Unresolved issues from writers’ strike spill over into Capitol

Three months after the end of the writers strike that crippled Hollywood for 100 days, a bill working through the state Senate threatens to reopen some of the unresolved issues in the dispute between writers and studio owners.

SB 1765 by Sen. Sheila Kuehl, D-Santa Monica, who is a member of the Screen Actors Guild, would ensure that writers, actors and crew members who work on television shows and movies continue to receive residual checks based on a show or movie’s “fair-market value.”

The Writers Guild of America, which is sponsoring the legislation, says the bill is necessary to ensure residual payments to actors, writers and crew members in the era of media consolidation. But the Motion Picture Association of America has accused the writers of trying to make an end-run around the collective bargaining process, trying to gain concessions from the Legislature that they were unable to extract from studios at the bargaining table.
There is also a question of how, if at all, Gov. Arnold Schwarzenegger may personally profit from the bill, if it becomes law.

The issue of residual payments was a key motivation for the writers’ 100-day-long strike. Now, the studios say, writers are trying to get from the Legislature what they couldn’t get in the bargaining process.

“After shaking hands on an agreement … the Writers Guild leadership apparently turned immediately to Sacramento in an effort to renege on their side of [the] bargain,” claims a statement from the MPAA. “A deal is a deal … and it is in extraordinarily bad faith to sign a collective bargaining agreement, rise from the negotiating table, and run to the Legislature.”

Teamsters lobbyist Barry Broad, whose members include animal trainers, set designers and other crew members who also receive residual payments, says the MPAA is crying foul over what is standard political procedure. And, he says, it is not just the writers who have a stake in this legislative fight.

“Just because it got raised in collective bargaining doesn’t mean you can’t bring a bill,” he said. “That argument is just stupid.”
Broad says the bill is necessary in the wake of changes of decade-old changes in federal law. “Prior to the mid ‘90s, a television network couldn’t own a production company,” he says. “In the past, when [a studio] sold a show into syndication, the seller had an incentive to sell it to the highest bidder.”

Since the changes in federal law, Broad says, there has been a massive consolidation in the film and television industries.  There are now massive companies that own multiple television stations, or film studios and television networks.

“What they’re doing is they’re ‘selling’ a show to an affiliated entity and basically paying nothing for it,” says Broad.

Residual payouts to writers, actors and other crew members are linked to the sale price of those movies and television shows. Since shows are movies are basically being transferred within the same company for little or no money, the WGA claims writers, actors and crew members are being short-changed.

“This important piece of legislation will help ensure reliable accounting among the major Hollywood studios so that creative talent and all entertainment employees that rely on residuals will be fairly compensated for the contributions they make to the industry, said Patric M. Verrone, president of the Writers Guild of America, West, said in a statement.

According to the statement, there have been an number of lawsuits over the issue of fair-market value.

A statement from the Screen Actors Guild articulated support for setting a fair-market value. “Actors deserve to be paid the fair market value rate for all transactions between all companies, even if the same corporation owns the entities,” the statement says. “As the entertainment business continues to consolidate, and as more deals are being made within the same conglomerates, the issue of fair market valuation is becoming more and more of a concern.”

This bill could presumably directly effect the pocketbook of Gov. Schwarzenegger, who starred in a number of movies before becoming California governor. A spokesman for the governor said he has no position on the measure, but the fact that the governor may have a personal financial stake in the bill will not affect his position.

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