The WGA confirmed on Wednesday that it has reached a deal with CAA for a new franchise agreement that will allow the guild members to return to the agency. “The WGA and CAA have reached an agreement on a franchise agreement,” the guild told its members today. “Therefore, CAA may again represent Guild members for covered writing services with immediate effect. WGA and CAA have also agreed to withdraw the legal claims each filed against each other in federal court. “
This leaves WME the last remaining major body to sign the guild’s franchise agreement.
The guild outlined the terms of the agreement, saying today that the deal “ contains the same terms as those outlined in the ICM / UTA deal, protecting writers in the three fundamental areas that the guild has emphasized since the campaign began. :
CAA, WGA reach deal that puts writers back in the office chair; Lawsuit dropped; WME Hopeful it’s the following
- Contract, deal note, and billing information will be provided to the Guild, allowing the WGA and the agency to work together to systematically address wage arrears and free work.
- Strict 20% limitation on agency ownership of manufacturing entities.
- A sunset period that ends the practice of packaging on June 30, 2022.
Read the full agreement here.
“In recent months,” the guild said, “the WGA, CAA and its private equity owner TPG have negotiated steps the agency should take to comply with the franchise agreement (ie divestment of wiip) and protect against the unique Address conflicts of interest caused by CAA’s ownership by TPG There are three additional layers of protection for writers negotiated in the side letter (read in full here).
Here’s a brief summary of these additional terms:
“In accordance with the franchise agreement, CAA and TPG placed their ownership interests in wiip in an irrevocably blind trust with a clear mandate for the trustee to sell that interest to the required 20% or less. CAA and TPG further agreed to relinquish operational oversight of Wiip while their ownership interests are in the blind trust. The side letter provides reasonable time for the sale of CAA and TPG’s interests in wiip, and for serious consequences if the sale is not completed by that date, including the right for the WGA to suspend CAA’s ability to represent writers, and the requirement that CAA places any wiip-related fees or commissions it receives during the suspension period for safekeeping until the sale is completed. De Gilde has agreed to keep the date confidential so as not to influence the trustee’s negotiations with potential buyers. “
The side letter, the guild said, “ensures that CAA and any TPG entity will not jointly have an ownership interest of more than 20% in another affiliated manufacturing company. In addition, the TPG fund that owns CAA has agreed that it will not have an ownership interest of more than 20% in any affiliated manufacturing company, regardless of whether CAA also has an interest in the entity.
“The side letter also includes precautions for situations involving TPG entities – ie, investment funds – that have no ownership interest in CAA but more than 20% interest in a manufacturing company. TPG has agreed to disclose the identities of all of these entities in the future. At the moment there is only one such company, and it is not an MBA signatory. If CAA negotiates a deal with such an entity, even if CAA itself has no ownership interest in it, the agency must disclose to its writer clients the existence of TPG’s ownership. CAA must also provide the guild with a copy of the bid and points from the final deal. This transparency allows the Guild to ensure that CAA negotiates appropriate deals for writers in these circumstances and that TPG’s ownership interest does not stifle the value of writers’ services. If there are irregularities in the writer agreements – such as, for example, low costs for pilot scripts – the guild will have the information it needs to investigate and take necessary corrective action with CAA. “
The guild added that it “appreciates the hard work of both CAA and TPG in resolving the complicated issues involved in these negotiations.”