Retainer Agreements: Los Angeles County Superior Court Invalidates Oral Entertainment “Handshake” Fee Contingency Deals Not In Writing

Case Involved Johnny Depp, And May Send Some Ripples Through Entertainment Industry.

            This next case, although only at a state superior court level, may send some shock waves on how entertainment agreements are structured between actors and their lawyers.

            What happened here is that Johnny Depp challenged millions of dollars paid out to attorney Jake Bloom over 18 years based on the fact they only had an oral “handshake” arrangement to represent the actor based on a percentage of the actor’s earnings. After Messrs. Depp and Bloom entangled into a dispute, Mr. Depp sought to recoup the fees based on the fact that it was an oral continency arrangement that needed to be in writing.

            Los Angeles County Superior Court Judge Terry Green agreed with Mr. Depp, finding it was a contingency arrangement which needed to be in writing.

           “There’s not a special rule for entertainment people,” Judge Green said Tuesday, August 28, 2018. “Why isn’t it in writing? Why not have something that memorializes the agreement so we don’t end up in court fighting like this?” Attorney Mr. Bloom’s attorney argued that the outcome was uncertain, could fluctuate wildly, and was based an equity interest in future movies.

However, Judge Green repeatedly stated that his relatives work in the entertainment business, so he has no particular hostility to it. But, he argued, the business should be bound by the same rules as everybody else. “I grew up in a showbiz family,” Judge Green said. “I am aware that showbiz people think they live in a different universe, but they don’t. They’re not a different universe.” Judge Green argued that the ups and downs of Depp’s career underscore the speculative nature of a fee arrangement based on his income.

“I don’t follow showbiz,” he said. “I rarely go to movies. I know who the plaintiff is. I can’t tell you a whole lot about him, except he’s had ups and downs in his career. Who would have known, 18 years ago, how high the highs are and how low the lows.”

We think there is likely to be an appeal on the ruling in this case, at some stage.