LJN Newsletters

Entertainment law firms in California commonly charge the talent they represent on a percentage basis, rather than an hourly one. The typical arrangement requires the client to pay 5% of gross income derived from contracts entered into during the course of the representation. Earlier this year, a Superior Court judge in Los Angeles addressed the enforceability of this fee structure in the context of an acrimonious dispute between two entertainment firms. The principal issue in the case, and the focus of this article, is whether clients who had departed for the new firm had a continuing obligation to pay that 5% fee to the old firm as a matter of contract law.

The U.S. Court of Appeals for the Ninth Circuit upheld the vacating of an arbitrator's ruling in a film-industry dispute, due to the arbitrator's 'evident partiality.'

Last month, we wrote that the latest hot topic in corporate executive abuses may be manipulation of traders under prearranged Rule 10b5-1. We said that once a determination is made to review the historical operation of a 10b5-1 plan, reviewers should consider as a threshold issue whether they are sufficiently independent from the subject plans and traders to be properly regarded as objective. We continue with a list that describes several steps that could be taken to reveal some of the 10b5-1 plan abuses that commentators speculate may exist.

The digital-music era has resulted in many shifts in the music business. A major one has been the creative and economic repositioning of record labels and music publishers. In the following interview, coordinated by Entertainment Law & Finance Editor-in-Chief Stan Soocher, Keith C. Hauprich and Bob Donnelly discuss this repositioning and related issues from the publisher's and artist attorney's perspectives.

Backdating is different from conduct typically alleged as stock fraud because it is not in itself illegal. So long as the backdating of options is accompanied by proper accounting treatment and public disclosure, there is no securities law violation. Backdating cases thus have come to be thought of largely as accounting cases. As a result, a potent potential defense has emerged for corporate officers who may have known backdating was occurring but, because they did not have hands-on responsibility for their company's financial or accounting practices, were unaware of the accounting or disclosure consequences of that practice.

The recent settlement of parallel FCPA actions in the Southern District of Texas against Baker Hughes, Inc., a major oilfield service company, and its wholly owned subsidiary Baker Hughes Services International Inc. (collectively 'Baker Hughes'), underscores the importance of complying with the FCPA's provisions in emerging markets.

In an effort to level the playing field for U.S. businesses overseas, many OECD countries adopted the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions in 1998. Nearly 10 years later, the main result may have been to enlarge the playing field of U.S. law enforcement.

Who's going where; who's doing what.