NATAS Pacific Southwest Chapter May 2008 Newsletter - National ...

LEGAL NOTES
By Dan Eaton
Court: Producer of Best Picture
Can’t “Crash” Academy’s Party
Good news: You were one of six producers who received screen credit on “Crash,” a
film up for an Academy Award for Best Picture. You have received a Producers Guild of
America form asking you to describe your personal contribution to the production of the film. Bad news:
The Academy rules limit award recipients to the “three or fewer producers who have performed the major
portion of the producer function.” Good news: The Guild designates two producers as Oscar-worthy. Bad
news: You are not one of them and your appeals to the Guild and the Academy are rejected. Good news:
Your film wins Best Picture. Bad news: No statue for you. Good news: You learn that the law of California,
the home state of the Guild and the Academy, generally gives members a right to sue where an organization’s
decision-making procedures are unfair. You believe there is an injustice here. You confidently sue the
Academy and the Guild. Bad news: The trial judge throws your case out without even forcing the Academy
and the Guild to justify their decision and the Court of Appeal agrees. Why?
In Yari v. Producers Guild of America, Inc., a case decided in early March of this year, the Court of Appeal
ruled that the right to sue because an organization’s procedures are unfair is limited to challenging those
“private decisions which can effectively deprive an individual of the ability to practice a trade or profession.”
Yes, Mr. Yari’s complaint was full of claims about the power and prestige of the Academy, about how his
career would have been enhanced had he received the award and how it was tarnished because he did not.
But he conceded in his complaint that he continued to work as a motion picture producer after the Oscars
and despite the groups’ decision not to deem him eligible to receive a statue. And neither group had any
power to deprive him of receiving screen credit as a producer of Crash or any other film. “The complaint
thus alleged that [the Guild and the Academy] did not control Yari’s right to practice the trade or profession
of movie producing, and that their negative response to his application for Best Picture producer credit did
not significantly impair his ability to work.” (Emphasis in the original.) All the Guild and Academy did “was
decide whether Yari met their criteria for receiving one of their awards. There is no judicial review of that
decision, even if the winner will benefit from receiving the award, and the losing nominees will suffer by
comparison.”
The Court of Appeal also rejected Mr. Yari’s argument that close judicial oversight over the way the
Academy and Guild applied their rules was warranted because, as in other organizations whose rules the
courts have scrutinized, these organizations “operate in the public interest.” Not quite, said the Court. The
Court acknowledged that the movie industry is important, movies “affect the ways in which people view the
world,” and that it is “surely true that, as Yari argues, the public is interested in the motion picture industry.”
That does not mean, however, “that [movie] industry related organizations . . . operate in the public interest”
the way, say, medical organizations do.
Something to think about as you enjoy the Emmy you received. Or didn’t.
Dan Eaton serves as Chair of the NATAS-PSW Legal Committee. He is a partner at the San Diego law firm
of Seltzer Caplan McMahon Vitek, where his practice focuses on employment law, and on-air legal analyst
for Fox 6 News. You may contact Dan at eaton@scmv.com. The views expressed are his own.
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