Row could paralyse Hollywood

Representatives for Hollywood’s leading writers and agents have met in Los Angeles, hoping to avert an implosion in the creative industry as the clock ticks toward a deadline for a deal. But the prospects for resolution remain far off.

The two sides are deadlocked over the so-called franchise agreement, which governs how agents and writers share revenue.

The Writers Guild of America (WGA) has laid out a counterproposal to the offer that agents, represented by the Association of Talent Agents, suggested this week. If the two sides are unable to come to an agreement by April 6, when the current deal expires, the nearly 20,000 writers responsible for the country’s biggest TV shows and movies could fire their agents en masse, throwing the US entertainment industry into chaos.

This week marked the parties’ first substantive talks since rhetoric began heating up in recent months. But many industry insiders believe the chances for a new deal remain low.

‘‘I think this is headed to court,’’ said a legal authority on the matter who spoke on the condition of anonymity. ‘‘The WGA appears to be preparing for a major battle.’’

The writers say they do not wish to renew the franchise agreement without significant revisions.

They want new units that the agencies created to function as production companies – which the writers say increases the possibility for conflicts of interest – to instead be formally carved out as separate entities.

They also want to overhaul the main ways agents collect money on writers’ work. At the moment, those revenues are dominated not by standard commissions from clients but by so-called packaging fees, in which studios pay the agents for putting together the creative elements of a show. The writers say this encourages agents to act against their clients’ interests, and also allow them to dip into a pool of revenue that should go to creators.

The agencies say the writers are working under false assumptions.

The talks come after the WGA released a white paper this week that called the major agencies a ‘‘cartel’’ which uses its ‘‘control of talent primarily to enrich themselves’’.

A mass firing of agents would probably not trigger an immediate stoppage of new material on TV and in cinemas. In the short term, writers could be represented by lawyers, managers and, potentially, a handful of smaller agencies that could agree to abide by the WGA’s preferred codes.

But the longer-term implications are unclear. A protracted interruption in the way Hollywood does business could lead to projects stalling and consumers seeing fewer options in their viewing choices.

The sides are scheduled to meet again on Tuesday.

– Washington Post