How Range Is Firing Back At CAA Over Its Blockbuster Lawsuit

Yahoo

28-01-2025

In the periphery of CAA's lawsuit against management firm Range Media Partners is a nod to a bitter standoff five years ago between the Writers Guild of America and talent agents that changed the way agencies do business. It concerned the decades-old collection of packaging fees, whereby agencies receive ongoing payments from studios in exchange for having bundled one or more clients on a project, as well as agency-owned production entities that take ownership stakes in content. The agencies insisted that the practices offer higher financial upside for talent, while the WGA called out potential conflicts of interest that disincentivize agents from getting their clients the best deal possible. Ultimately, CAA backed down, agreeing to a guild rule barring it from acting as a packaging agent or owning a major stake in a production entity.
At first glance, CAA's lawsuit is about a tale as old as time: Departing agents allegedly stole confidential information to poach clients. But its scope reaches the heart of the firm's business dealings. CAA claims that Range is actually just a rival talent agency masquerading as a management company, giving it an unfair advantage over competitors because it's not bound by certain guild agreements, like rules over how deals can be structured. The company, for instance, can offer high-profile clients the ability to avoid paying a commission in favor of giving it a producer fee or credit on their project.
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The lawsuit seeks a court order blocking Range from further violating the Talent Agencies Act, a licensing scheme that says only licensed agents can 'procure' work for clients in the entertainment business and that managers caught doing the same can have their contracts voided and commissions forfeited, and representing WGA members without permission from the guild. One question that could decide the case has emerged in the legal standoff: Is CAA improperly using its lawsuit filed in California state court as a vehicle to assert claims believed to be under the purview of the California Labor Commission? Beyond that, is Range's business model something CAA can target in a lawsuit?
By Range's thinking, detailed in a demurrer filed on Monday, CAA should be barred from further pursuing the case. Even if the facts alleged in its complaint are true — and it doesn't make that concession — the agency doesn't assert legally sufficient claims, Range alleges. It characterizes the dispute as a powerful company attempting to penalize longtime employees for leaving, portraying CAA as a quasi monopolist that 'leveraged its dominance and market power to control key aspects of the entertainment industry.'
In a statement, Orin Snyder, a lawyer for Range, said CAA is 'trying to use its power to bully and intimidate Range and its founders.' He adds, 'For an agency that professes to support talent, it's ironic that CAA is now attempting to reduce choice in the industry.'
And when four former CAA employees left the agency to join Range, founded by CAA's former head of its TV department Peter Micelli, it retaliated by cancelling their vested equity citing allegedly illegal noncompete provisions in their contracts that shouldn't apply anyway because they intended to work as managers and not as agents, Range says in the filing. CAA only filed its lawsuit, the firm adds, because arbitration isn't going its way. 'CAA has not explained why it waited until late 2024 to file this case if, as it alleges, Range stole confidential information and competed unlawfully four years ago, in 2020. Nor has it explained why it did not file suit two years ago when it raised these allegations in arbitration,' writes Snyder, joined by Ilissa Samplin and Daniel Nowicki. He argues that CAA's claims are 'either preempted, filed in the wrong tribunal, or defective as a matter of law because CAA lacks standing to bring the claim.'
The thrust of CAA's lawsuit revolves around the claim that Range gained an unfair competitive advantage by stealing confidential information, violating the TAA and neglecting to contract with the WGA. Range responds by arguing that The Uniform Trade Secrets Act blocks any allegation concerning the theft of confidential business information. That's not all. It says that CAA should take its case to the California Labor Commission, which has authority over claims alleging a violation of the TAA.
'Of course, this does not mean CAA is entitled to any relief from the Labor Commissioner, or that it even has standing to bring a TAA claim,' the filing states. 'The Labor Commissioner's regulations specify that the only cognizable disputes under the TAA are disputes between artists and their agents, not between an agency and its alleged competitor.'
To date, no artist has filed a TAA complaint against Range, the company says. Regardless, it adds that CAA cannot bring a claim alleging a violation of the law against Range on behalf of talent. Range advances similar arguments in moving to dismiss claims over aiding and abetting, as well as interference with prospective economic advantage.
In its latest filing, Range says that the legal roadblocks CAA faces are fatal and that it shouldn't be allowed to fix its lawsuit if the court grants its motion.
Since its inception four years ago, Range has surfaced as a competitor — albeit a small one — in a talent agency landscape that's consolidated into three major players after CAA in 2022 closed its acquisition of ICM Partners. It's drawn investments from hedge fund billionaire Steve Cohen's Point72 Ventures, media mogul John Malone's Liberty Global, TPG founder David Bonderman's Wildcat Capital, family entertainment company Playground Productions and A+E Networks, which serves as a co-producer on scripted TV projects set up at the company.
And Range employees aren't the only former agents to pivot to management. Theresa Kang and Phil Sun have both left WME in recent years to start their own management firms.
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