Tuesday, April 30, 2002
Kelsey Grammer Loses Bid to Avoid $2 Million Payment to Ex-Agent
By a MetNews Staff Writer
Actor Kelsey Grammer must pay $2 million in back commissions to his former talent agency, the Ninth U.S. Circuit Court of Appeals ruled yesterday, in an opinion that accords the Screen Actors Guild wide latitude in interpreting its collective bargaining agreement with agents.
The ruling keeps intact a SAG labor arbitration panel’s decision that the Artists Agency was due commissions that Grammer and his production company, Grammnet Inc., paid to the William Morris Agency during a disputed two-year period.
The discord emerged when the Emmy-winning star of “Frasier” renegotiated his deal with the Artists Agency, claiming the firm failed to get him any movie deals and not much in the way of television work. Grammer landed his role as psychiatrist Frasier Crane on both NBC’s long-running “Cheers” and his current sitcom without the agency’s participation.
Grammer asked to modify his contract in order to get another agent to focus on films, and in 1995 the Artists Agency agreed to extend their TV deal for two years but to let the actor get another agent for movies.
Under the collective bargaining agreement between SAG, the Association of Talent Agents and the National Association of Talent Representatives, the new deal was sent to SAG, which first rejected it but later relented.
Grammer was still unhappy and finally terminated his relationship with the Artists Agency altogether. He stopped paying commissions in 1998, arguing that his 1995 renegotiated agreement broke the guild’s collective bargaining agreement with agents in four respects and was consequently invalid, but that the attempt to renegotiate also scrapped the original agreement.
The agency filed a claim with SAG, and Grammer responded with a claim of his own to recoup the commissions he had already paid.
SAG arbitrators agreed with Grammer that the new contract was improperly post-dated, lasted too long under SAG rules, was executed at the wrong time and filed too late. Grammer was also right, they noted, that there was no written waiver of the rules, as the collective bargaining agreement appears to require.
But they said none of those flaws were fatal.
U.S. District Judge Dean Pregerson agreed and ordered Grammer to pay $2,034,391 in back commissions. A three-judge Ninth Circuit panel agreed.
Judge A. Wallace Tashima wrote that the collective bargaining agreement rules are often contradictory and that arbitrators must interpret them with an eye on the “industrial common law.”
Past actor-agent agreements suggest that waiver of rules governing changes in agency contracts need not be in writing, despite a rule that says it must, Tashima said.
The “ostensibly ‘plain’ provisions must be construed in the larger context of [the rules] and industry practice generally,” Tashima said.
The case is Grammer v. The Artists Agency, 00-56994.
Copyright 2002, Metropolitan News Company