WME finally ends standoff with Writers Guild

WME said Friday it reached a deal with the Writers Guild of America after a year-plus dispute with the union over agency practices.

The Beverly Hills-based company was the last major talent agency to reach a deal with the WGA, adding financial pressure at a time when Hollywood businesses struggled amid a pandemic that shelved productions and live events. With this deal, WME can now represent WGA writers for the first time since April 2019 when writers had fired their agents due to the dispute.

“WME and the WGA have agreed to a new franchise deal that addresses writers’ core concerns while recognizing the unique aspects of our business,” said Ari Emanuel, chief executive of Endeavor, the parent company of WME. “Writers have been a part of this agency since our inception, and they will continue to be a part of the lifeblood of WME.”

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At the heart of the union’s dispute with WME were two issues: the practice of collecting packaging fees and Endeavor’s ownership in affiliated production company Endeavor Content, both of which the union believed presented conflicts of interest for writers’ agents.

The union had raised similar concerns with other agencies and negotiated more than 80 deals with individual firms. Last summer, WGA achieved a significant breakthrough when it landed a deal with UTA and has reached agreements with all four major agencies, including CAA and ICM Partners and now WME.

As part of the agreement, Endeavor and its investor Silver Lake’s fund will reduce their ownership stake in Endeavor Content to 20% or less, similar to a deal reached by major agency CAA. WME will also end packaging — in which an agency collects fees for pulling together talent for projects — by the end of June 2022.

“I’ve said repeatedly no one wanted the agency campaign over more than me, and I’m very pleased that we’ve achieved our goal: The agencies who represent us now have their financial interests aligned with their writer clients, and the agencies’ problematic business practices such as packaging fees and agency-owned production entities are at an end,” said David Goodman, WGA West’s president. “As difficult as this battle was, the simple and just clarity of the goal, that a writer’s agent should make more only when his client does, is what helped us succeed.”

Retired judge Louis Meisinger will serve as a monitor overseeing Endeavor’s reduction of its ownership stake. During this period, the judge will also monitor writer deals between WME and Endeavor Content, said the WGA agency negotiating committee in a letter to union members. The committee did not disclose the timing of the sale.

Silver Lake would also have to disclose to WGA if one of its other investment funds — beyond the one that invested in Endeavor — hold more than 20% ownership in a production company, the union committee said.

One exemption on the 20% production ownership cap is given to WME investors who own 5% or less of the agency and have “no control over its operations or management,” the WGA committee said. WME is a privately held company, but if it were to one day become publicly traded,
the agreement’s rules would still apply.

WME’s parent company, Endeavor, had plans to go public in 2019, but the agency shelved those plans due to unstable market conditions.

The agreement between WME and WGA ends on April 12, 2025 but can be extended on a yearly basis after the expiration.

WME and the WGA had sued each other during the dispute. On Friday, WME’s attorney filed a court document stating that the agency had reached a settlement with the WGA and both sides are asking to dismiss the lawsuit.

Times staff writer Anousha Sakoui contributed to this report.