David Simon Drops Individual Claims Against CAA In WGA’s Anti-Packaging Lawsuit, Remains Part Of Broader Antitrust Suit; Writer & WGAE Issue Statements – Update

David Robb
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EXCLUSIVE, updated with statements from David Simon and WGA East, 3:45 PM: Writer-producer David Simon, the outspoken critic of TV packaging who in April joined the WGA’s anti-packaging lawsuit against Hollywood’s Big Four talent agencies, has dismissed his individual claims against CAA, in which he’d accused his former agency of violating state and federal laws by taking packaging fees on his show Homicide: Life on the Street. He remains, however, a party to the WGA’s broader anti-trust claims against the agencies for alleged price-fixing and group boycott.

In a federal court filing Monday (read it here), Simon dropped all seven of his individual claims against CAA for breach of fiduciary duty; constructive fraud; unfair competition, and four claims of racketeering in violation of the RICO Act.

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The one-paragraph legalese dismissal of his seven individual counter-claims against CAA states: “Counterclaimant David Simon’s individual counterclaims styled as his Fifth through Eleventh Claims for Relief in Defendants’ Answer to First Consolidated Complaint and Defendants’ and Counterclaimants’ Consolidated Counterclaims, Doc. No. 44, are hereby voluntarily dismissed without prejudice pursuant to Rule 41(c).”

Simon, a member of WGA East, said in a statement:

“I was informed that CAA threatened me with legal action based on the May 2000 settlement. On the advice of counsel, rather than challenge that settlement, I agreed to withdraw some, but not all, of my claims against CAA. My view of CAA’s dishonorable performance as the representative of my work, its secret profiteering, and its bid-rigging of the work of writers in negotiations with other entities remains unchanged. Packaging is theft and a perfect idealization of what it means for a representative agency to betray clients and fail the most basic fiduciary responsibilities.

“I was specifically asked by my union to join in the civil action against talent agencies engaged in packaging, a pernicious practice that is the equivalent of organized extortion and bid-rigging in our industry. At the time, I informed my attorneys of the dates of my conflicts with CAA over their corrupt practices, as well as what I regarded as a limited settlement by which I agreed to retain my television agent at that agency while severing all contact with their literary rights division, which was specifically engaged in the fraudulent practices. Pending the ability to review in discovery the detailed terms of the limited settlement, I became a plaintiff in the lawsuit to challenge the talent agencies’ packaging practice. As I have always stated, any damages recovered would be delivered to a 501c3 charity and that my engagement with the legal action was to further a legal argument and not to seek personal recompense.”

The WGA said in a statement: “David Simon remains a counter-claimant, along with the WGA East, in both state and federal antitrust counterclaims against CAA that are currently are being heard in California federal court. Upon the recommendation of counsel, Mr. Simon voluntarily dismissed other counterclaims against CAA on November 18 rather than challenge a May 2000 settlement agreement. The lawsuit against CAA, WME and UTA continues to move forward in an effort to end agencies’ conflicted business practices.”

CAA attorney Richard Kendall had warned Simon and the guild’s lawyers September 6 that they could be sanctioned by the court if they didn’t dismiss his individual claims because they allegedly knew that his packaging claims were time-barred and “affirmatively false” – which would violate Rule 11 of the Federal Rules of Civil Procedure. That rule requires every pleading in federal court to be brought in good faith and for a proper purpose; to be based in law, and on factual allegations and evidence.

“David Simon’s claims are particularly egregious,” Kendall told the guild’s attorneys in September. “Simon claims that he was harmed because of his inclusion in a packaging arrangement for the television series, Homicide: Life on the Street, which was produced over seven seasons between 1993 and 1999. But Simon and CAA resolved that dispute in a binding settlement agreement, and on May 4, 2000, in return for a payment of $30,000, Simon expressly released CAA in writing from any and all claims with respect to Homicide, specifically including any claims arising out of CAA’s packaging fees.

“Since that time, at Simon’s request and as he has publicly acknowledged, CAA has not packaged a single one of Simon’s projects. Indeed, Simon has admitted publicly that he knew that his claims were released, and that he informed the WGA and the WGA’s attorneys that he had released his claims almost 20 years ago. There is no possible excuse for bringing claims on behalf of Simon.”

The guild’s counterclaim, Kendall said in his letter, “is brought not only on behalf of the WGA, but also on behalf of certain individuals, including David Simon, Meredith Stiehm, and Barbara Hall. Each of the claims from these individuals is – as the WGA and the writers well know – already released or barred by the statute of limitations. CAA already alerted the WGA to this deficiency in the state case, and there is no dispute about it whatsoever. Bringing claims that these individuals know or should know to a certainty have no basis is improper. To be clear, it will subject these individual litigants to personal sanction.”

“These individuals and the WGA and its counsel knew that their claims were barred when they brought them,” he wrote, “yet decided to bring them anyway.”

Stiehm and Hall have not dismissed their individual claims.

In his letter, Kendall also urged the guild’s attorneys “to re-evaluate its pleadings, and its approach to this litigation. We must insist that the WGA adhere to the legal standards that govern litigants in the federal courts. You have informed us, in a telephone conference held on September 3, 2019, that you expect the WGA to file an amended counterclaim in response to CAA’s First Amended Complaint. We expect that you will ensure that the amended counterclaim, unlike the WGA’s current Counterclaim, pleads facts and law in good faith as required by the Federal Rules. If your amended counterclaim does not do so, CAA will seek and obtain all of its available remedies to the full extent of the law, including sanctions under Rule 11 of the Federal Rules of Civil Procedure.”

The WGA filed suit in state court against the Big 4 agencies on April 17 – just days after it ordered all of its members to fire their agents who refuse to sign its original Code of Conduct, which banned packaging fees. CAA, WME and UTA countersued in federal court in June, claiming that the guild was involved in an “unlawful group boycott.” In August, the guild dropped its lawsuit in state court and consolidated its claims in federal court – where it now sits.

The next court date, which is scheduled for December 6, is set to hear the guild’s motion to dismiss the agencies’ consolidated anti-trust complaint. ICM Partners had originally been a defendant in the state case – which the guild dropped in August – and was not named as a defendant when the WGA consolidated its claims in federal court, leading the agency to claim “victory.”

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