical organizations, directors of legitimate stage, motion picture and radio productions, musical directors, writers, cinematographers, composers, lyricists, arrangers, models, and other artists and persons rendering professional services in motion picture, theatrical, radio, television and other entertainment enterprises." (§ 1700.4, subd. (b).)
So, inquiring whether states require agents to be licensed, and whether one's own agent is licensed, may seem like a mundane or nitpicky inquiry, but it can save one a lot of headaches in future.
Update: See Mr. Siegel's interesting comment on this post. BTW, I wasn't advocating or critiquing the court's ruling in Marathon. I was just pointing out why a magician might want to check on the status of her agent. Please don't cast nasturiums at me. Thanks.
I spearheaded the suit as the president of Marathon, and let me tell you: the Marathon Court blew it. As they wrote,
“In 1982, the Legislature provisionally amended the Act to impose a one-year statute of limitations, eliminate criminal sanctions for violations of the Act, and establish a “safe harbor” for managers to procure employment if they did so in conjunction with a licensed agent. (Former § 1700.44, as enacted by Stats. 1982, ch. 682, § 3, p. 2815; Entertainment Com. Rep., supra, at pp. 8, 38–39.) It subjected these changes to a sunset provision and established the 10-person California Entertainment Commission (Entertainment Commission), consisting of agents, managers, artists, and the Labor Commissioner, to evaluate the Act and “recommend to the Legislature a model bill.” (Former §§ 1701–1704, added by Stats. 1982, ch. 682, § 6, p. 2816, repealed by its own terms Jan. 1, 1986.)
In 1986, after receiving the Report, the Legislature adopted its recommendations, which included making the 1982 changes permanent and enacting a modest series of other changes. (Stats. 1986, ch. 488, pp. 1804–1808; Entertainment Com. Rep., at pp. 22–34; Sen. Com. on Industrial Relations, Analysis of Assem. Bill No. 3649 (1985–1986 Reg. Sess.) as amended Apr. 15, 1986, p. 5 [bill would implement Entertainment Commission's recommendations ‘in full’].) So the Act has stood, with minor modifications, for the last 20 years.”
Any doubt that the Legislature intended to remove the Commission’s statutory authority to penalize is silenced by examination of the CEC’s 1986 Report. Specifically speaking to whether the temporary removal of the sanctions be reinstated, “The Commission recommends that the criminal sanctions which were removed by AB 997, not be restored to the Act,” basing its decision on their conclusion “that the industry would be best served without the imposition of civil or criminal sanctions of the Act.”
The Report’s discussion explains the Commission’s reasoning for their recommendation for the permanent removal of penalties; that there is… “an inherent inequity–and some question of constitutional due process–in subjecting one to criminal sanctions in violation of a law which is so unclear and ambiguous as to leave reasonable persons in doubt about the meaning of the language or whether a violation has occurred. [¶] ‘Procure employment’ is just such a phrase. While a majority of the Commission believes that there should be no unlicensed activity, … the uncertainty of knowing when such activity may or may not have occurred at pain of criminal punishment has left the personal manager uncertain and highly apprehensive about the permissible parameters of their daily activity.” (Id. at p. 25; bolding added.)
To repeat for clarity: finding that there were clear issues of substantive due process in enforcing penalties for violations that reasonable people where “in doubt” as to “whether a violation had occurred,” the 1982 CA. Entertainment Commission recommended that the conditionally removed penalties for unlicensed procurement be permanently extinguished, and as noted by the Marathon Court, their recommendation was adopted and implemented with the passage of Assembly Bill No. 3649 and the bill remains today devoid of a penalty provision.
The implication of that action is inarguable: once the Act’s penalty statute was taken out of the Act, the Labor Commission’s statutory authority to mete out penalties was likewise removed.
“Elementary notions of fairness enshrined in this Court’s constitutional jurisprudence dictate that a person receive fair notice not only of the conduct that will subject him to punishment but also of the severity of the penalty that a State may impose.” (BMW of America v. Gore (1995) 517 U.S. 559, 574.)
“Engrained in our concept of due process is the requirement of notice. Notice is sometimes essential so that the citizen has the chance to defend charges. Notice is required before property interests are disturbed, before assessments are made, before penalties are assessed.” (Wolff v. Fox (1977) 68 Cal. App. 3d 280 citing Lambert v. California (1957) 355 U.S. 225, 228.)
Trying to assign a penalty without statutory guideposts “is a task outside the bounds of judicial interpretation” and can be solved only by Congressional action. “We could do no more that make speculation law.” (U.S. v. Evans (1948) 333 U.S. 483, 495.)
Evans had been indicted “for concealing and harboring five named aliens in alleged violation of 8. Before trial appellee moved that the indictment be dismissed on the ground that it did not charge a punishable offense. He argued that although the statute provided for two different crimes, one landing or bringing in unauthorized aliens, and the other concealing or harboring such aliens, punishment was prescribed in terms only for the former crime. The District Court accepted this argument and granted the motion to dismiss.” (Id.)
The dilemma: despite all parties’ agreeing that Congress meant to make criminal and to punish acts of concealing and harboring” illegal aliens, trying to penalize without statutory direction “is a task of judicial interpretation” and therefore affirmed the lower court’s determination that no penalty can be meted out: “It is better for Congress, and more in accord with its function, to revise the statute than for us to guess at the revision it would make. That task it can do with precision. We could do no more than make speculation law.” (Id.)
Part of the Evans’ Court’s dilemma was that “the legislative history is neither clear nor greatly helpful in ascertaining which of the possibilities calling for punishment was the one Congress contemplated.”
As noted above, the Talent Agencies Act’s legislative history has no such ambiguities. And far from the CEC’s recommendations taken surreptitiously or over his objections, then-State Labor Commissioner C. Robert Simpson, Jr. was one of the ten members of the CA. Entertainment Commission who recommended that the penalty for unlicensed procurement be permanently extinguished.
Those actions, following Evans, BMW and Lambert, unambiguously left procurement of employment for artists lawful, irrespective of whether the procurer is licensed: if there is no notice of the severity of penalty, there can be no penalty imposed. These legislative actions took away the Commission’s statutory authority to embroil anyone into a controversy, no less mete out punishments or disturb contractual rights. Any Labor Commission precedent that meted out penalties was meted out without consideration of this issue and in fact was an assigned penalty without statutory guidelines, and as such should not be followed.
Posted by: rick siegel | July 08, 2010 at 10:21 PM