Appendix — HA Artists & Associates, Inc. v. Actors' Equity Assn.

IN THE . 266 3. 1980

Supreme Court of the United States

October Term, 1980

No. 80-348

H.A. ARTISTS & ASSOCIATES, INC.; S.T.E. REPRESENTA-

TION LTD.; J. MICHAEL BLOOM, LTD.; DON BUCHWALD

& ASSOCIATES, INC.; MARJE FIELDS, INC.; HENDERSON/

HOGAN AGENCY _INC., OPPENHEIM-CHRISTIE ASSO-

CIATES LTD.; JOEL PITT LTD.; TALENT REPRESENTA-

TIVES INC.; D.M.I. TALENT ASSOCIATES, LTD.; JEAN

THOMAS AGENCY, INC.; BOB WATERS AGENCY, INC.;

JACOBSON-WILDER, INC.; WILLIAM D. CUNNINGHAM &

ASSOCIATES, INC.; TRANUM ROBERTSON & HUGHES,

INC.; MONTY SILVER AGENCY LTD.; BRET ADAMS,

LIMITED; MICHAEL THOMAS AGENCY, INC.; LESTER

LEWIS ASSOCIATES, INC.; LEAVERTON ASSOCIATES

LTD.; JOE JORDAN TALENT AGENCY INC.; RAGLYN-

SHAMSKY, LTD.; ANN WRIGHT REPRESENTATIVES INC.,

Petitioners,

Vv .

ACTORS’ EQUITY ASSOCIATION, an unincorporated association,

and DONALD GRODY,

Respondents.

ON WRIT OF CERTIORARI TO THE UNITED STATES CouRT OF APPEALS

For THE SECOND CIRCUIT

JOINT APPENDIX

CHARLES DONELAN, Esq. JEROME B. Lurie, Esq.

Bowditch & Dewey Cohn, Glickstein, Lurie, Ostrin,

311 Main Street Lubell & Lubell

Worcester, Mass. 01608 1370 Avenue of the Americas

(617) 791-3511 ee eee 10019

12) 757

HowarD BREINDEL, Esq.

Solin & Breindel P.C. Counsel for Respondents

530 Fifth Avenue

New York, New York 10036

(212) 221-3760

Counsel for Petitioners

Petition for Certiorari Filed August 21, 1980

Certiorari Granted November 17, 1980

Chronological List of

Relevant Docket Entries.

Petitioners' Complaint.

Respondents' Amended

Answer.

Stipulated Facts Portion

Of The Joint Pretrial

Order Filed In The

District Court.

Transcript Of Trial Proceedings:

Trial Testimony Of Thelma

Raider.

Trial Testimony Of Howard

Hausman.

Trial Testimony Of Donald

Grody.

Trial Testimony Of Robert

Fishko.

Trial Testimony Of Mary

Louise Britton.

Trial Testimony Of Barbara

Lea. .

Trial Testimony Of Theodore

Bikel.

Trial Testimony Of Guy

Pace.

-i-

30

47

76

123

127

143

147

152

164

av

Trial Stipulations Of

ees « + «ee * «6 eu i178

Transcripts Of Oral Depositions:

Deposition Testimony Of

meaner Petiiio®. + « + « » 2 183

Deposition Testimony Of

ponnieg GEGGy. « » 1» » © 6 8 191

Trial Exhibits:

Petitioners' Exhibit No. 3 -

Letter Dated March 25,

1975. 7 . o 2 . ° * o 7 _ . 195

Petitioners' Exhibit No. 5 -

Minutes Of Meeting Of .

November 25, 1975. . ... -« 206

Petitioners' Exhibit

No. 67 - Letter Dated

meee 2h Beete -@ @ » 6 @°% 207

Petitioners' Exhibit

No. 71 - Letter Dated

GSSeRer 2h. BE le «03 «& 6 e 209

Petitioners' Exhibit

No. 72 - Letter Dated

GOCGROE. Ase BET c sw © oe 245

Respondents' Exhibit K-1l

- Exclusive Management

COMTEGEGs ¢ © +. -+ 2 ess © 248

Respondents’ Exhibit K-2

- Agency Authorization. .. 265

Respondents’ Exhibit Q

- Licensing Contract. .. 279

oiia

Respondents' Exhibit AA

- Excerpts From "The

Revolt Of The Actors".

Opinion Of The District

Court Denying Petitioners'

Motion For A Preliminary

Injunction Dated June 29,

Opinion Of The Court Of

Appeals Affirming The

Denial Of Petitioners'

Motion For A Preliminary

Injunction Dated

November 9,

Opinion Of The District

Court Dismissing

Petitioners' Complaint

Dated October 12,

Opinion Of The Court Of

Appeals Affirming The

Dismissal Of Petitioners'

Complaint.

Page

291

Pet.App.Dl

Pet .App.Cl

Pet .App.Bl

332

CHRONOLOGICAL LIST OF

RELEVANT DOCKET ENTRIES

May 26, 1978 - Petitioners' complaint

filed in the United States District

Court For The Southern District Of

New York.

May 31, 1978 - Petitioners' motion for

a preliinary injunction filed in the

District Court.

22, 1978 - Hearing in the District

Court with respect to petitioners'

motion for a preliminary injunction.

27, 1978 - Respondents' answer filed

in the District Court.

29, 1978 - Order and Opinion of

the District Court denying petit-

ioners' motion for a preliminary in-

junction.

12, 1978 - Petitioners' notice of

appeal to the United States Court Of

Appeals For The Second Circuit from

the Order and Opinion of the Dis-

trict Court denying petitioners'

motion for a preliminary injunction

filed.

November 22, 1978 - Respondents' amended

answer filed.

November 9, 1978 - Order and Opinion

of the Court Of Appeals affirming

the Order and Opinion of the Dis-

trict Court denying petitioners'

motion for a preliminary injunction.

ole

May 24, 1979 - Joint Pre-trial Order

filed in the District Court.

June 21, 25, 26, 28 and August 7

and September 28, 1979 = Trial

of the action in the District Court.

October 24, 1979 - Opinion of the

District Court dismissing petit-

ioners' complaint.

October 29, 1979 - Judgment dismissing

petitioners' complaint.

November 21, 1979 - Petitioners' notice

of appeal from the October 24, 1979

Opinion of the District Court filed.

November 29, 1979 - Petitioners' amended

notice of appeal from the October

29, 1979 Judgment of the District

Court filed.

May 23, 1980 - Opinion of the Court

of Appeals affirming the Opinion of

the District Court dismissing pet-

itioners' complaint.

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

COMPLAINT (78 CIV. 2452 (CBM) )

Plaintiffs, for their complaint, al-

lege as follows:

le This action for injunctive re-

lief arises out of defendants' violations

of Sections 1 and 2 of the Sherman Act (15

U.S.C. §§1 and 2). This Court's juris-

diction over the subject matter of this

action rests on Section 16 of the Clayton

Act (15 U.S.C. §26).

Re Each defendant inhabits, main-

tains an office, transacts business, or

may be found within the Southern District

of New York. The interstate trade and

commerce involved and affected by the

hereinafter-mentioned violations of the

antitrust laws has been and still is

Carried on in part within the Southern

District of New York.

= 3-

DEFINITIONS

3. As used herein the term:

A. "Equity" shall refer to defend-

ant Actors Equity Association;

B. "Member" shall refer to a mem-

ber of Equity;

C. "Actor" shall include actors,

actresses, performers, entertainers, and

anyone else who performs in live legit-

imate theatrical productions “such as

plays and revues;

D. "Theatrical agent" includes any

person or entity engaged in the business

of obtaining employment for actors in

live legitimate theatrical productions

and rendering related services to actors;

E. "Franchised agent" shall mean a

theatrical agent who is franchised by

Equity to perform services for members;

o4-

F. "Nonfranchised agent" shall

mean a theatrical agent who is not fran-

chised by Equity;

G. "Producer" shall include any

person or entity engaged in the business

of producing live legitimate theatrical

productions on Broadway, off Broadway, at

dinner theatres, in summer stock, at in-

dustrial shows and elsewhere.

PARTIES

4. Each plaintiff is a theatrical

agent having a place of business and doing

business in the city, county and state of

New York.

5. At all relevant times, defend-

ant Equity has been an unincorporated as-

sociation, functioning in part as a labor

union on behalf of those of its members

who perform in legitimate theatrical pro-

ductions, with its principal place of

= Sa

business at 1500 Broadway, New York, New

York. Since at least 1940, virtually all

persons who have regularly performed in

legitimate theatrical productions in the

United States have been or become members

of Equity and virtually all producers

have been parties to collective bargain-

ing agreements with Equity. Each plain-

tiff has a substantial number of clients

who are members of Equity and who have

performed in legitimate theatrical pro-

ductions. At present, Equit, ‘has approx-

imately 11,000 members.

6. Defendant Donald Grody has been

and is the Executive Director of Equity.

Upon information and belief, Mr. Grody

resides in the city, state and county of

New York.

CO-CONSPIRATORS

Fe Persons not made defendants

herein have participated as co-conspir-

~~ =

ators with Equity in the offenses alleged

in this complaint and performed acts and

made statements in furtherance of said

offenses. Such co-conspirators include,

but are not limited to:

A. Theatrical Artists Repre-

sentatives Association, Inc.

("TARA"). TARA is, and at all per-

tinent times has been, an assoc-

iation of theatrical agents;

B. All franchised agents;

Sa All favored nonfranchised

agents whom Equity allows to perform

theatrical agency services without

interference;

D. All producers whom Equity

has coerced, threatened or attempted

to coerce or threaten, to refuse to

deal with nonfranchised agents or

who have supplied Equity with the

= Fa

identity of an agent representing a

member:

TRADE AND COMMERCE

8. In the United States, there is

and has been for many years a separate

national market and various regional sub-

markets for legitimate theatrical pro-

ductions. Such productions are performed

in numerous cities throughout the coun-

try. The largest submarket exists in New

York City, where such performances are

presented on and off Broadway. Live thea-

trical performances have also been pre-

sented by summer stock groups, dinner

theatres and have been sponsored by in-

dustrial corporations. Numerous persons

travel over state lines to attend the

foregoing legitimate theatrical pro-

ductions and actors and companies of

actors travel in interstate commerce to

at.

perform in said productions. Plaintiffs

and other theatrical agents obtain em-

ployment for their actor-clients through-

out the United States.

9. From at least 1940 to the pre-

sent, Equity has been a party to collec-

tive bargaining agreements with virtually

all producers in the United States. Since

at least 1960, Equity has entered into

collective bargaining agreements with the

following associations, which represent

producers in the following fields:

Association Field

League of New York

Theatres Broadway productions

League of Off-

Broadway Theatres Off-Broadway productions

Council of Stock Non-resident stock dramati

Theatres productions

Council of Resident Resident stock dramatic

Stock Theatres productions

League of Resident Resident repertory

Theatres theatre productions

~_

American Dinner Dinner theatre

Theatre Institute productions

Musical Theatre Indoor musical

Association productions

Association of Outdocr musical

Civic Musical stock productions

Theatres

10. Equity's collective bargaining

agreements with the above-described asso-

ciations of producers contain provisions,

among others, to the following effect:

A. producers, with limited

exceptions, agree only to employ

actors who are or become members of

Equity;

B. producers agree not to

deal with agents who are not fran-

chised by Equity in these precise or

substantially similar terms:

"The producer has notice

that if the negotiation

for, or the obtaining of,

a contract by the Actor is

through any employment

agent or personal repre-

sentative not holding a

permit from Equity, or one

whose permit is not in

~10=

good standing, he is not

only breaching the rules

of Equity in employing the

Actor under such con-

dition, but is doing so

with the knowledge that

the Actor himself is lia-

ble for suspension or

other disciplinary action

by Equity and that he may

thus be deprived of the

Actor's services in this

company";

The combination of these provisions and

Equity's rules relating to agents and

members endows Equity with the power to

prevent and threaten prevention of, the

performance of a legitimate theatrical

production by a producer.

ll. Theatrical agents have _ func-

tioned and still do function as independ-

ent business entities. They bear sub-

stantial overhead for office space, em-

ployees, telephone services and other

services and the economic risk of loss

arising from the business of providing

agency services to actors. Virtually all

-ll-e

of their revenues are derived from com-

missions in connection with employment

they have obtained from their actor-

clients. No commissions or other re-

muneration are received by the agents for

their many unsuccessful attempts to ob-

tain employment or for their consulting

and related services rendered to actors.

12. The parties through their

aforesaid national and interstate activ-

ities relating to the employment of

actors in legitimate theatrical pro-

ductions are engaged in interstate com-

merce. As such, they are responsible for

a regular, continuous and substantial

flow of invoices, bills, contracts,

monies and people in interstate commerce.

THE ILLEGAL CONDUCT

13. Equity's membership consists of

virtually all persons regularly employed

-12—

in legitimate theatre productions

throughout the United States. Equity

thus has virtually total control over the

labor market for actors in legitimate

theatre productions throughout the United

States.

14. Equity has promulgated internal

rules governing the conduct and dis-

cipline of its members. By virtue of its

control over the labor market for actors

in legitimate theatre productions, Equity

has been able to enforce these rules by

internal disciplinary procedures, which

have in some cases resulted in fines, sus-

pension, censure and expulsion of members

from Equity.

15. Equity's internal rules pro-

hibit members from employing, being ser-

viced by, or paying commissions to non-

franchised agents. Equity's franchise

agreements with agents require the fran-

=13=

chised agents to adhere to Equity's

rules. These rules comprehensively

govern virtually all the terms and con-

ditions pursuant to which a franchised

agent can represent a member, including

the maximum commission chargeable by, and

payable to franchised agents.

16. In 1958, following meetings

with TARA, Equity and TARA entered into a

"sweetheart" agreement which purported to

formulate the terms of a standard form

franchise agreement binding all thea-

trical agents, as well as comprehensive

rules regarding relations between thea-

trical agents and members known = as

"Equity Rules Governing Rule A" or as

"Rule A". By the terems of Equity's

standard form franchise agreement for

theatrical agents, all of the terms of

Rule A were incorporated by reference in-

to the franchise agreement and were made

binding upon the agents.

-14-

17. Rule A contains the following

provisions, among others:

A. only franchised agents may

represent members;

B. members may not be repre-

sented by nonfranchised agents;

Cc. the applications of TARA

members and prior franchised agents

as of June 4, 1958, for Equity fran-

cises will be automatically granted.

Other theatrical agents must pass

Equity's formal application proced-

ures;

D. Equity may waive com-

pliance with its franchising re-

quirements for theatrical agents it

desires to favor and such a waiver

unless otherwise stated is irrevoc-

able;

E. the maximum commission

rates franchised agents may charge

~15-

members, the duties of the agents to

members, and the terms and con-

ditions of contracts between agents

and Equity members;

F. a contract between a fran-

chised agent and a member is valid

only so long as the agent is fran-

chised (thus, if Equity disenfran-

chises an agent, for whatever

reason, or the agent resigns his

franchise, that agent's contracts

with members atuomatically termin-

ate) ;

G. all disputes between: any

franchised agent and Equity; TARA

and Equity; any franchised agent and

an Equity member; must first be sub-

mitted to a joint Equity-TARA com-

mittee for settlement unless’ the

agent objects in writing. In the

event of an objection or if no set-

-16-

telment can be reached there is to be

an arbitration in which Equity as an

ex-offico party represents all

actors and TARA as an ex-officio

party represents all agents. If an

agent objects to representation by

TARA, TARA may nevertheless be re-

presented at the arbitration pro-

ceedings;

H. Equity may invoke discip-

linary proceedings against fran-

chised agents which may result in

franchise revocation or suspension,

fines of up to $5000; and forfeiture

of commissions owed to the agents;

I. franchised agents must pay

initial and annual franchise fees to

Equity;

J. franchised agents may not

deal with producers who are on

Equity's blacklist of producers (eu-

ai F<

phemistically termed "the defaulting

managers list of Equity");

K. franchised agents may not

represent actors who are not or do

not become members.

The provisions of Rule A are supplemented

by: (1) the by-laws of Equity which sub-

ject a member who deals with a nonfran-

chised agent to expulsion from Equity;

(2) the provisions in all collective

bargaining agreements between Equity and

the various producers groups or leagues

referred to above in paragraph 10B.

18. Rule A as enforcecé and main-

tained by Equity has no legitimate labor

objective or purpose and exists primarily

to allow Equity:

A. to discriminate against

plaintiffs and other nonfavored

theatrical agents for the benefit of

franchised agents and nonfranchised

agents favored by Equity;

-18-

B. to totally, absolutely and

arbitrarily regulate and dominate

the manner in which’ theatrical

agents conduct their business, des-

pite the fact that these independant

businesses are not employers of mem-

bers, but rather obtain employment

for them.

19. In 1977, plaintiffs and other

agents determined that they wouie no

longer continue to have the conduct of

their business dominated and regulated by

Equity and TARA. Accordingly, plaintiffs

resigned their franchises in Equity and

those plaintiffs who were members of TARA

resigned from TARA because they could not

in good conscience accept the terms and

proposals for franchising of agents being

negotiated by Equity and TARA.

20. Thereafter, in order to force

nonfranchised agents, including plain-

-19-

tiffs, to become franchised, Equity or-

ganized and engaged in a group boycott by

coercing and threatening producers and

actors to refuse to deal with nonfran-

chised agents. The group boycott has been

perpetrated, in part, by the dissem-

ination of a blacklist dated December 27,

1977 to all producers and by agents of

Equity threatening producers with de-

privation of actors if they deal with a

nonfranchised agent. In the cover letter

accompanying the blacklist, Equity ad-

vised the producers, and sought their

participation in the group boycott, as

follows:

"'The producer has notice if

the negotiations for, or the

obtaining of this contract, by

the Actor is through any enm-

ployment agent or personal re-

presentative not holding a

permit from Equity, or one

whose permit is not in good

standing, he is not_ only

breaching the rules of Equity

in employing the Actor under

such conditions, but is doing

-20-

tiffs and others.

so with the knowledge that the

Actor himself is liable to sus-

pension or other disciplinary

action to Equity and that he

may thus be deprived of the

Actor's services in this com-

pany.'

None of these agents may repre-

sent Actors' Equity members ex-

cept under certain special cir-

cumstances. We urge you,

therefore, to contact the

Equity office if any of the

agents on the attached list are

identified as the agent of re-

cord of any of your employees.

We seek your cooperation in up-

holding your obligation to the

Collective Bargaining Agreement

in this regard." (Emphasis

supplied)

21. In furtherance of the

boycott, Equity has threatened clients of

nonfranchised agents with expulsion from

Equity if they deal with a nonfranchised

agent and has directed these clients to

refuse to pay commissions owed to plain-

the producers to advise Equity of the

identity of each agent of any member that

the producer may employ.

=2leo

Equity also requires

22. Each of the allegations in the

foregoing paragraphs are incorporated by

reference in each of the following claims

as if set forth fully therein.

FIRST CLAIM

23. At all relevant times, = and

since prior to January 6, 1977, defend-

ants and co-conspirators have unreason-

ably restrained trade in the interstate

commerce of the rendering of services by

theatrical agents to actors, in violation

of Section 1 of the Sherman Act, by, among

other things, combining, agreeing and/or

conspiring:

A. to eliminate and destroy the

business of plaintiffs and other

nonfranchised agents who are not

favored by Equity;

-22-

B. to diminish and eliminate com-

petition between (1) plaintiffs and

other nonfranchised agents who are

not favored by Equity and (2) fran-

chised agents and _ nonfranchised

agents favored by Equity;

Cc. to discriminate against plain-

tiffs and other nonfranchised agents

who are not favored by Equity;

D. to fix, stablize and maintain

the maximum commissions theatrical

agents may charge members and to

control the other terms and con-

ditions pursuant to which theatrical

agents render services to members;

E. to eliminate price and non-

price competition between theatrical

agents;

PF. to deprive members of their

free choice of theatrical agents;

~~

G. to deprive producers of their

free choice of theatrical agents and

members;

H. to have Equity threaten to

take, and to take disciplinary mea-

Sures against members, who have en-

tered into contracts or dealt with

plaintiffs and other nonfranchised

agents who are not’ favored by

Equity;

I. to have Equity threaten pro-

ducers with loss of services of its

members if such producers employed

members through plaintiffs and other

nonfranchised agents who are not

favored by Equity.

24. For the purpose of forming and

effectuating the foregoing combinations,

agreements and conspiracies, defendants

co-conspirators have done those

things which, as hereinbefore charged,

~24-

they combined, agreed and consipired to

do.

as, Tae foregoing combinations,

conspiracies and agreements have had the

following effects, among others:

A. competition between (1) plain-

tiffs and other nonfranchised agents

who are not favored by Equity and (2)

franchised agents and nonfranchised

agents favored by Equity, has been

diminished or eliminated;

B. Plaintiffs and other nonfran-

chised agents who are not favored by

Equity have been and are prevented

from rendering services to members

and face elimination from the bus-

iness of rendering services as thea-

trical agents to members;

C. members have been denied the

opportunity to select the theatrical

agents of their choice to represent

=25-

them and have lost employement op-

portunities that would have other-

wise been available to them;

D. producers have been prevented

from using theatrical agents’ and

members of their choice;

E. the maximum commission charged

by theatrical agents have been

fixed, stabilized and maintained as

have the other terms and conditions

pursuant to which theatrical agents

render services to members;

F. producers and members have been

threatened, coerced, and pressured

to refuse to deal with plaintiffs

and other nonfranchised agents who

are not favored by Equity.

26. The restraints of trade alleged

herein are unreasonable and not reason-

ably related to any legitimate labor-

oriented objectives of Equity.

=36=

27. As a direct and proximate re-

sult of the foregoing restraints, plain-

tiffs have been and continue to be irre-

parably injured in their trade or busin-

ess. T

28. Plaintiffs have no adequate

remedy at law.

SECOND CLAIM

29. All of the aforesaid acts and

conduct of defendants and co-conspirators

have constituted and continue to con-

stitute an illegal monopolization, at-

tempt to monopolize and combination and

conspiracy to monopolize the trade and

commerce of the business of procuring em-

ployment for actors in legitimate theatre

productions and the rendering of related

services in interstate commerce, in vio-

lation of Section 2 of the Sherman Act.

=o 2Fan

30. As a direct and proximate re-

sult of the aforesaid illegal acts and

conduct of defendants and co-conspir-

ators, plaintiffs have been irreparably

injured in their business and property.

31. Plaintiffs have no adequate re-

medy at law.

WHEREFORE, plaintiffs seek judgment

against defendants:

A. preliminarily and permanently

enjoining defendants from in any way

interfering with plaintiffs attempt-

ing to or rendering of any services

to any member or any producer, in-

cluding but not limited to, threat-

ening any producer or member with

any disciplinary action.

B. awarding plaintiffs the reason-

able costs and disbursements of this

action, including attorneys' fees;

and

C. granting such other and further

relief as this Court may deem just

and proper.

Dated: New York, New York

May 26, 1978

BOWDITCH & DEWEY

By /S/CHARLES DONELAN

A Member of the Firm

311 Main Street

Worcester, Mass. 01608

(617) 791-3511

Attorneys for Plaintiff

OF COUNSEL:

SOLIN & BREINDEL

530 Fifth Avenue

New York, New York 10036

(212) 221-3760

=29<

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK

[Caption Omitted In Printing]

AMENDED ANSWER

Defendants Actors' Equity Asso-

ciation ("Equity") and Donald Grody

("Grody"), by their attorneys, Cohn,

Glickstein, Lurie, Ostrin & Lubell, for

their Amended Answer in this action state

as follows:

l. Deny each and every allegation

contained in paragraph 1 of the Com-

plaint, except admit that plaintiffs pur-

port to bring this action as an action to

remedy alleged violations of Section l

and 2 of the Sherman Act (15 U.S.C. §§1

and 2) and that plaintiffs purport to in-

voke the jurisdiction of this Court pur-

suant to Section 16 of the Clayton Act (15

U.S.C. §26).

=30-

Be Deny each and every allegation

contained in paragraph 2 except to state

that defendants lack knowledge or infor-

mation sufficient to form a belief as to

those allegations which pertain to plain-

tiffs' residence or location for the

transaction of business within the Sou-

thern District of New York or elsewhere.

Ze Admit that in paragraph 3 of

the Complaint, plaintiffs purport to de-

fine what certain terms, as used in the

Complaint, shall refer to, mean, or in-

clude. ;

4. Deny knowledge or information

sufficient to form a belief as to the al-

legations in paragraph 4 of the Com-

Pplaint, except admit that plaintiffs pur-

port to be theatrical agents having a

Place of business and doing business in

the City, County and State of New York.

oZje

5. Deny each and every allegation

contained in paragraph 5 of the Com-

plaint, and aver that Equity has at all

relevant times been an unincorporated as-

sociation functioning as a labor union on

behalf of its members; that Equity cur-

rently has its principal place of bus-

iness at 1500 Broadway, New York, New

York; that since at least 1940, most per-

sons who have regularly performed in leg-

itimate theatre productions in the United

States have been or become members of

Equity; and that most producers have been

parties to collective bargaining agree-

ments with Equity. Defendants lack know-

ledge or information sufficient to form a

belief as to the allegation that each

plaintiff has a substantial number of

clients who are members of Equity and who

have performed in legitimate theatre pro-

ductions.

6. Deny each and every allegation

contained in paragraph 6 of the Com-

plaint, except admit that Grody resides

in the State of New York, and aver that

Grody is Executive Secretary of Equity

and resides inthe City of New Rochelle, in

the County of Westchester.

Ve Deny each and every allegation

contained in paragraph 7 of the Com-

plaint, except admit that the Theatrical

Artists Representatives Association, Inc.

("TARA") is, and at all pertinent times

has been, an association of theatrical

agents.

8. Deny knowledge or information

sufficient to form a belief as to the al-

legations contained in paragraph 8 of the

Complaint, except admit that legitimate

theatrical performances are presented on

and off Broadway in New York City, and

that live theatrical performances have

=33-

been presented by summer stock groups and

dinner theatres, that some persons travel

over State lines to see legitimate thea-

trical productions, and that some actors

travel over State lines to perform in leg-

itimate theatrical productions.

9. Deny each and every allegation

contained in paragraph 9 of the Complaint

except admit that since at least 1960,

Equity has entered into collective bar-

gaining agreements with all of the asso-

ciations enumerated in paragraph 9.

10. Deny each and every allegation

contained in paragraph 10 of the Com-

plaint except admit that Equity's col-

lective bargaining agreements with the

associations of producers listed in para-

graph 10 of the Complaint require pro-

ducers, with some exceptions, to employ

actors who are or become Equity members

and have contained the language quoted in

=34-

paragraph 10B, and aver that said lan-

guage has never been interpreted or

enforced by Equity to prohibit producers

from dealing with non-franchised agents.

ll. Deny knowledge or information

sufficient to form a belief as to the al-

legations contained in paragraph ll of

the Complaint.

12. Deny knowledge or information

sufficient to form a belief as to the al-

legations contained in paragraph 12 of

the Complaint.

13. Deny each and every allegation

contained in paragraph 13 of the Conm-

plaint, except admit many persons re-

gularly employed in legitimate theatre

productions throughcut the United States

are members of Equity.

14. Deny each and every allegation

contained in paragraph 14 of the Con-

plaint, except aver that Equity, like all

= 35-

labor unions, has rules governing the

conduct of its members, and that Equity

enforces these rules by internal discip-

linary procedures.

15. Deny each and every allegation

contained in paragraph 15 of the Com-

plaint, except admit that Equity has

rules and franchise agreements governing

some of the terms and conditions pursuant

to which a franchised agent can represent

a member, including the maximum commis-

sions chargeable, and that Equity's rules

prohibit members from employing non-fran-

chised agents, and aver that these rules

and franchise agreements were created and

operate to protect Equity members from

exploitation and to prevent their neg-

otiated minimum wages and working con-

ditions from being invaded or destroyed,

and further aver that rules and franchis-

ing agreements pertaining to theatrical

-36-

agents were first promulgated by Equity

in 1928.

16. Deny each and every allegation

contained in paragraph 16 of the Com-

plaint, except admit that Equity pro-

mulgated Rule A in 1958 following dis-

cussions with TARA, and admit that the

terms of Rule A are incorporated by refer-

ence into Equity's standard form fran-

chise agreement for theatrical agents.

17. Deny each and every allegation

contained in paragraph 17 of the Com-

plaint, aver the Rule A contains pro-

visions similar to some of the provisions

alleged in paragraph 17, and refer to Rule

A (attached to Donelan's affidavit in

support of plaintiffs' motion for prelim-

inary injunction) for the precise terms

and provisions thereof.

18. Deny each and every allegation

contained in paragraph 18 of the Com-

plaint.

=37=

19. Deny each and every allegation

contained in paragraph 19 of the Com-

plaint, except admit that plaintiffs re-

signed their Equity franchises in 1977,

and deny knowledge or information suffic-

ient to form a belief as to the plain-

tiffs' motives or intentions for their

resignations.

20. Deny each and every allegation

contained in paragraph 20 of the Com-

plaint except admit that on December 27,

1977, Harriet Slaughter, then Assistant

Executive Secretary of Equity, sent a

letter containing the language quoted in

paragraph 20 of the Complaint to some

managers.

21. Deny each and every allegation

in paragraph 21 of the Complaint, except

admit that Harriet Siaughter sent a let-

ter, dated June 20, 1977, containing

inter alia, an instruction to Equity mem

= 38-

bers to withhold commissions from agents

unless the agent and actor have executed

and filed with Equity an Agency Author-

ization or Exclusive Management Contract,

and admit that the standard Production

Contract which producers are required to

file with Equity contains a place for

identification of the agent of record.

22. Deny each and every allegation

contained in paragraphs 23, 24, 25, 26,

27, 28, 29, 30 and 31 of the Complaint.

AS AND FOR A FIRST

AFFIRMATIVE DEFENSE

23. The Complaint fails to state a

Claim upon which relief may be granted.

AS AND FOR A SECOND

AFFIMATIVE DEFENSE

24. The activities and operations

of theatrical agents, including the com-

-39-

missions charged by them, have had and

continue to have a direct and substantial

effect on the minimum wage scales and

working conditions negotiated by Equity

on behalf of its members.

25. Theatrical agents representing

Equity members are in an economic inter-

relationship with Equity's members af-

fecting Equity's legitimate union inter-

est in the wages and working conditions of

its members.

26. Equity's agency franchising

system was established and is maintained

by Equity to regulate the relationship

between agent and actor, in order to in-

Sure that agents render competent and

ethical representation which does not

undermine the minimum wages and con-

ditions negotiated by Equity.

27. By reason of the foregoing,

Equity's conduct in maintaining its

-40-

agency franchising system is immune from

the federal antitrust laws pursuant to

the labor exemption of §§6 and 20 of the

Clayton Act (15 U.S.C. §17, 29 U.S.C.

&52), and the Norris-LaGuardia Act (29

U.S.C. §§101-115).

AS AND FOR A THIRD

AFFIRMATIVE DEFENSE

28. Repeat and reallege the alleg-

ations contained in paragraphs 24 through

26, inclusive, of this Answer as if set

forth in full herein.

29. Equity's agency franchising re-

gulations and its enforcement thereof are

intimately related to the wages and work-

ing conditions of Equity's members.

30. Equity's agency franchising re-

gulations and its enforcement thereof do

not have a potential for restraining com-

petition in the market alleged in the Com-

o4l-

plaint or any other alleged business mar-

ket in ways that would not follow natur-

ally from elimination of competition over

wages and working conditions.

31. Equity's agency franchising re-

gulations and its enforcement thereof do

not give Equity control over the market

alleged in the Complaint or any other al-

leged market beyond that necessary to

further Equity's legitimate interest in

maintaining the wages and protecting the

working conditions of its members.

32. By reason of the foregoing,

Equity's conduct in maintaining its

agency franchising system is immune from

the antitrust laws pursuant to the non-

statutory labor exemption.

AS AND FOR A FOURTH

AFFIRMATIVE DEFENSE

33. Repeat and realleges the alleg-

ations contained in paragraphs 24 through

~42-

26, and 29 through 31, inclusive, of this

Answer.

34. Equity's franchising system is

based on reasonable and legitimate bus-

iness concerns and, under all the circum-

stances, does not impose an unreasonable

restraint on competition in violation of

the antitrust laws.

AS AND FOR A FIFTH

AFFIRMATIVE DEFENSE

35. Plaintiffs are formerly fran-

chised agents who had notice of and

operated within Equity's franchising sys-

tem for many years and nevertheless re-

frained from commencing this action until

May 26, 1978.

36. By reason of the foregoing,

plaintiffs are barred by laches from the

relief sought in their Complaint.

~-43-

AS AND FOR A SIXTH

AFFIRMATIVE DEFENSE

37. Repeat and reallege the alleg-

ations contained in paragraph 34 of this

Amended Answer as if set forth in full

herein.

38. Plaintiffs were formerly mem-

bers of TARA, which participated fully in

the formulation of Rule A and its revis-

ions.

39. Upon information and belief,

each of the plaintiffs has participated

since the commencement of his/her member-

ship in TARA in the activities and ‘in-

volvement of TARA in connection with the

formulation, revisions, and support of

Rule A.

40. By reason of the foregoing,

plaintiffs are estopped and barred from

complaining of the agency franchising

system embodied in Rule A.

~~

AS AND FOR A SEVENTH

AFFIRMATIVE DEFENSE

41. The conduct complained of in

the Complaint is the subject of unfair

labor practice charges under the National

Labor Relations Act, 29 U.S.C. §§151 et.

seq.

42. By reason of the foregoing, the

exclusive jurisdication of the National

Labor Relations Board pre-empts and bars

the granting of the relief sought in the

Complaint.

AS AND FOR A EIGHTH

AFFIRMATIVE DEFENSE

43. Plaintiffs themselves have com-

bined and conspired to fix the commis-

sions which they charge to Equity mem-

bers, in violation of Section 1 of the

Sherman Act.

44. By reason of the foregoing,

plaintiffs are barred by the doctrine of

unclean hands from the relief sought in

their complaint.

WHEREFORE, defendants demand judg-

ment dismissing the Complaint herein and

for such other and further relief as this

Court deems just and proper, including

the costs and disbrusements of this

action.

Dated: New York, New York

October 19, 1978

Yours, etc.,

COHN, GLICKSTEIN, LURIE,

OSTRIN & LUBELL

Attorneys for Defendants

Office & P.O. Address

1370 Avenue of the Americas

New York, New York 10019

212 (757-4000)

By: /s/Mary K. O'Melveny

A Member of the Firm

o46-

STIPULATED FACTS PORTION

OF THE JOINT PRETRIAL

ORDER FILED IN

THE DISTRICT COURT

The parties Stipulate to the truth

and accuracy of the following facts for

the purposes of this action only. All ob-

jections to admissibility of these facts

are reserved for trial.

| AEA is a labor organization re-

presenting actors in the legitimate

theatre field throughout the United

States. It has approximately 23,000 mem-

bers. Donald Grody is Executive Secre-

tary, the chief executive officer of ABA.

AEA is governed by a Council, consisting

of councillors elected by the membership.

26 AEA is the traditional theatre

actors’ union. Virtually all major New

York producers, and most other major

theatrical producers throughout the

United States, have collective bargaining

agreement with AEA.

|

Ze AEA negotiates collective bar-

gaining agreements with theatrical pro-

ducers, who are the employers of AEA

members. No agent participates in these

negotiations.

4. These collective bargaining

agreements prescribe minimum working con-

ditions and salaries for members of the

bargaining units represented by AEA.

S. Theatrical agents are independ-

ent contractors who, inter alia, nego-

tiate contracts and solicit employment

for their actor-clients.

6. Agents who operate in New York

City are required to be licensed as em-

ployment agencies and regulated by the

Department of Consumer Affairs of New

York City pursuant to Article 1l of the

General Business Law of the State of New

York, which, inter alia, sets the maximum

commissions employment agencies may

-48-

charge and has specific provisions deal-

ing with theatrical agents.

Te Most or all plaintiffs are em-

>loyment agencies licensed by the Depart-

ment of Consumer Affairs of New York City

pursuant to Article 11 of the General Bus-

iness Law.

8. In 1928 AEA unilaterally estab-

lished a licensing system for the regu-

lation of agents.

9. Licensed agents were required,

inter alia, to abide by a schedule of com-

missions established by AEA and to abide

by other rules.

10. Since 1928, AEA members were

required to deal only with agents who were

licensed by AEA and were subject to dis-

cipline by AEA for dealing with agents who

were not licensed.

ll. From 1928 to the present, AEA's

agency regulation system has contained

=~ 490

the same elements referred to in para-

graphs 8, 9 and 10.

12. In the 1950's, the majority of

agents franchised by AEA were members of

TARA, a trade association of agents work-

ing in the legitimate theatre field.

13. Holding an AEA franchise was

condition of membership in TARA.

14. Membership in TARA was not a

condition to obtaining an AEA franchise.

15. Prior to 1958, AEA’ granted

three types of franchises: Personal Re-

presentatives' Permits; Special Repre-

sentatives' Petnite; and Employment Re-

presentatives' Permits. An agent could

apply for one or more permits, and the

minimum terms and conditions of his re-

lationship with his actor/clients, in-

cluding the maximum commission which

could be charged, depended on the per-

mit(s) held as well as type and terms of

-50-

the employment contract negotiated with

the producer.

16. In the 1950's discussions were

held between AEA and TARA for the purpose

of modifying the agency franchising sys-

tem. As a result of the discussions,

agency regulations known as "Rule A," ef-

fective June 4, 1958, were promulgated.

17. AEA required TARA members and

other agents seeking to represent AEA

members to become franchised by AEA, un-

der Rule A.

18. The stated purpose of Rule A

was "to regulate the dealings of its

[AEA's] members with agents and artists’

managers relating to employment and pro-

fessional careers of actors in the leg-

itimate theatre industry." Rule A pro-

vided, inter alia:

A. the maximum commission rates

agents could charge members, the

=Slx

duties of the agents to AEA members,

and the terms and conditions of con-

tracts between agents and AEA mem-

bers. Maximum commission rates,

varied in accordance with the type

of agency contract, the type of em-

ployment contract, and the terms of

the employment contract. Some com-

missions were permitted on minimum

salaries, not exceeding 5% of earn-

ings for the first ten weeks;

B. Only agents franchised by AEA

were permitted to represent its

actor-members;

Cc. the existing permits of the

three types referred to in paragraph

15 were terminated and ae single

franchise substituted;

D. an actor and agent could enter

into one of three types of agency

contracts: the Special Management

-52-

Contract; the Agency Authorization;

and the Exclusive Management Con-

tract. The Exclusive Management

Contract, which had no analogue

prior to Rule A, permitted an actor

to terminate it if the agent did not

obtain for him a specified amount of

employment within specified time

limits;

E. an actor could negotiate with

an agent terms which were more, but

no less, favorable to the actor than

those contained in Rule A;

F. all agency contracts were re-

quired to be in writing with a copy

filed with Equity;

G. a contract not in writing or

properly executed could be voided at

the option of the actor, and the

agent had no right to commission un-

der such voided contract;

=@§ 3=

H. an actor had the right to term-

inate an agency contract where the

persons who were active in the

agency when he signed his agency

contract ceased to be active;

I. limitations on commissions were

not to be avoided or evaded by any

device or arrangement for payment to

the agent of additional compen-

sation;

J. an agent working on behalf of

an employer (e.g., as a casting

director) could not collect commis-

sions from actors the agent placed

while acting on behalf of the em-

ployer;

K. an agent working with a corres-

pondent agent was not permitted to

charge more than a single commis-

sion;

oShe

L. AEA agreed to grant new fran-

chises to TARA members and other

previously franchised agents, under

the terms and conditions of Rule A;

M. applications for franchises by

applicants who were not previously

franchised were required to be ac-

companied by letters of reference

from five AEA members in good stand-

ing. AEA's Council considered re-

commendations of the Agency Commit-

tee and made the final decision with

respect to the granting of a fran-

chise;

N. when AEA refused to grant a

franchise, the applicant had re-

course to arbitration;

O. franchised agents were required

to pay initial and annual franchise

fees to AEA;

-55-

P. agents were required to comply

with certain provisions relating to

ownership and control (e.g., pro-

hibiting producers from owning a

controlling interest in the agent);

Q. franchised agents were pro-

hibited from dealiiy with producers

on the defaulting managers' list of

AEA, i.@. prouccers Or managers whom

AEA contends owe money to actors

from a prior production;

R. AEA could waive compliance of

its franchsing requirements’ for

agents and such a waiver unless

otherwise stated was irrevocable;

S. an attorney who performed ser-

vices for a member of AEA was not

deemed to be an agent unless’ such

services included solicitation of

employment in the legitimate theatre

for the members, or the attorney

~-56=

held himself out as an agent or en-

gaged generally in the business of

an agent;

T . disputes under Rule A between

actor and agent(s), agent and AEA,

Or TARA and AEA were to be resolved

by tri-partite arbitration under the

auspices of the American Arbitration

Association, where settlement at-

tempts failed. Commissions subject

to conflicting claims by two or more

agents were required to be placed in

escrow with AEA pending resolution

of the dispute;

U. Equity could invoke discip-

linary proceedings against agents

which could result in franchise re-

vocation or suspension, assessment

of liquidated damages up to $5,000,

and forfeiture of commissions;

=}

V. Rule A was to remain in force at

least until June 4, 1963, and there-

after until "terminated" by either

TARA or AEA following six months

prior written notice;

Ww. following termination of Rule

A, agency contracts between a for-

merly franchised agent and an actor

were to remain in force and the agent

was to be deemed to be franchised

with respect to such agency con-

tracts only.

19. The relationship between actor

and agent was set out in Rule A and in the

standard form agency contracts issued by

20. AEA's by-laws subject an AEA

member who deals with a non-franchised

agent to discipline including fines, sus-

pension or expulsion from AEA.

77

21. In about 1974, there was a ser-

ies of meetings between TARA, AEA, and The

League of New York Theatres, a trade asso-

ciation representing major New York City

theatrical producers.

22. By letter dated March 25, 1975,

from TARA President Robert Lantz to

Grody, TARA requested discussions for the

purpose of modifying Rule A and specif-

ically, increasing maximum commissions.

23. In or about 1975, TARA and AEA

commenced discussions with respect to

modifications of Rule A.

24. During the discussions’ TARA

gave six months' notice to "terminate"

Rule A. The termination date was extended

several times by mutual consent of TARA

and AEA.

25. During the discussions, AEA

submitted to TARA proposals which would

have increased some commissions collect-

-59-

able by agents, although it did not meet

TARA's demand for 10% "from the first

dollar" - i.e. 10% on all monies earned,

regardless of whether the actor's salary

exceeded minimum.

26. During the discussions, AEA

agreed to TARA's request that as part of

any new agreement, AEA would enforce the

provisions of Rule A prohibiting non-

franchised agents from representing AEA

members and AEA agreed.

27. The discussions were unsuc-

cessful and on January 6, 1977 TARA term-

inated Rule A.

28. As a result, most or all TARA

agents and some other agents were then un-

franchised and were permitted to repre-

sent AEA members only under pre-existing

agency contracts.

29. Many of the plaintiffs were

members of TARA.

-60-

30. Rule A remained in effect for

those agents who agreed to abide by it,

and such agents were permitted to repre-

sent AEA members for all purposes.

31. On or about May 2, 1977, seven

agents, including five who are plaintiffs

herein, filed a lawsuit in the Federal

District Court for the Southern District

of New York, challenging AEA's agency

franchising system under the anti-trust

laws (Hidden, et al. v. Actors' Equity

Association, et al., 77 Civ. 2624,

(J.M.C.)). The complaint in that action

requested a permanent injunction pro-

hibiting AEA from enforcing the agency

franchising system.

32. The lawsuit was initiated and

financed by TARA, which solicited contri-

butions from agents for this purpose.

33. Discussions between AEA _ and

TARA continued while the lawsuit was

pending.

-6l1-

34. The lawsuit was withdrawn with-

out prejudice in or about August, 1977.

35. NATR, is a trade association of

agents who represent actors in the leg-

itimate theatre and other fields. NATR

was in existence prior to August 1977.

36. All plaintiffs herein are NATR

members.

37. By letter dated August 31,

1977, plaintiffs (with the exception of

STE Representation Ltd. which is still a

TARA member) advised AEA that they wished

to be represented by NATR and that they

"had resigned from TARA because they can-

not in good conscience accept the terms

and proposals being negotiated by Equity

and TARA."

38. In or about October 1977, AEA

and TARA agreed to new Equity Agency Re-

gulations and many of the agents who were

franchised prior to January 6, 1977 be-

came refranchised by AEA.

-62-

39. The Equity Agency Regulations,

inter alia, revised the schedule which

regulated the commissions which fran-

chised agents could charge and increased

the franchise fees payable to AEA by

agents.

40. With the exception of H.A.

Artists & Associates, Inc., all or most

plaintiffs have remained unfranchised

since January 6, 1977.

41. Following the January 1977

termination of Rule A by TARA, AEA has

communicated to actors, agents and pro-

ducers concerning the "dispute" over the

agency regulations.

42. In January 1977, AEA notified

actors, agents and producers of TARA's

termination of Rule A,

43. Since January 1977, AEA has ad-

vised its members and producers of dis-

Cipline which could result to its members

from dealing with non-franchised agents.

-63-

44. In letters to producers, AEA

has quoted the following paragraph [2(A) ]

which has appeared for many years in the

printed collective bargaining agreements

between AEA and various producer groups:

"The producer has notice

that if the negotiation

for, or the obtaining of,

this contract by the Actor

is through any employment

agent or personal repre-

sentat've not holding a

permit from Equity, or one

whose permit is not in

good standing, he is not

Only breaching the rules

of Equity in employing the

Actor under such condition

° but is doing so with the

knowledge that the Actor

himself is liable for sus-

pension or other discip-

linary action by Equity

and that he may thus be

deprived of the Actor's

services in this company."

45. By letter of December 27, 1977,

AEA advised producers of the identify of

non-franchised agents and stated:

"None of these agents [on

the enclosed list] may re-

present Actors' Equity

members except under cer-

-64-

tain special circum-

stances. We urge you,

therefore, to contact the

Equity office if any of

the agents on the attached

list are identified as the

agent of record to any of

your employees. We seek

your cooperation in up-

holding your obligation to

the Collective Bargaining

Agreement in this regard."

46. AEA advised its members that

they were not obligated under Rule A to

pay commissions for jobs obtained by

agents with whom they did not have signed

AEA agency contracts.

47. By letter dated June 20, 1977,

AEA advised its members:

"Up until this time Equity

has advised all unsigned

actors they are not ob-

ligated to pay commis-

sions. As of June 15th

you are instructed not to

pay commissions."

48. Prior to the fall of 1977, the

standard from individual employment con-

tracts used under the "Production Con-

tract" (the collective bargaining agree-

-65-

ment covering major Broadway plays) did

not provide for the identification of the

member's agent, if any, although some of

the Union's other standard form employ-

ment contracts had long contained a place

for identification of the agent of re-

cord, if any.

49. In late 1977 AEA issued a re-

vised standard form individual employment

contract for us2® under the Production

Contract. Among other changes, it in-

cluded a place for identification of the

actor's agent of record, if any. By let-

ter dated March 16, 1978, AEA wrote to

producers in connection with the new

forms:

"Dear Producers:

Please be advised

that the new employment

contracts for the Pro-

duction contract are now

available at the Equity

office. We hope you are

-66-

now using these new con-

tract forms.

* * *

May we call your at-

tention to several changes

in regard to these new

contracts:

* * *

(d) A new line has been

added for the agent of re-

cord. In this regard, may

we remind you of your ob-

ligation under Rule 2(A),

Agents, ‘Permit Holding,'

under the Agreement Gov-

erning Employment’ under

the Production Con-

tract..."

50. By letter dated June 27, 1978,

AEA wrote to producers:

",..none of you is obliged

under our contract to in-

Clude the agent's name.

We believe, however, that

the inclusion of the

agent's name is a valuable

piece of information to

appear on the contract,

assists us in implementing

Our Agency Regulations and

forecloses subsequent dis-

putes between actors and

agents. We therefore

earnestly solicit that you

will continue to include

the name of the agent if

@€7=

in fact an agent has re-

presented our member.

Naturally, whether you do

or do not is entirely up

to you."

51. By letter dated June 30, 1978,

AEA wrote to producers:

"As you know, we have a

provision in our Col-

lective Bargaining Agree-

ment, Rule 2(A), =which

deals with Equity's rules

in connection with agents.

As written, the Rule con-

tains certain ambiguities.

I am sure you are aware

that it has never been our

intention, nor have we

ever tried, to impose what

appears to be an oblig-

ation on- producers’ bo

adhere to our Agency Reg-

ulations. Therefore we

propose that Rule 2(A) be

modified to accord with

Our practices and to read

as follows:

The producer has notice

that if the negotiations

for, or the obtaining of

this contract by the Actor

is through ‘any employment

agent or personal repre-

sentative not holding a

permit from Equity, or one

whose permit is not in

good standing, the Actor

is liable to suspension or

-68-

other disciplinary ac-

tion."

52. Upon learning that an AEA mem-

ber has been represented by an agent with

whom the member does not have on file with

AEA an agency authorization or management

contract, AEA has sent the following form

letter to the member, with a copy to the

agent:

"An employment ' contract

has been received by

Actors' Equity which names

the above agent as_ the

agent of record. re is

imperative that you ex-

ecute and file with Equity

an Agency Authorization or

Exclusive Management Con-

tract in order to be va-

lidly represented by a

franchised agent. The or- -

iginal agreement should be

kept by you, a copy should

be filed with Equity at

once, and the third copy

should be filed with the

agent.

Any agent who seeks to re-

present you without sign-

ing the proper contract

could result in discip-

linary action being taken

against you,

-69-

Some agents have refused

to abide by Equity's Rules

and Regulations Gonverning

Agents and are operating

outside out agency rules.

It is important to protect

the principal behind

Eguity's agency franchise

system. Therefore, a pro-

per agency contract must

he in effect in order for

Equity to properly admin-

ister the agency agreement

between actors and

agents."

53. By letter dated March 6, 1979,

AEA advised its members:

"It is an unfortunate fact

of life that since January

6, 1977, the rules con-

cerning the franchising of .

Agents and the represent-

ation of members by duly-

franchised Agents have

been muddied. Following

Our national referendum in

March 1977, the group re-

presenting the largest

number of Equity fran-

chised Agents, Theatrical

Artists' Representatives

Association (TARA), agreed

in October of 1977 to ad-

here to the regulations

promulgated by Equity. It

is understandable that a

period of confusion fol-

lowed, during which time

Equity attempted to

oFQa

Clarify the new rules to

Agents, as well as to our

Own members. The sit-

uation is further com-

plicated by the emergence

of a new group purporting

to represent agents, the

National Association of

Talent Representatives

(NATR). This group com-

menced a civil court ac-

tion in the Federal Dis-

trict Court in May of 1978

in an effort to enjoin

Equity from enforcing its

Agency regulations. That

suit is pending and we

have every reason to be-

lieve that we will pre-

vail.

Unfortunately, our suc-

cessful defense will not

require the 23 NATR Agents

to adhere to our. regu-

lations governing Agents.

That can be accomplished

in only one way, through

Equity members themselves.

If the Equity Agency Reg-

ulations are to be mean-

ingful, if the understand-

ings we have reached with

TARA are to have full

force and effect, and if

all Equity members are to

be bound and protected by

the rules, then we cannot

permit any Equity member

to violate the rules when

it is to his own personal

advantage.

oF de

Consequently, THE EQUITY

COUNCIL HAS RESOLVED THAT,

EFFECTIVE MONDAY, APRIL 2,

1979, EQUITY WILL STRONGLY

ENFORCE ITS RULE THAT MEM-

BERS CANNOT SEEK OR ACCEPT

REPRESENATATION BY NON-

FRANCHISED AGENTS. This

means that you are pro-

hibited from dealing with

non-franchised Agents in

any of the following ways:

1. You may not

sign a contract with a

non-franchised Agent’ or

enter into an oral under-

standing;

2° You may not be

submitted for roles by a

non-franchised Agent;

36 You may not per-

mit a non-franchised Agent

to negotiate a salary or

any other contractual pro-

visions (@.8es billing)

for you;

4. You may not pay

commissions to a non-fran-

chised Agent.

Upon consideration of this

matter, the Council in-

dicated that violators

would be subject to very

substantial fines as well

as possible suspension and

expulsion from the Union.

The Council discussion

~~)

54.

noted that fines in the

vicinity $1000 would not

be inappropriate. This

action has had to be taken

because no other course is

open to the Union."

By Letter dated May 8, 1979 AEA

advised Lee Meredith, an AEA member:

55.

"We are in receipt of in-

formation which indicates

that you are in violation

of the long-standing

Equity Rule prohibiting

members from dealing with

agents who are not fran-

chised by Equity for work

in legitimate theatre. As

you may be aware, our

Agency Franchising system

has been in effect since

1929.

In order to protect our

membership at large, we

are compelled to initiate

disciplinary procedures

against members, like

yourself, who choose to

disregard this rule."

Some franchised agents are

bers of TARA.

56.

Some plaintiffs compete

members of TARA.

ko

mem-

with

57. Plaintiffs have obtained AEA

jobs for AEA members in New York, New Jer-

sey, Pennsylvania, Connecticut, Cali-

fornia and other states.

58. Franchise fees received by AEA

are deposited in its general funds.

59. AFTRA and SAG, unions’ repre-

senting actors in the radio, television,

and screen areas, both regulate talent

agents. Most or all of the plaintiffs are

franchised by both AFTRA and SAG. Many

actors are members of AEA, SAG and AFTRA.

60. AFTRA prohibits commissions on

scale. SAG prohibits commission on scale

unless the membership votes, in local re-

ferendum, to permit it. The New York SAG

local, allows agents to charge commis-

sions on scale.

61. The agents' licensing agreement

which is part of Defendants' Exhibit JX in

American Federation of Musicians v. Car-

oTFéie

roll, 241 F.Supp. 865 (S.D.N.Y.) is ex-

hibit Q to defendants' list of exhibits.

o7S—

TRIAL TESTIMONY OF

THELMA RAIDER IN THE DISTRICT COURT

* * *

{[65]Q Does Talent Representatives have

employees?

A Yes, it has. We have a secretary

and a subagent.

Q And yourself?

A Myself and my partner.

Q How many people who conduct agency

services as such?

A Three.

Q Their names, besides yours?

A Steven Kaplan, my partner, Ruth Leh-

ner, our subagent.

Q Is Talent Representatives -- is your

talent agency, Talent Representa-

tives, licensed by the State of New York?

A It is.

“7

[74]A The thread was lost. However, I

must say that it is the actors that I re-

present and the actresses who have told

me that this is the kind of representa-

tion they want.

As you develop their career, you are

doing more than just getting them a job,

negotiating a contract. You are trying

to develop an ongoing thing with them.

You are trying to create a sense of con-

fidence in that actor. You are trying to

guide him in what is best for him to do

to achieve the career he wants.

You are going to counsel him and you

just cannot break that from one Union

jurisdiction to another. It is -- the

agent becomes a mother, a father, a [75]

confidant, a sister, everything to that

actor, if there is a good relationship

between that agent and that actor.

= |

Q In effectuating this representation

of actors, what exactly do you do, direc-

ting your attention first to the attempt

to find employment, what does an agent

actually do, what actions does he take?

A Well, of course, the first action

upon meeting an actor that wants you to

represent him or you think you would like

to represent, is to try and introduce

him to the people in the industry that

are going to be helpful in furthering his

Career.

We do that -- I do that by numerous

telephone calls by sending out mailings

on that actor, including pictures and

resumes, sometimes tapes.

By arranging for the actor by ap-

pointment to meet casting directors or

producers, or people in the area where

they can give him employment.

I will entertain casting directors

-78-

Or producers or writers and say, "I would

like you to have lunch with me and meet

John Doe."

I will go to dinner with these peop-

le. I will attend for them a lot of off-

Broadway shows, a lot of workshop pro-

ductions, a lot of productions that are

going on in lofts or garages, because if

my actors are appearing [76] there I want

to see them.

If I see them, I want other people

to see them. So it is just a constant

thing. You do whatever it is you have

to do, which is almost take up every

area of the industry where this man or

this woman is going to want to move

ahead and do everything you can to make

it easy for them to move ahead.

* * x

[84] Q What expenses does an agency have,

a talent agency?

= 7FQe

A Well, of course the basic ones, our

representation, our telechone, postage,

messenger service. Those are very large

expenses, and a secretary. If you are a

big agency, I guess you have more than

one, but we have one secretary.

Then you have the expenses of the en-

tertainment which is very necessary in

this field. You have to entertain your

clients because you cannot always have

the kind of conversations they want to

have with you in the office. The phone

is ringing, other clients are walking

in, and if they have a problem and they

want your attention, is it out to dinner

or out to lunch.

Another major expense is the enter-

tainment of the producers and casting dir-

ectors which I have mentioned before. You

must pay for that. It is part of getting

yourself known, it is part of getting

-80-

your clients known.

Then you must go to the showcase pro-

ductions because that is the place you

find new talent, and you must go to the

off-Broadway productions because that is

a place you find new talent.

In addition, of course, you are going

ts go to [85] Broadway productions be-

cause not only may you find a new client

there, but also you will have your own

client appearing in these productions.

And you have the transportation eapenses

and you have the entertainment expenses

of the tickets to these productions be-

cause nobody gives these to you for no-

thing. You have to pay for them.

And I remember when we first went

into business, our first year or I think

it was our second year, for some reason,

we were lucky enough to get a number of

our clients into Broadway productions.

a@i<

But it was a bad year on Broadway. It

seemed anything we got our clients in and

they are primarily scale performers, be-

Cause we're not a big agency. Elizabeth

Taylor and Richard Burton do not need

talent representatives.

So we would have these performers in

these productions, they would go through

rehearsal period, the show would open,

we would buy tickets, we would send a

telegram to an actor, we would send

flowers to an actress on opening night,

we would meet them after the show, take

them out for a drink or a dinner and the

show would close the next week or the

second week and one day I was very happy

because a client I liked a great deal

got her first break and was going into

a show and I said to my partner, Steve,

[86] "Steve, so-and-so is going into the

show," and he said to me, "One more

a@2e-

Broadway show and we're bankrupt."

Q All these things that you have told

us about that you pay for, what income,

how do you get your income as a talent

agent?

A Commissions.

Q Just exactly what is a commission?

A A commission is a percentage of the

Salary that we negotiate for the actor.

And that commission is regulated by New

York State law. We can collect up to 10

percent. No more.

* * *

[88]Q Let's talk about commissions, Ms.

Raider. You mentioned that New York State

law has a ten percent limit. Are there

other restrictions that you operated under

when you were franchised by Equity?

A Yes.

Q What were they?

A The major restriction we operated un-

-83<

der when we were franchised by Equity,

was a rule that said we could not collect

commission on minimu.

Q Stop you right there. What is "mini-

mum" ?

A "Minimum" is the minimum wage a pro-

ducer can pay to an actor ina production.

Q Where is this found?

A That is found in the collective bar-

gaining agreement between the Union and

the producers.

Q an the case of a Broadway production,

who is the producer organization that ne-

gotiates the collective bargaining agree-

ment with Equity?

aA I believe it is the League of New York

Theater Owners.

Q Does that have a minimum scale wage

in it?

A Yes it does.

Q And hew does that affect what you do?

-84-

[89J]A I can under no conditions, nor

can any client of mine, work, have him

work -- I can under no conditions have

any client of mine work for less than

that minimum wage. It is impossible.

Q Why is it impossible?

A Because the rule is made between the

Union and the producer that the producer

cannot pay him any less than that money.

Q What do you call this regulation of

the commission in Equity?

A That is Rule A.

Q Is that a written document?

A Yes, it is.

Q Does it have other provisions which

govern what you, as an agent, may charge

a member of Equity for your services?

A Yes, it does. There are a number of

restrictions. Rule A is a book of re-

strictions on agents.

Q In negotiating for a job for a client

=§5<

who is seeking a job that Equity produces,

what are your objectives?

A My objectives are always to get as

much money as I possibly can for that

actor. I do not negotiate for minimun.

I don't want minimum, which is that bas-

ic salary that the Union and the produc-

ers have evolved.

([90] Number one, the more money I make

for an actor, the more money I make and

that allows me to keep my doors open. But

very often, no matter how hard I try,

especially with a beginning actor or one

who has not achieved any sense of noto-

riety, I cannot get above minimun.

One of the reasons I can't get above

minimum, is that there are so many actors

in New York who are unemployed and who are

anxious to work. That is very true. Pro-

ducers know this.

So my hands are pretty much tied if I

=86=«

have an actor who has no track record.

When I say to the producer, "Well, I

mean, you know, you just can't pay him

$350. We have to have $450 or $500, and

he wonderful and he is this," and the pro-

ducer will say to me, "This is a scale

job. Your actor doesn't want to do it,

there are ten others who will."

And I will say to my actor, "Look,

no matter what I say or no matter how hard

I try, this is a scale job. We can wait

and try to get something better. I think

you are worth more than scale." And I

have put in all the time with the enter-

taining and the messengers and going to

see and counseling him on how to dress or

how to cut his hair and he will say to

me, "I don't care if it is scale, I want

that job." And I say, "Fine." And I

still [91] go in there and I still nego-

tiate for the billing and I still try to

-87-

negotiate the best contract I can for him

and when it is all over, I can collect

nothing.

Q You mentioned "billings."

What did you mean by that?

A "Billing" is where the actor's name

appears on the program and on the house

boards, the size of his name, the type,

whether it is above -- with my clients it

has never been above the title, but how

large it is and all the areas where that

actor's name is going to be shown that

gives him again, standing.

It proves he has been in a Broadway

or off-Broadway production. It is very

important.

Q Is above the title better than below

the title?

A Yes, that is a star. Elizabeth Tay-

lor is above the title.

Q How many actors do you represent right

now who normally are billed above the

-88-

title?

A Normally, none.

Q Are there other things which you ne-

gotiate for?

A Excuse me one second. You said

"normally." I do have, I believe it was,

two actors, but that is because they have

a name and a reputation in television,

not the [92] legitimate theater per se,

but because they were in legitimate thea-

ter productions they were billed above

the title. Sixteen years I thought that

was good.

Q Are there other things that you seek

in your negotiations for an actor from a

producer?

A Oh, well, you seek dressing rooms and

you seek for transportation, and if it is

a production that is out of town, you

know, you question the housing. You seek

out clauses, which is a clause in a con-

-89-

tract that will allow the actor out of a

production should perhaps, sonebody from

Hollywood see him and think he would be

right for a series or a movie.

You are also aware fre» the moment

you get somebody into any kind of produc-

tion that that is not the end of the car-

eer. Your work begins when an actor gets

into a production because that is the

time he is visible. That is the time you

can make other producers come and see him,

other casting directors witness what he

can do. .

It is the time to build him up. It

is the time to move him ahead. It is the

time you do your hardest work.

Q What is this "out clause" that you

mention?

A As I said, it is a clause in the con-

tract that [93] allows your client to be

released in a certain number of weeks'

notice in order to do something else that

-90-

may further his career, or something else

that he very much wants to do, even though

it might not further the career.

* * *

[94]Q What services do you perform when

that show is beginning and your client is

out of town?

A WelJ., hopefully, our services start

while they are still in town, when the

Client has been hired, and usually there

is a rehearsal in New York. And you make

sure each day or your cliente will call you

each day, to let you know how things are

going and to raise any questions that he

might have about what his part was in this

play, et cetera.

[95] You counsel him constantly because

it is a nervous time for a client when he

is just starting out in a show. Then we

have gotten through that time and the cli-

ent goes out of town, and you will get a

call long-distance, collect. And he will

-9l-

ws

tell you that this has gone wrong or that

has gone wrong and what can you do about

it?

So then you again get in touch with

the producer or do all those things you

have to do and he says "When are you com-

ing out to see me?"

And I usually try and say "Well, I

very much want to see you. Do you need

it this week or can you wait until maybe

you come to Chicago?"

Simply because maybe this week I have

a kid graduating from school or something.

And if it can be Chicago, I then fly

out to Chicago and I see the production in

Chicago, and then I fly back.

They may have gone from Chicago to

Atlanta and in Atlanta something has hap-

pened that I have no control over and well

maybe they have replaced another person in

the cast and you get a phone call that

-92-

says, “Honey, I think you should come and

see the show down here. I think it is a

different show and I want you to really

tell me what you think." Or while they

are on the road, any number [96] of things

happen.

But what you are going constantly is

you are in touch with your client. Your

client calls you, your client writes to

you and you must take care of every matt-

er, sometimes even including his apart-

ment. —

I have even been asked to rent an

apartment while a client is on the road

and you do it because he is your client.

Q Who pays for that plane ticket to Chi-

cago and back?

A I do.

Q And who pays for all the phone calls?

A I do.

Q Do you ever hear from anyone other

than the actor when he is on the road?

-93-

- Oh, yes.

Q Who is that?

A We sometimes hear from the producer.

We sometimes hear from the director.

Q Why would you hear from the producer?

What is that problem?

A Well, that can sometimes be there can

be a misunderstanding or something going

on on the stage or during the tryout and

you get a call that says, "I think [97]

you had better talk to your actor because

this and this and this has happened and I

think it would be a very good idea if you

spoke to him.

"But you had better do it if you want

your actor to keep that job."

Very often when you get a call from

the actor and you have to call the produc~

er, you are in a very difficult position

because that may be the very same produc~

er you are negotiating with on another show

or for another client and here you are be-

-94-

coming the heavy.

You are complaining, you are fighting

for your client's rights, and this produc-

er is just two hours from talking to you a~

bout some money on another one of your

clients and if he gets angry enough, you

get this feeling, "Well, who needs to deal

with her? She is nothing but trouble."

Q Again, dealing with Equity, is the

rehearsal pay when the show is out of town

that the actor receives, do you get any

commission on that pay?

A No, we do not.

Q Do you have or have you on occasion,

negotiated out of town expenses for an

actor as part of his contract?

A Yes.

[98] Do you receive commissions on that?

A No, we do not.

Q Has it ever occurred that one of your

actors, one of your clients, is dropped

from a show while it is still out of town?

-95-

A. It has happened.

Q How much he paid you in commission

when he is dropped?

A Nothing.

Q Moving along in the cycle, is there a

time when a show begins to show out of

town when an actor has pay from which you

are able to collect a commission?

A If it is above scale I am able to

collect.

Q Would you explain exactly what you

just said?

A As we went back, if it is a client

whose a new client and is only -- and

only capable of earning scale as his wage

and wants to do that production, even when

the show opens and he is collecting full

salary which is $500, I believe, $35 out

of town now, we are not allowed to collect

any money.

And I think the thing that is so both-

ersome to me, the reason I am here, is

-96-

that $535 or even $350 or $400, is not a

minimum wage. I don't make that money at

all. [99] THE COURT: What is not a minimum

wage?

THE WITNESS: $535 to my mind is not a

minimum wage. Yet that is a minimum wage

to an actor on the road.

THE COURT: He has to get at least

that under the Actors Equity contract you

are saying?

THE WITNESS: Yes.

THE COURT: When he is on the road,

he has to get $535?

THE WITNESS: I believe it is 35.

THE COURT: 535 a week?

THE WITNESS: Yes.

Q And for which under Equity rules, how

much commission comes to you?

A Nothing.

THE COURT: Let me see if I understand

this: That minimum has been set as a re~

sult of negotiation by Actors Equity with

@97J=-

the producers’ group, is that it?

MR. DONELAN: Exactly, your Honor.

THE COURT: Those minimums.

What about the other conditions of em-

ployment, have those also been set, mini-

mum conditions of employment?

MR. DONELAN: Yes, Your Honor. We

have the collective bargaining agreements

in the entire text here as plaintiffs' ex-

hibits, and intend to have these identi-

fied [100] so the Court will have them.

But I think the Court has already in

essence, gotten really all you need out

of them, which is yes, all the terms and

conditions right there in the collective

bargaining agreement, and they have, by

"they," the defendants have agreed in the

stipulated facts, that no actor, no agent,

no producer can diminish the minimums call-

ed for in the collective bargaining agree-

ment.

THE COURT: I am talking about other

-98-

than the salary.

These other minimum conditions have

been negotiated by the union?

MR. DONELAN: I am not sure which min-

imum conditions you are talking about,

your Honor.

THE COURT: That is what I was getting

at. In addition to a minimum salary which

must be paid if you work in New York.

MR. DONELAN: Yes, your Honor.

THE COURT: It is 535 if you are on

the road.

* * *

([127]Q By "call the rule," does that mean

you terminated their relationship with

Equity?

A I suppose on a general basis we term-

inated our relationship with Equity and

at that moment technically we were unfran-

chised, or disenfranchised.

Q Why did you take that decision?

A Well, because it seemed -- it seemed

=99-

the situation was getting worse. I was

being -- I felt -- forced out of business.

I was being asked to work for nothing, and

if I have to work for nothing I really

can't keep my agency going.

Q What do you mean "work for nothing"?

A Well, the rules as they exist say that

I cannot collect a commission on scale en-

ployment and since I don't represent major

stars or that many people that command over

scale, no matter how hard I try to get it,

the bulk of my clients who are beginners,

who are people moving along in their car-

eers, can't command more than scale, so

basically if I wish to work in the Equity

field, and it is important for me to work

in the Equity field if I want to represent

[128] clients totally, I must work for

nothing. I must put in the time and the

effort and the energy, the same amount or

more than would go into somebody who is

recognized, and not get anything in re-

-100-

turn, even when I get them a job.

Q Were there other features of the Rule

A which you objected to when you termi-

nated your franchise in 1977?

A Yes, indeed. Aside from working for .

nothing, there is the one-year limit on

a contract. If you get a new performer

who comes to you for representation, you

are only allowed to sign him or her for

one year.

In that one year you can really start

the career going perhaps, at least you

might make them known, but at the end of

the year they have the right to break that

contract with you and go to another agent.

It may just be at the point where the

career is going to break and you are out.

The one year rule isn't fully a year

rule either. It isn't a one year guaran-

teed, because there is a 90 day clause

under Rule A, and if you don't get a cl-

ient work in 90 days where he is paid he

-101-

has the right to break his contract with

you, too.

Getting him work is literally getting

him work. It doesn't matter how many au-

ditions you've sent him [129] out on or

what promotion you've done or the jobs

he's failed to get, he actually must be

paid. If he's not he can call the 90 day

rule and your client is gone, if he so

desires.

Q Were there any other features of Rule

A to which you objected?

A Well, I object generally to having

an outsider run my business. The union

has a collective bargaining agreement

with the producers that take care of their

actors.

I am employed by the actor. I mean,

I don't work for the union and I don't

work for the actor -- for the producer.

I work for the actor. He comes to me

for his services. He comes to me the way

-102-

he would come to an accountant, the way

he would come to a lawyer or a dentist.

He wants my services. I think he has

that choice.

Yet, it is an outside force that is

telling me how I can deal with that act-

or. It's not a one-to-one decision and

I am not free, as any other businesswoman

in the country is free, to run my busi-

ness as I see fit under the laws of the

country or the state.

Q Mrs. Raider, did you say this at

TARA meeting?

A I sure did.

([130]Q Did there come a time when you

became dissatisfied with the TARA negot-

iators?

A Yes.

Q When was that?

A I would say that was in, what, well,

around 1977 going into '78.

Q Who were these negotiators

-103-

you are discussing?

A The same group that I mentioned be-

fore -- may I go back? I also felt per-

sonally that the TARA negotiating group

was headed by Howard Hausman, who is a

fine man, but Howard Hausman was not speak-

ing for the smaller agents.

Howard Hausman, I believed, was speak-

ing for the large agencies. It's part of

his job, I presume.

When I say that the negotiating team,

after having been told by the mer ership,

the general membership, that we cc.ld no

longer live under these rules, we had to

get commission on scale, we had to make

some headway with this union, Howard would

go and we would hear there were private

meetings and he would always come back and

say, "Well, you can't do this and you can't

do that, you can't do the third thing.”

And I believe that you have to try.

-104-

So I became terribly pessimistic about

my [131] chances of continuing in business

and staying in a group where my views were

not being expressed. I had to get out.

It was a matter of principle.

Q Did others get out at that time?

A Yes, indeed.

Q Who were they?

A They were the smaller agents, some of

the plaintiffs in this lawsuit, plus others.

I really can't tell you how many got

out. I know the ones that are members

of NATR, but I do not know how many others

could not stand it.

+ de *

[133] Q Have you ever heard of a pink

contract?

Of A pink contract is a chorus contract.

Q Was there anything about chorus con-

tracts to which you objected when you were

negotiating or talking about negotiating

with Equity?

-105-

A It is not the chorus contract that

I object to per se. What I object to is

in Equity the pink contract, which appl-

ies to chorus members, does not ordinari-

ly affect me because I don't represent

chorus members. Chorus members tradition-

ally don't have agents because they do not

pay commission and they go from show to

show more or less on their own.

A white contract is a principal con-

tract and a principal contract is one in

which you can negotiate for as much as you

can get above minimum wage.

Very often, if you are lucky, you will

get [134] more than minimum wage for an

actor.

If an actor goes into a production on

a white contract as a principal, Equity

has the right unilaterally, by its own de-

Cision, to say, "Well, now, that person

really is not a principal role. It's

-106-

really a chorus part." And they can uni-

laterally convert the white contract to

the pink contract.

Your actor keeps the negotiated

amount of money. He gets the benefit of

the dollars that you negotiated. He does

not go back to minimum salary but you are

not allowed to collect a commission on a

pink contract.

In one instance -- I'm going to go

back about nine years -- I had a client in

an industrial show, a show, a musical that

was promoting automobiles, and it was tour-

ing.

As I remember -- I don't remember what

the minimum was, but my client was well

above the minimum and he was collecting

$400 a week, which was very good money

in those days.

After the second week that the show was

running, an Equity deputy saw the show and

said my client was not a principal player,

-107-

he was a chorus player. They converted

the contract to the pink contract, and I

had [135] to return the money I had col-

lected the week he had played as a princi-

pal and could not collect any more -- it

was an eight-week tour -- could not coll-

ect another penny on that contract even

though my client continued to receive well

over minimum. That is why I object to the

conversion of pink to white -- white to

pink

[136]Q Mrs. Raider, do you recall exactly

when you resigned from TARA?

A No. Not the exact date.

MR. DONELAN: Plaintiff's Exhibit 67.

Q Let me ask you if that document re-

freshes your recollection, yes or no, as

to when you resigned from TARA?

(Pause. )

A August 31, 1977.

Q August 31, 1977 Talent Representatives,

your agency, resigned from TARA for the

-108-

reasons that you have just stated; is

that correct?

A That's correct.

Q Were there others who resigned at

that time?

A Yes, many others. There is a list

of agents there.

Q After you resigned from TARA, what

happened to your working every day with

Equity members?

A Well, after we resigned from TARA we

started getting letters from Equity tell-

ing us that we were no longer franchised

agents, we could not represent their cl-

ients, please be aware that our clients

would be in violations of the rules, and

so on and so forth.

What happened was, there was a bar-

rage of [137] threats. First, very mild.

But they started to get stronger and

stronger.

We found, after we resigned from TARA,

-109-

that the most horrible thing that happen-

ed was that we were put on a blacklist to

producers. And since the most important

thing we have going for us in this busi-

ness are our reputations and our rapport

with producers, this was an extraordinar-

ily damaging thing. Your name appearing

on a blacklist, be it valid or invalid,

leads people to question, why are you

there, you know, you must have done some-

thing wrong.

Our clients, indeed, were also shaken

because here they have confidence in their

agent and trust, and all of a sudden they

are aware that their agent, whom they have

liked and respected, again, is on a list.

And it is damaging. It is damaging to

your relationship with clients. It is

damaging in the most insidious way, be-

cause there is nothing you can say to a

blacklist, except explain it; which

takes a lot of time. And it's difficult

-110-

to explain something in this situation.

Q These letters that you got, let's make

sure we have the sequence correct on this

record.

Prior to the publication of this black-

list [138] did you receive letters from

Equity concerning your status as a non-

franchised agent?

A As I remember, we did not receive any

letters from Equity until we resigned from

TARA.

Q After you resigned from TARA you re-

ceived these letters that you have been

talking about; is that right?

A Yes. And also copies of letters to

our clients. Not only letters directly

to us, but letters to our clients.

Q Who signed the letters to you, an

agent from Equity?

A I believe it was Harriet Slaughter.

Q Who is Harriet Slaughter?

-lll-

A I don't know her exact title. I think

she was assistant to Don Grody.

Q Were these letters on the Equity

letterhead?

A Yes, they were.

Q Did you see a copy of the blacklist

letter?

A Yes, I did.

Q Was that on the Equity letterhead?

A Yes, it was, as I remember.

* * *

[170]Q You stated on your direct exami-

nation that there were three persons in

your office who act as agents; is that

right?

A Correct

Q How many of them work in the Equity

field?

A I work in the Equity field primarily;

my partner Steve Kaplan has worked in the

Equity field; Ruth Lehner does not.

-112-

Q In 1978 how many jobs did you obtain

for clients in the Equity field, you or

your agency?

A I don't remember.

Q Was it more than three?

A I think possibly more. It might have

been more like five. I'm not sure in "78,

but I would say between three and five.

Q Who were those actors?

A I believe Tony Craig was one actor.

I'm not sure of dates, there was -- Lanie

Norton in Angel.

Q So you did get the job for Lanie Nor-

ton in Angel?

A Yes.

Q Were you paid commissions on it?

[171]A Yes, I was.

Q Did you negotiate over scale or scale

for that role?

A Over scale.

Q How about Tony Craig?

A Well over scale.

-ll3-

[172] Q You said there were approximately

between three and five --

A If I remember the year. Barbara Ro-

dell, possibly Donald May. I am reaily

not sure of the year, Miss Bases.

Q What job did you get for Barbara Ro-

dell?

A She did a production of Two For The

Seesaw at the Fishkill Playhouse, with

Donald May.

Q Did you get those actors over scale?

A Yes, I did. There was also Forrest

Compton in Sleuth, again, Fishkill Play-

house.

Q Did you get him over scale?

A Yes.

Q Turning your attention to 1977,

approximately how many jobs in the legi-

timate theatre field did you obtain for

your clients?

A I don't remember. And I want to state

clearly, some of these jobs may have been

-114-

'77; I'm not good on the years.

Q Was it about the same number as in

1978?

A I have a feeling that probably '77

was more.

Q How about 1976?

A I don't remember.

Q Again, was it more or the same?

[173] A. I don't remember.

Q When was the last time you went to

see a client in a legitimate theatre pro-

dustion on the road, outside of New York?

A The very last time was June or July

of 1978. I believe it was Tony Craig

at the Pocono Playhouse, doing Barefoot

In The Park.

Q When was the time before that?

A Fishkill, New York; four or five

trips to Fishkill for both Two For The

Seesaw and Sleuth.

Q When was that?

A Well, I said I'm not sure. Probably

-115-

Q When was the time before that?

A Oh, I don't remember.

Q Were there any other times in 1977?

A I can't pinpoint the year. I can't

say.

Q Which of your clients have you ne-

gotiated only scale for in the Equity

field?

MR. DONELAN: I wonder if we could

have any kind of time frame on that, your

Honor.

Q When was the last time you negotia-

ted scale for a client in the Equity field?

A Mel Cobb, in Semmelweis, a Kennedy

Center production.

[174]Q When was that? ,

A "78.

Q When was the time before that?

A I can't remember. I know that they

exist, but I can't remember specifically

when and who.

-115a-

Q When was tie last time you went to

Chicago to see a client in a legitimate

theatre production?

A I haven't been to Chicago in years.

Q How about Atlanta?

A I have never been to Atlanta.

* * *

[180] Q Mrs. Raider, you stated that you

have no written agreement between the act-

ors you represent in the legitimate theat-

re field and your agency with respect to

the relationship between the actor and

your agency since you have ceased abiding

by the Equity regulation; is that correct?

A Correct.

Q Are you aware of Article 1l of the

General Business Law of the State of New

York?

A I am aware of it, yes.

Q Have you read it?

A Not thoroughly, no.

-116-

Q When is the last time you read it, even

not thoroughly?

A Not thoroughly, when we were licensed

and received all this information.

Q This was in 1964?

A 1964.

Q Are you aware that the New York General

Business Law requires you to have a con-

tract with or [181] furnish a written

statement to an actor for whom you obtain

work, setting forth, among other things:

the commissions which you charge?

MR. DONELAN: Objection, your Honor.

It calls for a legal conclusion. The sta-

tute is for the Court to decide what it

means.

THE COURT: Let me hear the question,

Mr. Reporter.

(Question read.)

THE COURT: The question is whether

the witness is aware of that?

MS. BASES: Yes, your Honor.

-117-

THE COURT: She can answer that. That

doesn't call fora legal conclusion. Only

ask the witness to tell us whether she is

aware of it.

A Yes, I am aware of it.

Q What have you done to comply with this?

A Well, the terms of the employment are

clearly stated on the contract between

the actor and the producer.

Q What about the terms of the commissions

which you charge?

A The terms of the commissions which I

charge have been discussed with the actor

verbally and a record of the commission is

kept on a card in my file in the [185)

office.

Q Is there anything you give sien leis

at the time you are making your verbal

agreement with him or her which states the

commission you will charge for the employ-

ment you procure for that actor?

-118-

A No, there is not.

Q You stated on direct examination that

after being signed to your agency for one

year which is the maximum allowed by Act-

ors Equity Association under its agency

regulations, clients often will go to one

of the giants; is that correct?

A That is correct.

Q Who are the giants you are referring

to?

A William Morris and ICM.

Q When is the last time you had a client

signed to you for whom you procured work

in the equity field, who has at the termi-

nation of an exclusive management contract

between you and that client, gone to ICM

or William Morris?

A I have not had an exclusive management

contract with Barbara Rodell. We have had

an exclusive agreement, again, a shake-hands

agreement, for almost 14 years. On the

-119-

basis of that agreement, at one point she

decided to try another agent; did for a

[183] year, and came back. And in Decem-

ber of 1978 went and signed with William

Morris.

Q So this was not a one-year relation-

ship you had with Barbara Rodell, it was a

14-year relationship?

A Yes, it was.

[184]Q And after 14 years she decided to

go to William Morris?

A Yes, and she's also decided to return

to me.

Q Then when is the last time you have

lost a client to William Morris who had

been signed to you and an exclusive basis

for a year and for whom you had obtained

work in the Fquity jurisdiction?

A I think the last one was Dennis Allen,

who appeared in "How To Survive An Election,"

off-Broadway, no commission, 19 -- perhaps

-120-

"68 or '69; again, not certain of the

date. Went to William Morris.

Q I believe you testified on direct ex-

amination that your business, after the

dissemination of what you describe as

the blacklist, fell off, is that right?

A Yes.

Q And the blacklist was disseminated in

-- or what you describe as the blacklist

was disseminated on December 27, 1977,

is that correct?

A If that is the date, yes.

Q Isn't it a fact that in both 1977

and 1978, when the effect of this alleged

blacklist would have had its impact, that

your agency did exactly the same amount of

business in the Equity jurisdiction, name-

ly, one per cent?

A That could be true.

[185]Q Did you not submit one response

to requests for discovery, that figure to

your counsel?

-121-

A I did in deed. That is just the top

of the iceberg, though. I don't know the

business I didn't get because of that black-

list.

MS. BASES: I would ask that that be

struck as nonresponsive, your Honor.

THE COURT: Yes. The question was

"Was that the figure you submitted to

your lawyer?"

Q Was that the figure you submitted to

your lawyer?

A Yes.

-122-

TRIAL TESTIMONY OF

HOWARD HAUSMAN IN THE DISTRICT COURT

* * *

[272] Q Yes.

"- They wanted ten per cent

commission on all engagement procured by

agents through the run of those engage-

ments. It was the main demand."

Was that your testimony?

A I presume so. I mean you are quot-

ing it from --

Q Page 91 of your deposition.

A Fine. If you press me to what I

would consider to be the main economic

demand, I'm sure that's right.

Q I don't mean to press you, Mr. Haus-

man, I'm just asking you for an honest

answer as best you can recall it.

A Really all my answers are honest,

sir, to the best of my recollection.

Q To the best of your recollection, was there a

-123-

main demand made by TARA during the nego-

tiations with Equity?

A It has certainly been the position of

all agents throughout that agents should

get paid for their services. Everyone

in the agency business thinks they ought

to get paid for their services.

There was a period when we were ask-

ing for [273] something more than 10 per

cent but I think in the minds of most of

us at least 10 per cent of whatever the

actor earned would have been a satisfy-

ing solution.

We didn't arrive at that solution.

We have been very happy with the result.

Q And the ten per cent, that covered

scale jobs?

A It would have covered any employment

procured by an agent for an actor, wheth-

er it was for $20,000 a week or for scale.

Q Were there a number of TARA agents

who were particularly concerned about

-124-

getting ten per cent or any commission on

scale jobs?

A I would say all TARA agents were. All

TARA agents were, yes, there were a num-

ber, all.

Q And William Morris itself was in

favor of getting ten per cent across the

board, including scale jobs, is that

correct?

A We were and we are.

Q When TARA terminated Rule A in Jan-

uary of 1977, were virtually all members

of TARA united in their desire to obtain

ten percent across the board?

A I would say all were.

* * *

[281] We all consider that Equity's point

of view was indefensible, outrageous, hor-

rible, wrong, simply because they were ex-

pecting agents to subsidize the lowest

paid actors, somehow to work for them with-

out any way of getting paid.

-125-

We still all feel that way. We

accepted a deal under which that was im-

posed on us. That is the way in which

we accepted it.

Q I believe you testified that you were

unhappy with the final agreement between

TARA and Equity?

A That is what I just said.

Q Specifically, what points are you un-

happy about?

A That's one.

Q When you say "that's one," I'm not:

sure what you mean by that?

A The failure to be able to get commis-

sion, at least 10 percent commission, from

all the earnings of the client that you

place when you place a client, whether

that is at scale or at any rate.

-126-

TRIAL TESTIMONY OF DONALD

GRODY IN THE DISTRICT COURT

* * *

[465]Q Mr. Grody, what was the situation

which led to the formulation by Actors

Equity of its agency regulation system ini-

tially?

A Well, the actor is a very vulner-

able creature in respect of anybody who

either employs him or who assists in get-

ting him employment, and there were no re-

gulations of any kind dealing with the

activities of the middlemen, the agents.

And so before there were any regu-

lations, before Equity began to take action

in the area, agents -- actors were fair

game for agents; there were no restraints

on what commission would be charged; there

were no limitations on the arrangements

that could be made which were inflexible

insofar as the actor was concerned, and

not very favorable to the actor.

-127-

Seeing a necessity for moving in and

getting rid of some of the abuses which

had been practiced on actors, extracting

large sums of money from them, getting

money paid in advance and so on, it be-

came apparent to the governing body of

the union that some arrangement, an ord-

erly arrangement, was necessary in order

to protect the actors in this particular

area.

* * *

[468] THE COURT: I'd like to ask you

a question which might clarify this for

me.

Do the producers deal only with

agents or do they deal with anybody who

might walk up to the door looking for a

part?

THE WITNESS: Obviously a producer

can deal with anybody. There are, how-

ever --

-128-

THE COURT: The question is whe-

ther they do as a matter of practice deal

only with agents.

Do you understand the differ-

ence?

THE WITNESS: Yes.

Well, it's really hard to answer

the question completely, your Honor, be-

cause different producers have different

practices.

I would say mostly producers will

with agents. The nature of the business

requires that they deal with agents. There

are --

THE COURT: That's what I was

getting at, whether the industry as such,

the way it has developed, that as a prac-

tical matter producers seek employees

through agents, or actors and actresses

through agents; is that the way the indus-

try operates?

-129-

THE WITNESS: It does, your

Honor.

* * *

[614] Q Mr. Grody, when an Equity ob-

tains a job with a producer who is a

party to a collective bargaining agree-

ment with Equity, the producer and the

Equity actor into an individual contract:

is that correct?

A Correct.

Q The producer is then required

to pay directly to the actor the agreed

upon wages set forth in that contract?

A Correct.

Q That is true even if the actor

has an agent?

A Not necessarily.

Q Unless the actor consents in

writing to payment to the agent, is the

producer required to pay the actor

directly?

-130-

[636]Q Mr. Grody, are you familiar

with particular kinds of abuses that the

agency regulations were designed to cor-

rect, which have been committed by agents

in the recent past?

* * *

[637] The specific situations that I

can recall have to do with, for example,

an agen*= on the West Coast, Ruth Webb,

who, while she was representing our mem-

bers as an agent, also acted as a packag-

er of a play.

[638] When we found out about that,

we proceeded under the terms of the

agency regulations and ultimately became

involved in an arbitration where it was

resolved that the agent, under the rules,

had no right and, indeed, was prohibited

-l13l-

from collecting agency commissions at a

time when she was acting as a packager

of a play, and the order of the arbitra-

tor required the agent to return to our

members the commissions she had extrac-

ted from then.

That kind of situation has exis-

ted for many years and I expect will con-

tinue to exist, and therefore the prohi-

bition against it is one of the necess-

ary ingredients to any franchising sys-

tem.

Another situation occurred with

an agent here in New York who was requir-

ing our members, her signed clients, to

use the services of a particular photo-

grapher and to require that the head

shots, which is a group of photographs

that are put together, be prepared in a

particular fashion.

When we learned of this we com-

-132-

plained of the activity of the agent and

suggested that if that activity were not

stopped we would have to take away the

franchise, and the agent complied with

our requirement.

Another specific situation occur-

red in the case of Michael Hartik, who was

a franchising agent who [639] tried to

extract -- tried to get our members to

sign agreements which called for a com-

mission of 10 percent from the first

dollar.

When we learned of this, and

had evidence of it, we brought it to the

attention of Mr. Hartik and proceeded

then to revoke his franchise.

At that point he advised us that

he had reconsidered and that he would

abide by the Equity regulations and would

not seek to sign members to a contract re-

quiring a 10 percent commission, and we

restored his franchise.

-133-

There was also a fairly recent

Situation that occurred at the Meadow-

brook Theatre, a dinner theatre in New

Jersey, just across the bridge, where an

agent acted as a casting director for a

particular production at the Meadowbrook

Theatre.

Actually, it was a sub-agent

of the agent who had been franchised, al-

though the sub-agent also gets an Equity

franchise as a sub-agent.

What happened in that situation

was the casting director, the agent,

would not make submissions for that play

-- would not cast anybody unless they

agreed to become aligned with that par-

ticular agency.

So that on the one hand he would

be -- the [640] agent was working for the

employer in being his casting agent, and

at the same time he sought to extract com-

missions from our members for placing them

-134-

in the play.

That is a prohibited activity

under the Equity agency regulations and

we advised the agent of that improper prac-

tice and the agent, having -- I'm not sure

whether he actually took the commissions

and returned them or whether the practice

was stopped immediately, and he said that

he would not try to collect the agency

commissions.

THE COURT: He was a franchised

agent?

THE WITNESS: Yes. If he were

not a franchised agent, your Honor, I

don't know what action we could have tak-

en against him.

THE COURT: You are suggesting

that franchised agents are prohibited

from acting also as producers or agents

of producers in another capacity other

than recruitment? Is that in the regu-

-135-

lations?

THE WITNESS: Yes, yes, your

Honor.

THE COURT: All right. Now I

understand why we are bringing this out.

MS. BASES: Just to clarify

that:

Q Is an agent totally prohibited

from functioning as a casting director

or is he regulated in some way if he

[641] does act as a casting director?

A The prohibition is not total. The

regulation applies only in that instance

when the agent acts as a casting direc-

tor.

For that period of time, or dur-

ing that period when he is in fact in

the employ of the producer, we do not

permit him to extract an agency fee,

since obviously he cannot properly repre-

sent an actor if he is acting for the em-

ployer.

-136-

ical

THE COURT: All right.

Q In connection with this incident,

did the casting director inform the dir-

ector indirectly of the availability of

the actor, if you recall?

A Well, what we have learned is that

anybody who was not -=- who would not agree

to be aligned with that particular agent,

who was acting as a casting director,

would not get a submission and, indeed,

actors who were available for work were

told by the agent acting as a casting

director -- I'm sorry, the agent acting

as a casting director told the producer

or director of the play that certain

actors were not available when in fact

they were.

* * *

[642]Q What does Equity do with the

franchise fees it collects from agents?

* * *

A The money that we collect from

“l3/-

the franchising system is deposited in

general funds.

Q What is it used for?

A It is used for the administra-

tion of the Equity agency regulations.

Q What does the administration of

the Equity agency regulations involve in

terms of salaries and functions and costs

to Equity?

A Here in New York we have one per-

son who is involved full-time in main-

taining the agency files, in responding

to innumerable telephone inquiries from

producers, from agents, irom actors, con-

cerning the status of one or the other.

Producers constantly call up say-

ing, who represents so-and-so actor, or

agents will call up and say, is so-and-so

actor represented. There are constant

[643] inquiries.

There are the usual vrovisions,

-136-

usual requirements of the individual en-

ployment contract coming in with the name

of an agent. That has to be checked again-

st the file to see that there is in fact

an agency contract on file for the member.

The maintenance of all the records

because they are so comprehensive. we have

had to get -- this is in New York City --

a IBM machine called an OS-6, which is a

word processing machine which costs us

$685 a month, on which we are putting all

the agency files, so that we will be able

to provide a better service to producers,

to agents, and to members who make inqui-

ries about actors who have agents.

Then there is, of course, the sal-

ary of the one employee in New York which,

with fringes, is probably around $15,000.

We also have agency functions to

be performed in Chicago, where we have an

office, and in Los Angeles, where we have

-139-

an office. Indeed, the activity in Los

Angeles because of film and television,

is very substantial.

The same kind of work is performed

in those two offices. I would say -- oh,

and in addition, of [644] course, when I

was talking about New York City I talked

about the one employee who was directly

assigned to that problem, yes, the agency

regulations.

In addition, one of my colleagues,

Guy Pace oversees the agency area and I an,

of course, and have been for some time very

much involved in the area.

I would have to say in terms of

our cost to us in running the, administer-

ing the agency rule, the Equity agency re-

gulations, I would think that the cost to

us would have to be somewhere in the neigh-

borhood of forty to fifty thousand dollars

a year.

-140-

Q Do these costs exceed the intake

from the franchise fees?

A By far.

Q Would these costs exceed the in-

take from the franchise fees even if there

were none of the duties associated with the

current agency dispute that had to be done?

A I would say definitely yes.

* * *

[661]Q During the negotiations with TARA,

did TARA question the need for the increa-

sed franchise fees that Equity had reques-

ted?

A No, I don't believe so. I think

we explained [662] that the franchise fees

had remained the same for almost twenty

years, that is, the initial application,

the franchise fee and the annual payment,

and that we thought it was time to have an

increase in the franchise fees. They did

not seriously resist that. My impression

-141-

of the response was, if we can put every-

thing in place, we will agree that there

should be an increase in the franchise

fees.

-142-

TRIAL TESTIMONY OF ROBERT

FISHKO IN THE DISTRICT COURT

* * *

[665]Q Mr. Fishko, what is your occupa-

tion?

A Iam a theatrical manager and

producer.

Q Are you a member of the League

of New York Theatres?

A Yes.

Q How long have you been a member

of the League?

A Since 1968.

Q Approximately how many plays have

you produced or been involved in in the

production of?

A Oh, a couple of hundred.

Q Approximately how many actors have

you hired during the course of your career

as a producer?

A About 1500.

-143-

Q Approximately what percentage of

those acts were hired for principal roles

in your productions through a theatrical

agent?

A Of the number of actors, more

than half were engaged for principal

roles. And of those, I would say 70 or

80 percent were hired through agents.

[666]Q By principal roles, am I correct

in understanding that a non-chorus role

is considered a principal role?

A Yes.

* * *

[667] Q Approximately how much time is

spent with each actor who appears at that

principal interview?

A A minute or two.

Q Is it fair to say that only a

small percentage of actors are generally

asked to come back for a reading?

A A small percentage, yes.

-144-

[668]Q Do you frequently in the course

of your work as a producer receive calls

from agents ahout actors they are submit-

ting for roles?

A Yes, I do.

Q And do you speak to those agents

directly when they call you?

A Frequently.

Q Do you also get calls directly

from actors and actresses?

A Yes, I do.

Q And do you generally speak to

them?

A. Sometimes. Not usually. Gen-

erally if the call is directly from an

actor who I don't know, they are invited

to send a picture and resume in and I will

look at it later.

* * *

[680]Q Have you been asked by agents to

pay an actor more than the minimum or

-145-

scale salary in order that the agent can

obtain a commission?

A Yes.

Q have you done so?

A At times, yes.

* * *

[682]Q So one could have a principal

role even though [683] his part by lay-

man's standards would be a very small

part in the production, is that right?

A Oh, yes. Virtually any speaking

part is a principal role.

Q Any speaking part.

* * *

-~146-

TRIAL TESTIMONY OF MARY

LOUISE BRITTEN IN THE DISTRICT COURT

* * *

[709] Q What is your profession?

A I'm an actress ~- singer.

* * *

[711] Q As a principal performer, do

you need an agent?

A Yes, I do.

Q Why do you need an agent?

A I need an agent to be able to

audition for shows, because otherwise

I couldn't get -- I couldn't be seen by

the directors or producers.

Q Have you tried to see producers

without an agent?

A Yes, I have.

Q Have you ever been successful?

A No.

Q Have you gone to principal in-

terviews?

A I very rarely go, because I

-147-

think it's a waste of time.

Q Why

is it a waste of time?

A So often you see a secretary or

stage manager, and your picture winds up

on a pile of other pictures, and you are

never called.

Q How do you get your work in the

legitimate [712] theatre field?

A I am submitted by an agent for

an audition.

You go and you audition.

Sometimes you have a callback, and you

get the job.

Q Is the principal interview the

same thing as

A No.

one who talks

ence and what

ted in as far

that they are

an audition?

You are just seen by some-

to you as to your experi-

role you might be interes-

as the show is concerned

casting.

Q Do you get a chance to show your

talent at a principal interview?

-~148-

A They do not give you that much

time. It could be anywhere from a minute

to three minutes that they talk to you.

* * *

[715] Q Have any of them represented you

in the legitimate field recently?

Yes.

Who?

Marje Fields.

How did it come about that Marje

on Fr ODO PY

Fields represented you in a legitimate

theatre production? 7

A The end of January I was called

by a Miss Dorothy Scott, who is a sub-

agent in the Marje Fields office.

Q What did she call you for?

A To audition for a show called

Blues In The Night. I had two auditions

and I got the show.

* * *

[715(A)]Q How had you been submitted for

-149-

EO

this show?

A I had been submitted by Miss

Dorothy Scott of Marje Fields Agency.

[716] A TI had been submitted by Miss

Dorothy Scott of Marje Fields Agency.

Q Why?

A I had been submitted because I

was put on a list of people to stay by

the producer, who was Sheldon Epps.

Q Did Miss Scott negotiate your

contract?

A Yes, she did.

What salary did you get?

$250.

Is that over scale?

Yes, it was.

Was that much over scale?

Fr ODO FP OO FP DVD

No, it was not. It was enough

to pay the commission.

* * *

(724] Q Mrs. Britten, when you obtain a

job at Equity, who pays you? How does the

-150-

pay work?

Q

The producer pays me.

In what form? Is that a check?

Can be a check or it can be cash.

Who receives that check?

The talent receives the check.

You get the check?

Right.

And then if there is a commis-

sion, you pay that yourself?

A

If there is a commission, it is

my duty to pay the agent.

* * *

-15l-

‘

*-

TRIAL TESTIMONY OF BARBARA

LEA IN THE DISTRICT COURT

* * *

[749] Q Miss Lea, what is your profes-

sion?

A I'm an actress and singer.

Q Are you a member of Actors

Equity?

A Yes.

Q How long have you been a mem-

ber?

A About 17 or 18 years.

Q Do you work in the legitimate

theatre field?

A Yes, I do.

Q Do you do a lot of work in the

legitimate theatre field?

A Yes. That is my main field of

activity.

Q Have you worked in the legiti-

mate theatre field without an agent?

A Yes.

-152-

Q Have you worked in the legitimate

theatre field [750] with an agent?

A Yes.

Q Are you currently signed on an

exclusive basis with a theatrical agent?

A Yes, I am.

Q How long have you been so sign-

ed?

A Just about three years.

Q Prior to being signed with this

agent, were you signed with any other

theatrical agent?

A No.

Q Did you work with any agents on

a free-lance basis?

A Well, a little bit, when I could

get them to represent me. But I wien

very successful in getting free-lance re-

presentation.

Q How did you try to get free-lance

representation?

-153=

A Well, I sent pictures and re-

sumes; I invited agents to performances

that I would be giving in the New York

area; and in fact, at one time, I believe

it was early in 1976, I took the whole

list of agents and started to go right

down the list geographically to every

single agent's office. I didn't get all

the way through the list because I got in

a good showcase at Equity Library [751]

Theatre and had to stop for rehearsals.

Q When you say you invited agents

to your performances, did anybody request

you to do that?

A Yes. Sometimes on the rare

- occasions when I was successful in get-

ting to see an agent or someone in an

agent's office, often they would say, let

me know when you are doing something in

town.

Q And would you let them know when

you were doing something in town?

-154-

Yes.

Would they come?

I didn't find that they did, no.

on Fr OO PY

How would you know whether they

came or not?

A There would always be a list of

what agents had attended.

Q You state that you have been

signed to an agent for the last three

years?

A Yes.

Q Is that an Equity franchised

agent?

A Yes.

Q Has your relationship with your

agent affected your ability to get work

in the Equity jurisdiction?

A Yes.

Q How has it affected your abili-

ty to get work?

[752] A Well, I have gotten a lot more

-155-

auditions and auditions with a lot better

people, rather, with a lot more important

productions or producing organizations.

Q When you say a lot more auditions,

what kind of auditions have you gotten that

you had not gotten prior to being repre-

sented by an agent?

A Several Broadway auditions, for

the main thing.

Q Had you attended principal in-

terviews? |

A Oh, yes. Yes, by the dozen.

Q Did you ever get an audition from

a principal interview?

A Yes, I did, but for smaller summer

stock companies and dinner theatre occas-

ionally. Not ever for a Broadway, or I

think off-Broadway production.

Q Have you attended principal in-

terviews for Broadway productions?

A Yes, yes.

-156-

Q From the vears 1972 to 1976,

approximately how many principal inter-

views for Broadway productions did you

attend?

A I would say maybe 30. 25 or 30.

It's hard to guess.

Q This is just for Broadway pro-

ductions?

A Just Broadway, yes. It's hard

to separate [753] them in my mine from

non-Broadway. It seemed I was going all

day, every day.

Q Did you get an audition from any

of them?

A No, I didn't.

Q Since you have been represented

by an agent have you gotten any Broadway

auditions?

A Yes, guverai. Probably at least

six, maybe eight or ten.

Q How long is a principal inter-

view?

A Well, you mean how long is each

-157-

individual scene in a principal interview?

Q Can you describe the principal

interview process very briefly?

A Yes. The principal interviews

are set up, I think they are now three days,

but at the time that I was doing them they

were two days. Two eight-hour days. And

I would go very early in the morning, per-

haps two or three hours before the princi-

pal interview started.

Q Why would you do that?

A Because there was such a long

list of people waiting to be seen. There

may be 500 people show up on each day and

people just took to showing up earlier and

earlier to get their name on a list so

that they could then be given a card so

that they could then either wait [754] to

be seen or sometimes there would be three

or four interviews in one day, and you'd

run from one to the other and back and

forth, and, you know, is my number coming

up here yet, or up here.

-158-

Q And when you were seen --

A When you were seen you would have

maybe a couple of minutes.

Q Did you get to perform?

A No. That was one of the bad

things about it.

Q How is an audition different

from a principal interview?

A In an audition you do at least

to some extent perform. I think there is

no similarity, really, because one is just

presenting yourself and one is working with

a script. And working with a script is

totally different. I don't think there

is any way to assess capability from an

interview.

Q Aside from these Broadway audi-

tions which you have gotten with an agent,

which you were unable to get through the

principal interviews without an agent, are

there any other examples you can give of

how an agent has helped you get auditions

-159-

you could not get before having an agent?

A Well, yes. One of the main things

that sticks [755] out in my mind was the

Goodspeed Opera House.

Q What is the Goodspeed Opera House?

A You could call it a summer stock

theatre, although it was about a six-month

season. It's in Connecticut and it's a

theatre where New York agents and producers

very frequently attend the performances.

They produce musicals only, three a season,

and many of their works happen to come to

Broadway. |

It has a kind of reputation as a

Broadway tryout house.

Q Had you tried to get an audition

with the Goodspeed Opera House?

A Yes, I had, for several years.

Q What had you done to try to get

an audition?

A I had sent pictures and resumes

with letters to the producer; I had attend-

-160-

ed principal interviews and had never

gotten an audition out of them.

One year, in fact, I felt that possi-

bly there were some very small roles that

might have been cast out of chorus calls,

and I went to chorus calls and was told

that the roles, however, had previously

been cast.

Q Did the situation change when you

began working with an agent?

A Yes. When I was signed to my

agent, I thought [756] there was something

I was right for, I asked her to submit me,

and I immediately got an audition and got

the part.

Q In your contacts with agents have

any agents engaged in any practices which

you considered unethical or unscrupulous?

A Yes. There was one agent, in the

mid-60's, the only agent at that time that

seemed to be interested in submitting me

for anything, and got me one or two little

-161-

things, or I got one or two little things

through her. And she very, very strongly

hinted that I should pay her more than 10

percent.

And really put quite a lot of

pressure on me to pay her more than 10

percent, which I wound up doing.

* * *

[757] Q Did you pay her more than the

10 per cent?

A Yes, I did.

Q Did you complain to Equity?

A No.

Q Why not?

A

Well, I really was afraid. She

was the only one at that time that was

sending me out on calls, and I just didn't

want to blow that little connection, small

though it was.

Q Has any other agent you have

dealt with engaged in any practices which

you consider unscrupulous or unethical?

-162-

A Well, there were a couple of

attempted [758] "casting couch" episodes.

There was an occasion on which I

think for no legitimate reason I was asked

to return to the agent's office at 1l o'

clock at night.

* * *

And there was another instance of

actual chasing around the office, which

was really -- you are ri:ht to laugh --

it really struck me as ludicrous at the

time. Nevertheless, there it was.

The man was a notorious office

chaser. I don't say that there are many

such, but this was one.

a * a

-163-

TRIAL TESTIMONY OF THEODORE

BIKEL IN THE DISTRICT COURT

* * *

[770] Q Mr. Bikel, what is your occupa-

tion?

A I am an actor.

Q How long have you been an actor?

[771] A Well over thirty years.

* * k

[773] Q Are you familiar with the prin-

cipal interview system?

A Yes, I am.

Q Is the principal interview system

in any way a substitute for having an ag-

ent?

A Oh, no.

The principal interview system was

basically invented by Equity as a device

of furnishing for the actor who is not

represented by an agent some kind of modi-

cum of access to jobs. But the sad fact

of the theatre is that the access to jobs

-~164-

is far better served by the fact of an

agent's representation.

We do force, through the princi-

pal interview system, force a producer to

see everybody whether or not they are re-

presented by agents. But it is at best a

poor substitute.

Q Are theatrical agents necessary

only in New York?

A Oh, no. They may be even more

necessary on the West Coast, because the

cross-over between .the fields of employ-

ment is greater, notably in television and

films.

Q Would you tell the Court briefly

what the [774] purpose of Rule A and the.

franchising system was?

A The purpose of Rule A is to pro-

tect the actor against possible abuse.

Also, incidentally, to protect the agent,

because under Rule A if an actor fails to

fulfill his obligations to the agent, we

-165-

would compel the actor to live up to his

obligations to the agent under the rule.

It stops abuses by, or possible abuses by

the agent, stops possible conflict of in-

terest by an agent, where an agency might

have an interest in an upcoming production

and cast that production with its own cl-

ients and then collects from both ends;

Rule A also protects the actor in the sen-

se that it prevents indefinite or unreas-

onably lengthy ties to an agency, whether

or not the agent does anything for the

actor.

In other words, under Rule A, if

for 90 days the agent did absolutely noth-

ing for the actor, the agent under Rule A

can be dismissed summarily by the actor.

Q Are there any other types of

abuses which Rule A was designed to elimi-

nate?

A Well, Rule A provides for an in-

spection of the agency by Equity, to make

-166-

—

sure that there are regular office hours

# Re, kept, that everybody is being seen,

that no underhanded business goes on. It

prohibits exploitation, or sexploitation,

as it is called these days, in terms of

[775] the casting couch.

And it provides for a system of

arbitration to resolve disputes which other-

wise would have to be litigated.

Q Based upon your thirty-plus years

of experience in the industry and famil-

iarity with the agency franchising systen,

have you come to any conclusions with re-

spect to whether the need for the system

has changed in any way?

A It has not.

Q Does every job obtained by an aoe

or depend upon the expenditure of time and

effort by an agent?

A Actually, it doesn't. An agent

very often is in a sense an order-taker.

-167-

He waits for the phone to ring and when it

does, obviously he will negotiate for the

actor. At times an actor will get his own

job, and then the agent will negotiate a

salary for him. The agent -- well, there

are better agents and worse agents, but it

does not necessarily depend on legwork or

phone work by the agent whether or not the

actor gets the job.

He can get better terms once he

has the job, through the fact that he has

an agent.

Q Are thezve ever situations in which

the agent does virtually nothing and then

Claims a commission?

A Oh, yes, very often. In fact,

when an agent [776] does nothing at all and

yet the actor is still under contract to

the agent and the actor has gotten by some

way -- special contacts, being seen at a

party or being seen in something else,

-168-

through direct contact with a new manage-

ment -- if the actor receives an offer of

a job, then that agent gets the commission

for that job.

Q You mentioned a dispute-resolving

mechanism.

Have you ever been involved in

the operation of that process?

A Yes.

Q Would you tell the Court about

that?

A For my sins they put me on the

American Arbitration Association's panel

as an arbitrator, and I once had cause to

be called as an arbitrator in a case in-

volving an actor and an agent where the

agent claimed: that she made one phone

call-- in fact, the actor was Zero Mostel,

and the agent claimed she made one phone

call which years later led to Zero Mostel

getting the role of Tevye in "Fiddler On

The Roof," and she claimed commissions on

-169-

the entire run.

Q And you participated in resolv-

ing that?

A Yes.

Q In the normal practice in the in-

dustry, is there a certain calculated risk

or gamble involved between the [777] agent

and the actor?

A Well, yes. They gamble on each

other. I guess the agent gambles just as

much. If an agent signs up an actor at the

entry level into the profession, he will

say to himself, I suppose, "I am not so

much out for my 10% of the $150 or $200

that this actor is likely to make tomorr-

ow but I am interested in the $5000 salary

that he may get the day after tomorrow, if

he becomes hot." So it is the look toward

the future that people gamble on.

* * *

[780] Q Based upon your knowledge and ex-

perience in the industry, your familiarity

-170-

with the needs of actos and their rela-

tionships with agents, have you come to any

conclusions regarding what would occur if

the franchising system were eliminated?

* * *

A I think utter chaos would result.

What would happen would be no only that

the abuses and possible abuses would be

laid wide open. Also what I can see is

that the other jurisdictions would suffer.

The other entertainment unions would, in

the wake of the franchising system being

eliminated or destroyed, would have an in-

credible abount of litigative work to do

on behalf of the actors. Because each

time an infraction would happen between

an agent and an actor, the courts would

be swamped with such cases, where at pre-

sent only the arbitration process is be-

ing called into being.

There might be far more exploi-

tation of actors by agents who literally

-171-

work out of a cubbyhole or out of a [781]

telephone booth who hold themselves out

as agents.

Young actors, when they are hun-

gry, grasp at anything. I see a very

bleak future if there were no franchise.

* * *

-172-

TRIAL TESTIMONY OF GUY PACE

IN THE DISTRICT COURT

* * *

[792] Q Where are you employed,

Mr. Pace?

A Actors Equity Association.

* * *

[793] A I am one of three executive

assistants.

Q Do you have any duties in the

agency area?

A I do.

Q What is your duty in the agen-

cy area?

A Generally, when I became in-

volved with the agency ‘dispute earlier

this year, I was involved with matters re-

lating to the problem with the nonfran-

chised agents.

And as I became officially the

esecutive for administration, I replaced

Mr. Randy Phillips as the person in charge

-173-

of the general Gackinme of the agency de-

“partment. |

Q What are your responsibilities in

terms of the general workings of the agen-

Cy area, apart from the dispute between

Equity and the nonfranchised agents?

A Generally the representative

Betty Byrne, who handles that department,

would report to me. I see to it that the

daily workings, the clerical aspects of

that function, are handled correctly,

the filing of contracts, the handling of

routine conflicts, disputes, ehene kinds

of questions.

I am the liaison, the staff per-

son for the agency committee. I would

report to Council, our governing board,

on matters coming from the committee.

In areas where there are questions

| of a policy nature, that wouke be report-

ed directly to me. I would [794] make

those*decisions.

-174-

When there are disputes over wheth-

er a contract is properly terminated, once

it is investigated by Betty, if there is

a question, I would jump in on that.

Q What do you mean, "whether a con-

tract is properly terminated"? What kind

of a contract are you talking about?

A Within the terms of, say, an ex-

Cclusive management authorization. There

are very specific terms as to when an act-

Or or an agent can terminate the contract.

I am thinking particularly of the

90-day clause. :

Q You would resolve any questions

about that? |

A Any questions that would relate

to that, if they were not routine.

Similarly, areas of problems with

commissions. I can recall an agent sent

us a letter saying that one of our members

who was properly signed to him owed some

-175-

commission moneys. We investigated it

and once I determined that the commission

was properly owed, I pursued the member

and effected the proper payment of the

commission.

There are times when I would get

involved with some problems, when a mem-

ber goes back and forth to the Coast; we

used to at one time have a policy where a

member could have a contract on each

Coast.

[795] That has been altered to the ex-

tent that only one contract can exist, but

if a member wishes to use another agent on

the other Coast, we would step in to make

sure that each of the agents are aware of

what is going on and that the permission

is granted.

Q When you say "a contract on each

Coast," are you referring to an exclusive

contract?

A Yes. I am generally referring

-176-

to exclusive contracts. The specific con-

tracts are for a specific show. These are

handled fairly routinely.

Q Does Betty Byrne handle any ques-

tions involving discretion or exercise of

discretion?

A No.

Q What kinds of questions in the

agency area does she handle?

A Very routine. What would be the

commission rate, who are franchised agents,

what are the particular terms of the con-

tracts. In any area of policy, Betty

would not be permitted to get into that.

So, for example, when the members have

been recently calling to ask-- to voice

their concerns about the dispute we have

been engaged in, that would be immediate-

—

ly turned over to myself to handle

-177-

TRIAL STIPULATIONS OF COUN-

SEL IN THE DISTRICT COURT

* * *~

[765] Plaintiffs and defendants agree

as follows:

1) The following 5 of the 23

plaintiffs negotiated no contracts in

Equity's jurisdiction (i.e., the legiti-

mate theatre field) from January 1, 1976

through October 31, 1978:

Tranum, Robertson & Hughes, Inc.

Raglyn-Shamsky, Ltd.

William D. Cunningham Associates,

Inc.

H. A. Artists & Associates, Inc.

Don Buchwald & Associates, Inc.

2) A sixth plaintiff, Joe Jordan

Talent Agency, Inc., derived only 1/10

of one percent of his income in [766]

1976, 1977 and the first half of 1978

from contracts negotiated in Equity's

jurisdiction.

-178-

3) In a questionnaire sent to plain-

tiffs by plaintiffs' counsel pursuant to

interrogatories propounded to plaintiffs

by defendants, all plaintiffs were asked

if they had ever asked any producers not

to identify them as the agent who negoti-

ated the contract for the Equity members.

(a) The following plaintiffs made

such requests to the producers and the

producers complied:

J. Michael Bloom Ltd.

Marje Fields Inc.

Lester Lews Associates, Inc.

Monty Silver Agency, Ltd.

Michael Thomas Agency, Inc.

D.M.I. Talent Associates, Inc.

Oppenheim Christie

STE Representation, Ltd.

(b) The following plaintiffs* did

not make any such requests of producers:

-179-

amen Associates, Ltd.

Talent Representatives

Bob Waters

Ann Wright Representatives

[767] Joe Jordan Talent Agency, Inc.

Tranum, Robertson & Hughes. Inc.

Raylyn-Shamsky, Ltd.

William D. Cunningham Associates,

Inc.

H. A. Artists & Associates, Inc.

Don Buchwald & Associates, Inc.

And there is a footnote to (b),

ycur Honor, which states as follows:

*These include the 5 plaintiffs who

did no business in Equity's jurisdiction

and the plaintiff who did only 1/10 of 1%

of his business in Equity's jurisdiction

in 1976, 1977 and the first half of 1978.

(c) The remainder of the plaintiffs

did not respond to the questionnaire.

4) The following plaintiffs have no

-180-

written contracts with actors for whom

they obtained employment in Equity's

jurisdiction (i.e., in the legitimate

‘theatre field) during the period January

6, 1977 through October 31, 1978 (the |

cut-off date for discovery in this re-

gard) containing the commission or fee

to be charged by the agency to the actor

for whom employment was obtained, and

have no other statements, copies of which

were furnished. to the actor, containing

the terms of employment and commission or

fee to be charged by the agency to the

[768] actor:

Bret Adams, LTD.

Oppenheim-Christie Associates,

Ltd a.

D.M.I. Talent Association

Henders>n Hogan Agency, Inc.

Joe Jordan Talent Agency, Inc.

Leaverton Associates, Ltd.

Lester Lewis Associates, Inc.

-181-

Joel Pitt, Ltd.

Monty Silver Agency, Ltd.

Talent Representatives, Inc.

Jean Thomas Agency, Inc.

Michael Thomas Agency, Inc.

Jacobson-Wilder, Inc.

Ann Wright Representatives, Inc.

Bob Waters Agency, Inc.

J. Michael Bloom, Ltd. has con-

tracts stating the commission to be

charged (10%), with some but not all of

the actors for whom it obtained employ-

ment in Equity's jurisdiction during the

above-stated period.

* * *

-182-

‘ DEPOSITION TESTIMONY OF RANDY

PHILLIPS IN THE DISTRICT COURT

[4] Q

A

Q

A

Q

A

[8] Q

present

A

* * *

Are you a member of Equity?

Yes.

How long have you been a member?

Since 1955.

Continuously?

Yes.

* * *

By Rule A, I am referring to the

regulations.

Present regulations are the Ag-

ency Regulations.

Q

By Agency Regulations, I assume,

we are talking about --

A

Q

That is the new title.

I assume we are talking about the

regulations which govern agents, theatri-

cal agents who perform services for Equi-

ty members?

MS. BASES: Off the record.

-183-

(Whereupon, a discussion was held

off the record.)

Q Do you have any duties with re-

spect to the Agency Regulations?

A Yes.

Q What are your duties?

A Now, that I am on the staff, my

contact with whatever has to go down to

discuss, whatever changes may be made and

any liaison that has to be done with the

representatives of TARA. T-A-R-A, [9]

Theatrical Artist Representatives Associa-

tion, Inc., whatever it is. And more spe-

fically, to try and bring together into a

form of a rule book those agreements that

have been worked out.

Q You are aware that under the Agen-

cy Regulations, an Equity member cannot

deal with a non franchised agent?

A Correct.

Q Do you have any duties with respect

-184-

to that aspect of the Agency Regulations?

A Yes.

Q What are those duties?

A Up to the present, it is sending

out of a letter or seeing to it that

letters are sent out. I don't actually

do the paper work. But as I said, I

have the oversee of everything that hap-

pens. So, therefore, I am not actually

handling the work, but responsible that

it is done.

Q You are responsible for the day-

to-day enforcement of the Agency Regula-

tions?

A That is right.

* * *

[29] Q Were you aware that there was a

time when Equity permitted an agent to

earn a commission on scale jobs?

A Yes.

Q When did that end?

-185-

A When we adopted the agency regula-

tions, the new set of rules.

Q Are you talking now about 1958?

A No, I said agency regulations.

Rule A precedes the agency regulations.

Q That would have been about Octo-

ber of 1977; is that correct?

A I think so, that is approximately

right.

Q Prior to October, 1977, Equity

permitted under Rule A agents to obtain

a commission on scale jobs?

A Correct.

Q Was that five percent?

A It varied. There were some areas

where no commission was permissible.

-186-

There were some areas where five

percent of scale was permissible. There

were some areas where [30] five percent

of a portion of the minimum ->lary and

ten percent of it was permissible. It

depended on what contract area you were

in.

* * *

[34]Q Wouldn't a letter also be sent

to a member when it turned out that a

production contract and the agent wasn't

franchised?

A It is the same difference.

Q Theoretically, isn't it possible

for an Equity member to enter into a

contract with an agent who is not

franchised?

-187-

A Not on our forms. /

Why is that? |

A When an actor signs a contract

with an agent, he should according to our

regulations do it on the forms that are

submitted -- supplied by/ the union. If

in fact he signs one of /those forms with

a nonfranchised agent, when that contract

comes in, it is rejected because the ag-

ent is not franchised.

Q When that occurs, would the mem-

ber be sent a letter of the nature you

just described?

A Yes, again, that would be a form

letter.

* * *

[69]Q What does Equity do with the fran-

chise fees it receives from the agents?

A Put them into our general fund.

Q Are they used to cover the costs

[70] incurred by Equity in administering

the franchise program?

-188-

A There is no specific relation-

ship between the monies that we receive

for franchise fees and the cost factors

that the union has in trying to adminis-

ter that area.

Q Does the union know what its

costs and expenses are in connection with

its administration of the franchising sys-

tem?

MS. BASES: By the “union",

re you asking does Mr. Phillips

know?

MR. BREINDEL: Well, whether

Mr. Phillips or anyone else at

the union, to his knowledge.

A. To my knowledge, no one would

know. Other than the salaries involved

and being able to maybe break down, if

that were possible, which I doubt, the

time of myself, Betty Byrne, my secre-

tary, and any papers, typewriter ribbons,

paper clips, etc., etc. Other than that,

-189-

no, and the forms that have to be printed.

Q To your knowledge, has Equity ever

attempted to ascertain what it costs it to

administer the franchising system?

{71] A There is no cost breakdow- as to

how much it cost to administer that area.

Q My question was: has it ever

attempted to ascertain these costs?

A No.

-190-

DEPOSITION TESTIMONY OF DONALD

GRODY IN THE DISTRICT COURT

* * *

[28]A I cannot at the moment recall spe-

fic abuses. Generally, when abuses are

revealed to us, circumstances are descri-

bed by the actor, and we are advised of

it only if we guarantee that the actor's

anonymity will be maintained, because

raising these issues in an industry as

tight as ours is, could end up in an act-

or being black-listed or if not, very :

severely would his employment opportuni-

ties be affected. Actors are reluctant

to discuss these things. When they do

discuss them, generally, they do not want

to permit any notoriety to be attached to

it.

Q The black-list that the actors

fear, wo'ld that be by the agents or the

producers or both?

-19i-

A Well, since we are engaged in

a dispute with agents, if there would be

one, it would come from the agents, not

from the producers.

* * *

[148]Q Did Equity give TARA any reasons

for whichit sought an increase in the

franchised fees?

A My recollection is only that it

- assisted us in helping to administer the

area.

Q Administer the agency regulations?

A Yes.

Q What does Equity do with its fran-

chise fees and initiation fees?

A Well, you described some of the

things today, in terms of the checking

that Betty Bryne does, responding to in-

quiries from producers, from agents, what

members are doing, whether they are avail-

able. Really an endless thing. Betty

Byrne's phone is ringing incessantly with

-192-

inquiries, where to find actors, is this

actor signed by that agent, the producer

wants to find the actor, is he still

assigned to so and so agent. A great

deal of her work is taken up to respond-

ing in getting employment for a member.

{149]Q The franchise fees are used to

pay Equity's expenses in this connection?

A To administer the area. We pub-

lish rule A, that is published at our ex-

pense, and is given out freely to agents.

Whatever the costs are; the forms that we

prepare and disseminate.

Q Was Equity's request of TARA that

it agree to increase franchise fees and

initiation fees based upon the fact that

Equity's costs in administrating Rule A,

increased?

A I honestly don't recall.

Q Has Equity done any studies or

made any investigation to determine what

-193-

its costs are, in administering Rule A?

A No.

Q Did TARA question the need for in-

creased franchise fees?

A I believe they did; yes.

Q Did Equity justify its request for

increased fees?

A I honestly don't remember.

Q Did you --

A It was not a major issue in our dis-

cussion.

-194-

PETITIONERS' EXHIBIT NO. 3

IN THE DISTRICT COURT

[Theatrical Artists Representatives

Association, Inc. Letterhead Omitted

In Printing]

March 25, 1975

Actors Equity Association

165 West 46th Street

New York, N.Y. 10036

Attention: Messrs Theodore Bikel and

Don Grody

Reference: RULE "A": REVISIONS

Gentlemen:

The members of TARA are deeply concerned

about the present state of our business,

with which all of us are only too pain-

fully familiar. The cost of doing busi-

ness in the legitimate theatre, like

everything else, has risen sharply over

recent years, and this is particularly

true for those Agents who are primarily

or even exclusively functioning on behalf

of the members of Equity.

We are requesting a reopening of "RULE A"

-195-

for amendment, because this RULE A in its

present form does not permit franchised

agents to earn back the cost of operating

an efficient organization in New York, let

alone make a profit.

Many of our members doubt whether they can

long continue in the field. Without naming

names, we all know that many fine and trust-

ed agents have deserted the ranks, either

going into other fields such as personal

management or moving to the west coast.

Many of those who function now in the field

of Equity get their living from other sour-

ces, such as commercials, occasional motion

picture deals and so forth. Other agents

have had to give up their independence and

merge with bigger offices. But even the big

and powerful agencies find it now unprofit-

able to handle work in the theatre, espec-

ially the representation of the average in-

come earning Equity member.

-196-

If Equity wants its franchised agents to :

continue to function efficiently and effec-

tively for those actors in the theatre who

need the services of agents, and we belie-

ve these services to be more essential now

than ever before, then the provisions of

RULE A must be revised promptly.

Two years ago, representatives of TARA met

with the Agency Committee to review this

need, which was dire even then. Though the

Agency Committee was sympathetic to the

agents' problems, nothing tangible resul-

ted from the discussions.

The time is now past when agents can afford

to continue to wait for an improvement. The

improvement must be provided without delay.

Expenses are sky-rocketing: to operate an

agency with the local and long distance

telephone costs, postage, rents, taxes,

travel, entertainment and secretarial, book-

keeping, legal and other fees have now made

-197-

it imperative that help be given to enable

reputable agents to survive. Those trying

to cover regional and stock theatres have

complained especially, but all, without

exception, are feeling the pressure. Many

of those still active feel they must soon

discontinue Operation in the legitimate.

theatre unless we can all stand together

to find a way for such operations to be

practical and profitable.

For this reason we urgently request a meet-

ing between the executives of Actors Equity

Association and representatives of TARA to

consider adjustment of RULE A along lines

like the following:

a) In the recent talks between repre-

sentatives of Equity, the League of New York

Theatres and TARA, Equity and the League

agreed to reaffirm to their members that

Only franchised agents may negotiate employ-

ment deals for Equity performers. This is

-198-

indeed already provided for in RULE A, but

the clause has been regularly overlooked,

neglected and, in practice, disregarded

by producers and managers. The franchise

(RULE A) is theoretically a mutually ob-

ligatory agreement. Without real adher-

ence by the League and Equity to that pro-

vision, the more profitable engagements,

of stars and lead Players, are siphoned

off from franchised agents by innumerable

“business Managers", "attorneys", "person-

al managers", and "accountants". These

are not franchised nor controlled in any

way by Equity. If they negotiate for per-

formers -- and they do -- the commission

revenue is lost to franchised agents.

b) As in all other fields served by

agents, we should be paid a straight ten

percent commission from the first dollar

On all non-chorus engagements, including

those under $1,000.00 per week. (Perhaps

-199-

salaries Over $1,000.00 per week should be

commissionable at a higher rate, on a slid-

ing scale. As it is, the commissions from

higher paid performers enable agents to stay

in business, and service the lower paid ones

as well. Perhaps this fact should be recog-

nized and regularized. )

c) Commissions should be payable to ag-

ents on all salaries earned by Actors, (ex-

cept for chorus and for rehearsal minimum)

from the first day of the engagement to the

last. This should include LORT engagements,

where actors earn the same salary for re-

nearsal as for performance, usually for a

longer period than the actual performance

period. This would eliminate the "ten-

week cut off".

d) The greatly expanded field of Off-

Broadway should be commissionable, since

Actors often want the services of agents,

and agency operation costs are no lower

-200-

there than on Broadway ... sometimes high-

er. No agent can service Off-Broadway

profitably under present rules. As a

matter of fact, no agent can even hope to

break even when servicing Off-Broadway.

e) When a negotiated salary includes

"expenses", (often spelled out that way for

the benefit of and at the request of the

Actor) such "expenses" should be commis-

sionable as salary. This principle also

includes the recent provisions you nego-

tiated for out-of-town production coi -racts.

(Equity unilaterally"declared" these non-

commissionable this season without notice

to, or discussion with, the agents.)

£) Agents should be allowed to be re-

imbursed by clients for unusual expenses,

such as long distance phone calls, cabs,

xeroxing of scripts, and trips, incurred

at the request of the client. We genuine-

-201-

ly believe that most of the members of

Equity simply do not comprehend what it

costs to run an average office week after

week, and what is involved in a quick trip

to Boston, Philadelphia, Washington, or in

half a dozen long distance phone calls to

Straighten out some minor contractual mat-

ter, where no further improvement in terms

is involved. We would like it Clearly un-

derstood that we are not referring here to

the decision made by the agent that it is

in the best interest of the client and the

deal to make a long distance phone call,

to send a cable, or to make a trip out of

town, but are referring only to those in-

stances where the client requests maybe a

second or a third out of town visit, where

it is already impossible for him to pay

for the agent's time, but should be possi-

ble for the client to pay for the agent's

expenses. Attorneys charge for every min-

-202-

ute they spend counselling a client on the

telephone, sending a letter, making a trip.

They charge for all "unusual" expenses.

Agents are perfectly prepared to bear this

burden, as they have done historically,

but it must be their decision when to shoul-

der this burden and in what manner and to

what extent. When the client demands ad-

ditional service, for which he cannot pay,

he should at least attempt to pay the ex-

penses.

g) Equity should help agents enforce

the prompt collection of properly earned

commission. In this regard, the standard

production contract should have provisions

for the inclusion of the negotiating ag-

ents' name, (as is done with Stock and

LORT contracts). That would at least

formalize the Actor's acknowledgment of

the Agent's service, and eliminate the

"Special Management" contract. Once

-203-

again: The franchise is a mutually obli-

gatory agreement, and should be enforced

by the Union for both its members and

the Agents.

h) Both the Saenes of New York Theat-

res and TARA seem to want a rule whereby

the Union will honor the exchange of

wires and/or letters confirming a deal,

rather than insisting on the final con-

tract as the only valid agreement. This

modification could help protect the act-

ors as well as the managements. It should

be re-examined together.

We suggest a date be set within the next

three or four weeks, to start discussions

of these points. They are not peremptory

demands. Far from it. They are an urgent °*

appeal to fairness and business commonsense

to enable those who serve your members to

give good service, to function in a success-

ful and orderly manner and to fulfill .all

-204-

of the obligations that are inherent not

only in the letter of agreements or fran-

chises but in the spirit of the relation-

ship between your members and your fran-

chised agents.

Copies of this letter are going to all

Equity franchised agents whether TARA

members or not. TARA has approved it.

Please let us hear from you soon, so that

a mutually convenient appointment can be

arranged. We all have the same interests

at heart, even though from different angles,

and we all know that the need is real and

extremely urgent.

Very sincerely yours,

THEATRICAL ARTISTS REP-

palatial ASSOCIATION,

/s/ Robert Lantz

Robert Lantz, President

-205-

PETITIONERS'S EXHIBIT

NO. 5 IN THE DISTRICT COURT

MINUTES OF THE COUNCIL

MEETING OF NOVEMBER 25, 1975

* * *

It was believed agents should be put on

notice that Equity is aware of abuses.

Instances were cited where an actor who is

not signed to an agent, is told that he

would be submitted by an agent for a spec-

ific job. That actor then does not allow

any other agent to submit him, and there-

fore runs the risk of being left out.

Further, an agent who says he will submit

a member is eliminating that member from

the competition because he is really go-

ing to sumit[sic] a client of his. It was

believed to be AEA's responsibility to

police and service its members in this

area regardless of the time and money in-

volved.

-206-

PETITIONERS' EXHIBIT NO. 67

IN THE DISTRICT COURT

[National Association Of Talent Repre-

sentatives, Inc. Letterhead Omitted

In Printing]

31 August, 1977

Mr. Don Grody

Actors' Equity Association

1500 Broadway

New York, N.Y. 10036

Dear Mr. Grody:

The following members of National Assoc-

iation of Talent Representatives, Inc.

(NATR) who have also been members of

Theatrical Artists Representatives Assoc-

iation, Inc. (TARA) have resigned from

TARA because they cannot in good consci-

ence accept the terms and proposals being

negotiated by Equity and TARA.

H.A. Artists & Assoc. Oppenheim-Christie

Bret Adams, Ltd. Joel Pitt Agency

Richard Astor Rag lyn-Shamsky

J. Michael Bloom Wm. Schuller Agency

D.M.I. Talent Assoc. Mort Schwartz

Marje Fields Stewart Artists Corp.

Henderson/Hogan Agency Talent Reps.

Jacobson/Wilder Jean Thomas

Kahn, Shuman Assoc. ihc. Michael Thomas

-207-

Gary Leaverton TRH Inc.

Lester Lewis Assoc. Bob Waters Agency

Inc. Ann Wright

Please be advised that these agents who

represent a large number of your members

shall henceforth be represented by NATR

(already recognized by your sister unions

SAG and AFTRA as representing New York

Agents) in any future negotiations with

Equity.

We are enclosing a statement which clear-

ly sets forth NATR's position on the issu-

es presently dividing us.

Very truly yours,

Ruth L. Lehner

President

cc: Equity Officers

Equity Council

-208-

PETITIONERS' EXHIBIT

NO. 71 IN THE DISTRICT COURT

[Actors’ Equity Association

Letterhead Omitted In Printing]

October 11, 1977

Mr. Howard Hausman

Theatrical Artists'

Representatives Association

The William Morris Agency

1350 Avenue of the Americas

New York, New York 10019

Dear Howard:

In addition to the Memorandum of Septem-

ber 12, 1977 (additional copy enclosed)

which forms the basis for our final under-

Standing, I will here set forth those ad-

-209-

ditional understandings we have reached

in the last few weeks, in order to find a

resolution to our dispute, and which were

approved by the Actors' Equity Assoc-

iation Council at its last meeting of Sep-

tember 27, 1977.

l. It is euhecebnes that if, in future,

we agree with an agent or group of agents

on terms which are more favorable than

contained in our understanding with TARA,

we will make such more favorable terms

available to your members in the same man-

ner as provided to the agent or group of

agents.

26 We acknowledge and reinforce our un-

derstanding, as described in the Septem-

ber 12 memorandum, that neither party

"will unilaterally impose any practice or

requirement on the other without prior

-210-

agreement." Nevertheless, this under-

standing does permit, as described in the

paragraph immediately preceding it, that

the Advisory Committee on Chorus Affairs

shall be the final arbiter in determining

whether, after conversion from Principal

to Chorus contract, an agency commission

may continue to be paid.

ae In accordance with my commitment, we

here set forth the rules governing run-

of-the-play contracts. A R-O-P contract

can be executed only on the form provided

by Equity in accordance with its agree-

ment with the League of New York Theatres

and Producers Inc. A copy of the form is

attached. The deletions and amendments

appearing on the form are in the process

of being printed as part of the new form

agreed to by the League and Equity. A

R-O-P contract is usually executed for a

-2ll-

fixed period of a year or less. However,

the compensation must be at least $75

above the standard minimum. If an agent

secures the execution of a R-O-P contract

for an Equity member, the agent may col-

lect a 10% commission for the duration of

the engagement. A R-O-P contract may also

be executed for in excess of a year. This

is not an infrequent arrangement for

stars. In such instances, the Producer is

required to post additional bond in order

to assure payment of the required periods

of guarantee. See Production Rule 19G.

In the event of a breach by the employer

of a R-O-P contract, the Actor is entitled

to continue to receive his contractual

Salary and, of course, the agent his com-

mission. As a matter of policy, Equity

will not accept contracts for a fixed per-

iod o

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