Analyzing the Blasi/Marathon Talent Manager Commissions Case

Posted by Matthew Belloni

The California Supreme Court just issued its opinion in Marathon Entertainment v. Blasi, the closely-watched case concerning talent managers who "procure" work for their clients. Here's the decision.

For those unfamiliar with the issues, a quick refresher: Under California's strict Talent Agencies Act, only licensed talent agents can "procure" jobs for clients; managers may not, although it's no secret that almost every single manager has solicited work for a client at one point or another. They do so knowing the punishment is that a client who wants to leave them can later ask the state's Labor Commissioner to void the management contract if the manager is found to have procured work without a license.

That's what happened to Rick Siegel and his company, Marathon Entertainment, when actress Rosa Blasi (Lifetime's "Strong Medicine") decided to end their relationship. She stopped paying commissions, he sued, then she got the Labor Commissioner to declare the deal void because Siegel had procured work, even though that work was unrelated to "Strong Medicine."

There's the issue. Siegel and his lawyers, led by Donald Smiley, convinced the state appellate court that a single act of procurement shouldn't necessarily void the entire agreement and in certain instances a violation of the Talent Agencies Act should be "severable" from the rest of the deal. In short, even though Siegel may have violated the law, he shouldn't lose the "Strong Medicine" commission because he didn't illegally help procure it.   

The California Supreme Court, in a unanimous decision, essentially agreed with that position. It ruled that particular acts of procurement in some (but not all) instances are severable from the rest of the deal if that contract is otherwise lawful.

The effect of the decision is tough to predict. Blasi's lawyers, led by Michael Plonsker (full disclosure: I previously practiced law at Plonsker's firm, though I never worked on this case), have argued that the strict remedy for procurement was designed to protect talent from unscrupulous managers (agents, unlike managers, are heavily regulated), and that those managers will now be emboldened to break the law and procure all kinds of work without fear of losing commissions.

But the court didn't say all violations are severable. It has left the decision up to the Labor Commissioner to decide whether Siegel's acts of procurement (or those of any other manager) should be severed from the rest of his deal. This decision just makes it more difficult for talent to show that their former manager acted illegally. It will probably lead to fewer disputes finding their way to the Labor Commissioner.

But the decision isn't a total win for Siegel. He had argued that the Talent Agencies Act shouldn't even apply to managers, an argument the court summarily rejected. And he still has to plead his case to the Labor Commissioner.