I just got off a conference call sponsored by RBC Capital Markets with Jonathan Handel, an entertainment lawyer at TroyGould in Los Angeles and blogger at Digital Media Law.
You can hear a replay of the call and the Q/A at 416-620-5683 or 800-558-5253. The pin is 21405650.
Jonathan argues that a strike by SAG is highly likely and all but inevitable if SAG secures the 75% threshold for a strike authorization. I had resisted agreeing with him until I heard him out today and then considered a couple of other factors.
Jonathan argues that Membership First will be able to use union resources to send out biased material to the membership that will lead to a 75% majority necessary to grant the SAG National Board authorization to call a strike.
Then SAG will ask the producers to roll over and play dead. Instead, Nick Counter will bare his teeth and growl and yank on the leash held by Iger, Murdoch, Chernin, et al.
So then what?
Well, technically, the National Board has to cast a majority vote in favor of an actual walk out. But Membership First no longer has a majority so how will it get a favorable vote?
Jonathan’s argument is that Membership First will, in essence, successfully twist the arm of the LA-based group that holds the swing votes on the board – the new slate Unite For Strength. MF will threaten to use a vote against a strike by UFS against them in the fall Presidential elections.
It is widely thought that Anne Marie Johnson, a controversial figure who has a base of support in Membership First, will step up to run when Alan Rosenberg steps down. Unite For Strength would likely run Ned Vaughn, who led their slate in the recent elections and secured an alternate position on the National Board.
Unite For Strength is thought to be opposed to a strike but they have not been in the vanguard of the opposition, leaving that to veterans on the NY board and to newly active A-listers like Alec Baldwin (who was at town hall meetings in NY and LA this week).
The only problem for UFS is that if MF gets to call a strike and they win a face saving victory (an unlikely outcome that I will discuss in a minute) then they can wave that flag of success into the fall elections and UFS will have handed their opponents a real weapon.
Now, that’s basically Jonathan’s view and it makes a certain amount of sense. Here is the other factor playing into this situation: Doug Allen. Allen is an experienced union bureaucrat. He served as the number 2 to Gene Upshaw at the Football Players for 20 years. Upshaw was one of the most notorious self-interested union officials in American labor history. Before his untimely death he was subject to numerous Congressional investigations related to mismanagement of the Players Association drawing the ire even of Cong. Maxine Waters.
As a recent federal trial proved, he and Allen (and Allen’s wife) ran a corporate subsidiary of the union called Players Inc. that engaged in a sophisticated multi-million dollar fraud against the union’s own retired members that enabled Upshaw and the Allens to pay themselves huge salaries and benefits.
Upshaw was being paid $6 million a year and the Allens together approximately $750,000 a year, in part based on licensing fees earned from the deals he and the Allens negotiated with the entertainment industry. In others words these union officials were being paid the equivalent of residuals that would otherwise have gone to the players themselves – including many of the so-called gridiron greats like Herb Adderley, one of the lead plaintiffs in the successful $28 million lawsuit.
(I took a certain pride in this case, since one of the attorneys for the retired players is a Santa Clara law grad.)
With that court decision now on his resume, Allen likely has no future in organized labor unless he makes SAG a success. He walked out on a plank with Membership First when he helped them put in place their “go it alone” strategy.
That forced the hand of the WGA into a tragic strike – tragic not because WGA did not do everything it could to make it a success, but tragic because the one big weapon that entertainment labor had going its way this round was used up prematurely.
It was the WGA that had to roll out the non-union new media issue. With SAG off starting useless battles with fellow guild AFTRA over a soap opera, WGA stood out in the cold and heat for 100 days (with many SAG members side by side with them it should be said) and secured some inroads for unionization of the new media environment. But not a dent in DVDs and some other major holes.
The problem now is that SAG has no clear and credible issue to win wider public support. New media jurisdiction, partial tho it is, has been established and now spread to every other guild and even the IA. SAG can strike for more but their powder is wet and the message limp.
Why then the drumbeat for a strike?
Membership First and Doug Allen both need a victory of any credible kind to save their collective behinds.
The likelihood, of course, is that both MF and Allen hope for what is known in labor as a strike that allows their militant base to “blow off steam.” Those kinds of strikes are relatively short, the employer offers a face saving sweetener to their last offer, the union caves and everyone goes back to work. That’s what the UAW did with regularity over the years. It’s a pretty good survival strategy for a well paid union bureaucracy.
Only one problem for Allen and MF: the strategy requires a compliant employer. And the AMPTP is not likely to go along with the script.
That leaves two possibilities: SAG must hit the Producers hard and fast right up front. But that would require hitting industry partners like WalMart or Best Buy in a DVD boycott or one of big film openers with a picket line. And, of course, there is always the Oscars.
However, that kind of action requires very very careful preparation over a period of months. No sign that that has been underway inside 5757 Wilshire.
The other possibility is a long drawn out strike that over months would inflict real damage to the production schedule. Again, that too takes preparation, including a strike fund, wide public and political support and solid support across the union membership. The WGA had all of those factors in place. SAG has none of those in place.
Thus, the survival dynamic gripping Membership First leaders at SAG and their National Executive Director is setting up the Guild for a major disaster.
Folks, this is a train wreck in slow motion….entertaining in only the most unfortunate sense. Perhaps someone from the WGA is already writing the screenplay.