Siegel Goes To Terminator For Closure

Rick Siegel , founder and major domo for Marathon Entertainment, has taken his battle with the legal and governmental denizens over the ability for managers to represent clients and procure employment right to the top.

He’s filed a diatribe of a letter to Gov. Arnold Schwarzenegger , breaking down his ongoing appeal with the Ninth Circuit Court of Appeals in a federal lawsuit he filed against State Labor Commissioner Andrea Broadstreet.

Rick has been fighting this good fight for nearly 10 years solely with the intent of defending managers’ rights and allowing them to represent talent and writers and even producers without breaking the law. Currently, managers are not allowed to procure jobs for clients and supposedly are never supposed to be involved in any kind of negotiation for their clients’ work.

Of course, managers in Hollywood ignore these laws all the time. But Siegel got tired of it when he had a knock-down drag-out fight with Nia Vardalos of “My Big Fat Greek Wedding” fame back in 2002 when the film broke all sorts of records and made tons of cash. As a result, Siegel reared his head and challenged the status quo of the management syndicate. He’s been at it ever since.

The Schwarzenegger missive is below:

October 2, 2008
Governor Arnold Schwarzenegger
State Capitol Building
Sacramento, CA 95814


Dear Governor Schwarzenegger,

My name is Rick Siegel. This morning I filed an appeal with the Ninth Circuit Court of Appeals in the federal lawsuit (CV08-2480-CAS (SSx) I have against State Labor Commissioner Andrea Bradstreet.

The suit asks for affirmation that the current enforcement of the Talent Agencies Act (‘TAA’), in particular the meting out of penalties impairing talent representative/artist contracts without any statutory guidelines of what, if any, the penalty for a TAA violation can be, is therefore unconstitutionally vague and violates the Contracts Clause: Article I, Section 10 of the United States Constitution.

While rebuffed at the District Court, that Court wrongly found the Labor Commission had the right to impair a personal manager/artist contract utilizing CA. Civil Code Sections 1598-99. But those statutes only inform an adjudicator that when a part or parts of a contract are ruled unlawful, the unlawful portion(s) of the contract should be voided and the lawful parts should remain intact. The determination ignored the questions the Court was to answer: (1) Was there a statute inside the TAA that provides notice of what the penalty would be if a talent representative procures an employment opportunity without a talent agency license; and (2) as the answer to that question is “no, there is no statute,” per several precedents, isn’t the administering of these penalties unconstitutional?

Though I am the only Plaintiff, my entire profession stands behind me in this effort. Enclosed with this letter are copies of 212 letters by personal managers who, armed with the knowledge that its current meting out of penalties impairing their contractual rights is unconstitutional, are now asking the Labor Commissioner to voluntarily stop their wrongful enforcement. And more letters are coming.

We now request your office to aid us in our effort. With no penalty statute, it is impossible to defend the current enforcement. The Commissioner contends Article III, Section 3.5 of the California Constitution requires them to defend their position through an appellate decision, but that statute requires the agency only defend the enforcement of statutes that exist, not enforcement meted out with no statutory imperative.

It will cost the Labor Commission tens, perhaps hundreds of thousand of dollars in man-hours just to defend this matter. Even if I do not prevail, the State should expect every personal manager from today forward to initiate a similar suit if the Labor Commissioner ever again chooses to impair a personal manager’s contract with their client. And if, or more likely when a Federal Court rules that by impairing personal managers’ contracts unconstitutionally deprives personal managers of their property, the State will be liable for hundreds of millions of dollars in damages; other personal managers who have been similarly compromised will surely file suit to be made whole from their losses.

As an example, one of the enclosed letters is from Matthew Katz, whose contract with The Jefferson Airplane worth approximately eight million dollars was disgorged in 1968. With interest and the related damages this disgorgement caused his business, just that one matter could be a mid-eight figure liability. Like me however, he would be assuaged if the Labor Commissioner agrees to stop its current enforcement so no one from today forward is similarly compromised. The Thirteenth Amendment does not state, “All men must be paid for their labor… unless they happen to be personal managers living or doing business in the State of California.”

At a time where all expenditures must be carefully considered, the Labor Commission is spending state dollars defending an indefensible position that if not stopped will potentially create a nine-figure liability for the State. I hope your office will help actualize a much more palatable alternative: getting the Labor Commissioner to send the Legislature an open letter that her agency will no longer accept complaints or adjudicate any disputes relevant to the unlicensed procurement of employment opportunities until and unless the lawmakers better define who is to be regulated, what the prohibited activity is, and most important, what the penalty is if someone is found to have engaged in the prohibited activity. I would happily withdraw my suit at that time, and that action would make all other potential suits moot.

I appreciate your prompt attention to this matter.

Rick Siegel
President, Marathon Entertainment, Inc.

Siegel’s letter also included the precedents that back up his arguments.

Violations of law are “made up of two parts, forbidden conduct and a prescribed penalty. The former without the latter is no [violation].” Wayne R. LaFave & Austin W. Scott, Jr., Substantive Criminal Law 1.2(d) (1986); see United States v. Evans, 333 U.S. 483, 486 (1948); State v. Fair Lawn Serv. Ctr., Inc., Supra; Redding v. State, 85 N.W.2d 647, 652 (Neb. 1957); State v. Ching, 619 P.2d 93, 94 (Haw. 1980). “Where a statute fails to provide a penalty it has been uniformly held that it is beyond the power of the court to prescribe a penalty.” State v. Fair Lawn Service Center, Inc., 120 A.2d 233, 236 (N.J. 1956). If a criminal statute or ordinance does not specify a penalty, it is beyond our province to prescribe one on the assumption that the deficiency was simply an ‘oversight.’ See Evans Supra, 333 U.S. at 486; State v. Fair Lawn Serv. Ctr., Supra at 236.