Sending Agents to the Principal’s Office: How Talent Agency Packaging and Producing Breach the Fiduciary Duties Agents Owe Their Artist-Clients

Author(s): Smith, Brian T. | Abstract: Talent agents have always been indispensable to writers, actors, and other creative workers in the entertainment industry, providing independent representation to their artist-clients in dealings with sophisticated corporate employers. But following a historical shift in their revenues from commissioning clients to lucrative television packaging fees, the power and profits of the biggest agencies grew exponentially. Revenues from packaging fees allowed these agencies to diversify into other businesses and attracted outside investment by private equity firms leading to further vertical integration. Now, the largest agencies have turned their eye toward a new revenue stream: producing and owning content through agency-affiliate production companies. These innovations have come at the cost of the independent representation agents are supposed to provide their clients. Packaging and producing by talent agencies and their affiliates breach the well-established fiduciary duties agents owe their clients under the law by aligning the agency’s own interests with the interests of its clients’ employers. Outside investment in the agencies only exacerbates these conflicts. These departures from traditional agenting undermine the avowed purpose of the California Talent Agencies Act: to protect vulnerable artists from the conflicted practices of their agents. While these issues are at the heart of the ongoing industry dispute between the Writers Guild of America and the big agencies, their importance should concern all agency clients and their unions. The California Legislature should amend the outdated Talent Agencies Act to enumerate and reaffirm the fiduciary duties talent agents owe their clients under common law and prevent the erosion of legal protections for creative workers in one of the state’s largest and most important industries.