19 Entertainment Lawsuit Could Change Management Contracts Forever

How the 19 Entertainment Lawsuit could change everything

19 entertainment lawsuitJust over a year ago, Philip Philips sought to change the way contracts between reality television program participants and their managers are structured with his 19 Entertainment lawsuit. However, the group he sued is working to make sure that it can maintain the power to procure jobs for clients and require them to accept.

19 Entertainment, the producer of “American Idol,” was named in a petition to determine controversy by the singer, who claimed he was manipulated through his contract with the company. The deal required him to sign on to numerous jobs to participate in the long-running singing competition. Philips wasn’t the first former participant to file suit against 19 Entertainment, but he has made significant progress, and now the company is striking back. The string of lawsuits point towards a potential problem with the way production companies negotiate with reality TV participants. Specifically, the issue stems from what managers require talent to do outside of the programs.

Why Philips is petitioning his contract

If reality TV show participants achieve a certain level of fame through their appearances, they can leverage their public images in numerous ways. In a best-case scenario, that typically involves the individuals seeking endorsement and other TV deals. However, sometimes they can’t do this because of the extensive requirements of their contracts. Deals such as the one between 19 Entertainment and Philips may require participants to make appearances outside of programs such as “American Idol.”

“Under the Talent Agencies Act, only an agent can procure work for a client.”

This, Philips claimed, is a violation of certain labor regulations. First, under the Talent Agencies Act, only an agent can procure work for a client. Also, his lawsuit alleged that 19 Entertainment breached its fiduciary duty to Philips by requiring him to work jobs that benefited the company more than him. The production firm’s recently filed complaint seeks to test the singer’s claims. The company alleged that Philips has been avoiding his contractual duties in anticipation of a ruling in his favor, according to The Hollywood Reporter.

Philips’ attorney claimed the company’s complaint is an attempt to sidestep California regulations protecting entertainers from overly burdensome contracts. 19 Entertainment hopes to have the authority to continue requiring Philips to work events required by his contract.

What 19 Entertainment’s lawsuit means for Philips’ crusade

If 19 Entertainment is able to pursue its legal action against Philips and wins the right to require him to make appearances noted in his contract, that outcome could be a victory for management companies in California. This would give these firms the power to procure employment for their clients, similar to the role agents play. In addition, it could alleviate the fiduciary duty Philips claimed exists and give managers more control over what they ask clients to do.

Anyone hoping for a role in reality TV or participating in an ongoing show should review his contracts and determine whether his manager is overstepping the boundaries of the Talent Agencies Act and complying with its fiduciary duty. That may not be something clients can challenge management on for long if 19 Entertainment comes out of this legal entanglement victorious.

What’s next?

For now, Philips has made significant progress in his fight for more favorable contracts. Whether this tilt goes in favor of Philips or 19 Entertainment remains to be determined, and the outcome can end up having a substantial effect on contracts between managers and their clients.

If you’re reviewing a management contract or would like to discuss the matter further, contact me, Anthony Caruso, at 201-806-3364.

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Anthony R. Caruso is a business transactional attorney in New York and New Jersey with experience in structuring, negotiation and completion of legal deals involving business, entrepreneurs, athletes and performers.

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