For Attorneys
    For the Public
    About Us
    Counsel For Justice
    Law Students
    My Account

LACBA on Facebook.
LACBA on Twitter.
LACBA on LinkedIn.


Table of Contents    Cover    MCLE Test

MCLE Article and Self-Assessment Test

In the Line of Fire

The apparently widespread practice of inducing entertainers to dismiss their business representatives can result in tortious interference claims.  

By Edwin F. McPherson

Edwin F. McPherson is a member of the entertainment and sports litigation firm of McPherson & Kalmansohn in Century City. He also is a certified NFL player's agent.

Agents, personal managers, business managers, and lawyers in the entertainment and sports industries ultimately separate into two groups: those that already represent certain clients, and those that want to be representing the same clients. For the first group, there are two important challenges: how to keep their clients, and what to do when (not if) those clients are enticed away. 

The first task is easy. Representatives need only make sure that they perform an exemplary job for their clients. Beyond that, agents and other representatives simply should ensure that their clients: 

  • Earn several million dollars a year.    
  • Never consult with their other representatives.    
  • Never speak or meet with any potential representatives that are trying to lure them away.    
  • Never so much as converse with any of their friends (particularly those who are making more money).    
  • Never speak to their spouses or other family members.
Representatives who do an outstanding job for their clients and master the other requirements are almost guaranteed to keep their clients--at least for a while. Face it, "loyalty" is a word with which few of today's artists, actors, or athletes are even remotely familiar.

There are untold hundreds of unscrupulous would-be representatives out there, eager to pounce on clients. Of all the potential representatives in the entertainment industry, the only profession (at least in California) with a code of conduct that prohibits the active solicitation of clients is the legal profession, and that code (the Rules of Professional Conduct) is often broken, or at least circumvented, with respect to client solicitation. The manager, upon first being retained by a new client, might tend to do some immediate housecleaning by firing the existing lawyer (or agent, business manager, publicist, or promoter) and assembling the manager's usual team. It is increasingly common to see three or four artists with the same personal manager, business manager, agent, and/or lawyer. This sense of harmony, however, often precludes the normal system of checks and balances that is so crucial to the entertainment and sports industries. The team system virtually guarantees that an agent's (or a lawyer's or a manager's) actions will go virtually unscrutinized by anyone, even though it would generally be the responsibility of each representative to police the actions of the others and otherwise ensure that no one (including the other representatives) takes advantage of the artist or athlete. 

Of course, housecleaning is not only the province of personal managers. However, because of the close relationship between personal managers and their clients, they are more likely to have this kind of influence over their clients. And because of the nature of their function as a personal manager, they are also much more likely to exert that sort of influence. 

While the debate on whether the team approach is good or bad for the artist goes on, it is clear that housecleaning is never good for the replaced representative. When a representative is terminated without cause and replaced by another, can the terminated party do anything about it? The answer to this question, like so many other legal dilemmas, is, "it depends." Under certain circumstances, the aggrieved former representative can sue for tortious interference with contract and/or tortious interference with economic advantage. 

The tort of interference with contract is a species of the broader tort of interference with prospective economic advantage.[1] The only material difference between the two causes of action is the existence of an actual agreement between two or more parties. The noncontractual relationship, though likely to be profitable and thus to the economic advantage of the parties (particularly the complaining party), has not risen to the level of a contractual one.[2] 

In order to establish the claim of tortious interference with contract, the plaintiff must plead and prove: 

  1. The existence of a valid contract between the complainant and some third party.    
  2. Knowledge by the interfering party of the existence of that contract.    
  3. Intentional or negligent acts by the interfering party designed to induce the third party to breach the contractual relationship with the complainant.    
  4. Actual breach or disruption of the contractual relationship.    
  5. Damages proximately caused by the interfering party's acts.[3]

The proof requirements for tortious interference with prospective economic advantage are similar, except that, instead of an existing contract, there is an economic relationship between the complainant and some third person containing the probability of future economic benefit to the complainant.[4] So even with respect to tortious interference with economic advantage, there must be an actual relationship. A would-be agent could not legitimately claim that he or she was about to approach an actor about representation and that the potential defendant interfered with this attempt. But the agent can claim that he or she was in the process of ongoing discussions or negotiations with the actor that had not yet resulted in a formal contract, and the interfering party disrupted that relationship. The agent can also claim that although no contracts had been signed and there was no set term of engagement, the agent was already performing agency services and was expecting (or had even received) a commission for those efforts. 

Clearly, in circumstances where one of the artist's representatives or a family member or the new representative precipitates the termination, the elements of tortious interference are all there: 

  • There is an existing agreement (albeit generally oral) or at least an economic relationship between the artist and the representative.    
  • The interfering party generally knows of this agreement and/or relationship.    
  • The intent underlying the conduct of that party usually is not difficult to ascertain.    
  • The disruption of the relationship is similarly easy to demonstrate. Plus the damages are obvious: add up the client's gross income, and divide by 10 (or other appropriate percentage).

To be actionable, the alleged conduct (in either a contract or economic-advantage situation) by the interfering party must be either "wrongful"[5] or "unlawful"[6]; or the actions can be lawful, but without sufficient "justification" or "privilege."[7] No liability will arise in either case where the interfering party's conduct consists solely of something that the party had an absolute and unequivocal right to do.[8] The "manager's privilege"[9] is the most notable instance in which all of the elements of a tortious interference claim might be present but the interfering party might be able to avoid liability due to justification or privilege. Essentially the manager's privilege provides that a business representative may induce his or her principal to breach a contract--an inducement otherwise actionable in tort--if the representative reasonably believes that compliance with the agreement would be harmful to the principal's best interests.[10] 

The word "manager" in "manager's privilege" has applied traditionally to an employee of a corporation (as opposed to an outside representative) who has a management function and is acting on behalf of (and presumably for the benefit of) the corporation. Strictly speaking, the privilege has not referred to entertainment managers. However, the definition of "manager" in this context has been broadened to include "agents" and "business advisors" of the breaching party, which of course would include talent agents, personal managers, and other artist representatives.[11] 

Like any privilege, the manager's privilege is an affirmative defense rather than a required element of a complainant's case-in-chief. Thus the defendant interfering party bears the burden of proof to plead and prove that his or her actions were, in fact, privileged.[12] If the privilege is not expressly asserted as an affirmative defense in the interfering party's answer to the complaint, the defense will be deemed waived and therefore lost forever.[13] 

The most fundamental rule regarding the manager's privilege is that the client or principal must be the breaching party as well as the one whom the manager (or agent or lawyer) induces to breach the contract with some third party. Klein v. Oakland Raiders, Ltd.[14] is a case in point. Eugene Klein, the president and sole general partner of the San Diego Chargers football team, brought suit against the Oakland Raiders football team and Allen Davis, the Raiders' managing general partner, for malicious prosecution. The underlying suit was brought by Davis and the Raiders against all of the NFL teams and certain individuals, including Klein, for, among other things, tortious interference and conspiracy. Davis and the Raiders claimed that Klein was one of the three "principal conspirators" who used the NFL rules "to further their own anticompetitive plans." The court of appeals reversed the lower court's decision, vacated the verdict, and instructed the trial court to enter a judgment in favor of the Raiders and Davis. The court held, as a matter of law, that there was probable cause for both parties to sue Klein, and that the manager's privilege did not apply. The court reasoned that although Klein might be considered to be a "manager" within the meaning of the term "manager's privilege," the entity that he managed was the San Diego Chargers, and not anyone with whom the Raiders or Davis had a direct contractual or other economic relationship. 

Klein argued that the privilege applied to his activities as a Chargers officer seeking only to enforce the NFL constitution and bylaws signed by the Chargers--not Klein individually. However, the court held that in order for the privilege to apply, the relationship must be with a breaching party. Klein did not induce the Chargers to breach some agreement with the Raiders, Davis, or anyone else. On the contrary, the Raiders alleged that Klein induced the Chargers to interfere with the Raiders' contract and/or relationship with a third party, the Coliseum Commission. Whether or not he was acting in the Chargers' best interest, Klein was potentially just as liable for tortious interference as the Chargers organization. The Klein court further noted that: 

Where neither the employer nor his employee is a party to the contract with which the employee is interfering, there is no privilege. It is one thing for an employee to deal with his employer's contracts but quite another for him to reach out and meddle with contracts to which his employer has no rightful interest.[15]

In order for the manager's privilege to apply, the manager or agent must have advised his or her principal to breach a contract with a third party because the manager or agent reasonably believed that the contract would be contrary to the principal's best interests.[16] Thus the privilege is far from absolute.[17] In fact, Aalgaard v. Merchants Nat. Bank, Inc.[18] mandates that in order for the privilege to be invoked, managers or agents must prove that they did not act out of their own self-interest and did not personally benefit from the decision. Other cases similarly are consistent in finding the privilege only when the motivation behind the interference is not selfish. 

Thus, in accordance with Aalgaard and other cases, it is not enough for someone simply to hold the position of a personal manager or agent in order to escape liability for what would otherwise be a tortious interference with contract.[19] When a manager discharges a lawyer or a business manager on behalf of an artist, and the discharged party later sues the manager, the manager must prove not only that he or she held the position of manager at the time of discharge but also that the purpose for the discharge was not a selfish one, and the discharge was in the artist's best interests.[20] 

An agent, for example, cannot interfere with an actor's contract with the actor's personal manager merely so that the agent can then fill the void by taking over the duties of the personal manager, and thus earn a higher commission.[21] Similarly, it is not just the Labor Code that precludes a manager from taking over the duties of an agent that was discharged by the manager or at the manager's behest.[22] 

Thus, despite the relationship between or among the parties, improper means will trump the privilege. As the court stated in Culcal Stylco, Inc. v. Vornado, Inc.23: "[o]ne who has a financial interest in the business of another is privileged purposely to cause him not to perform a contract with a third personÉif the actor (a) does not employ improper means, and (b) acts to protect his interest from being prejudiced by the contract...."[24] Restatement (Second) of Torts sets forth several factors to consider in finding improper interference with a contract: 

(a) the nature of the actor's conduct; (b) the actor's motive; (c) the interests of the other with which the actor's conduct interferes; (d) the interests sought to be advanced by the actor; (e) the social interests in protecting the freedom of action of the actor and the contractual interests of the other; (f) the proximity or remoteness of the actor's conduct to the interference; and (g) the relations between the parties.
Boiled down to its essence, the issue of the existence of the privilege turns on whether or not the interfering party's conduct was fair and reasonable under the circumstances.[25] Courts have held that the trier of fact makes this determination.[26]

Many defendants (at least at the trial court level) cite Culcal[27] as authority for the applicability of the fair-and-reasonable defense on demurrer but ignore the very language in that case that suggests that this defense is completely unavailable to the interfering party at the pleading stage absent very stringent requirements, which are all but impossible to meet. 

The Culcal court made it clear that the availability of the defense is always a question of fact: 

[The defense is] at most a qualified one dependent for its existence upon the circumstances of the case. It is essentially a state-of-mind privilege and therefore its existence cannot normally be determined on the basis of pleadings alone.[28]
Similarly, in a tortious interference claim against individual officers/directors of a corporation, the court in Collins v. Vickter Manor, Inc[.29] noted that whether a particular action alleged to be in the "best interests of the corporation" is privileged "is a matter of defense, to be decided by a resolution of the factual issues presumptively involved"--and thus improper to resolve on demurrer.[30]

Courts have been in conflict on the issue of how much personal financial interest will be allowed before an interfering party loses his or her privilege. In Los Angeles Airways, Inc. v. Davis,[31] the court seems to indicate that some interest in benefiting one's principal (notwithstanding the existence of a substantial amount of self-interest) is sufficient: "where, as here, an advisor is motivated in part by a desire to benefit his principal, his conduct in inducing a breach of contract should be privileged."[32] 

Probably the most logical rule provided by other courts, given the nature of the defense, is that more than just some altruistic interest is necessary. Other courts have so held. The Culcal[33] court stated that the privilege is qualified, not absolute, and dependent upon the defendant's state of mind. The court further held that "the issue turns on the defendant's predominant purpose in inducing the breach of the contract."[34] There is also a requirement that "one inducing a breach in order to protect a financial interest must do so in good faith."[35] Environmental Planning and Info. Council v. Superior Court,[36] and even more recently in Pacific Gas & Elec. Co. v. Bear Stearns & Co.,[37] "[w]hen the defendant's action does not interfere with the performance of existing contracts, the range of acceptable justification is broader...." 

Many representatives in the entertainment and sports industries have complained for years that their most ardent adversaries are the husbands or wives of their clients. All too often, spouses with little understanding of the complexities and intricacies of business management will decide that their breadwinners should not continue to pay out 5 percent of their hard-earned salary, year after year, to a business manager, when the nonartist/athlete spouse could pay the bills gratis. 

Such spouses are no more immune to the laws of tortious interference than anyone else. It is quite clear that the husband-and-wife relationship alone does not provide automatic insulation from liability. Although there are a plethora of decisions that document the existence of the justification and/or privilege defense to an intentional or negligent inducement claim, none of them expressly or impliedly extends an absolute defense to the relationship between husband and wife. In fact, California courts do not readily embrace attempts to use the existence of a special relationship as a shield for a defendant's "own self-serving interference with the contract."[38] 

Together, two authorities make it clear that the existence of a husband-and-wife relationship does not automatically protect either party from liability for interfering with the other's contractual relations with a third party--especially when the interference is premised upon the interfering party's own self-interest, as opposed to his or her interest in protecting the welfare of the other party. The court in Rosenfeld, Meyer & Susman v. Cohen[39] cites Abrams & Fox, Inc. v. Birney,[40] in which the defendant, the former husband, claimed that he had an absolute right to interfere with the contract between his wife and the plaintiff, who was acting as his wife's divorce attorney in connection with their own marital dissolution proceedings. The court refused to find, as a matter of law, that the interfering defendant's conduct was privileged, stating that: 

Whether [the] defendant's conduct was privileged or justified depends upon a careful balancing of the importance of the objective advanced by the interference against the importance of the interest interfered with, considering all the circumstances including the nature of the actor's conduct and the relationship between the parties. These are affirmative defenses and are usually established by proof of facts rather than pleadings.[41]

These issues thus generally preclude the imposition of summary judgment. The angry husband that tells his wife to fire her personal manager because he and the personal manager do not get along may very well find himself on the wrong end of a tortious interference suit and will almost always have to wait until trial to establish his defense of privilege (which, in that situation, may be very difficult to establish). 

The enforceability of the underlying agreement is irrelevant. Even an at-will agreement may be the subject of a tortious interference claim, and the at-will designation of the employment or other agreement does not render an otherwise actionable interference somehow privileged. For instance, many entertainment industry professionals who have been sued for tortious interference have argued that they should not be held liable because the agreement between their client and the third party did not specify a definite term. In fact, many representative agreements in the entertainment industry, from managers to agents to business managers to lawyers, are oral and/or do not have a definite term, whether or not such agreements are enforceable.[42] If an agreement, oral or otherwise, does not have a definite term, the relationship is considered to be at the will of both parties. 

In the watershed decision of Speegle v. Board of Fire Underwriters,[43] the California Supreme Court noted that an at-will agreement can be interfered with in the same manner as an agreement with a definite term: 

Recognizing that the fact that a contract is "at the will of the parties, respectively, does not make it one at the will of others," the great majority of cases have held that unjustifiable interference with contracts terminable at will is actionable....[44]

Similarly, in Kozlowsky v. Westminster Nat. Bank,[45] the court made it clear that the at-will nature of an agreement is completely irrelevant to the issue of whether or not a third party has interfered with that agreement. The Kozlowsky court held that the crux of the tort is not the nature of the underlying contract but the act of interference with the relationship. The court noted that "[t]he actionable wrong lies in the inducement to break the contract or to sever the relationship, not in the kind of contract or relationship so disrupted, whether it is written or oral, enforceable or not enforceable."[46] 

Applying Kozlowsky to entertainment relationships, if a personal management agreement is ultimately declared to be unenforceable and/or void by the California Labor Commissioner,[47] a third party who interferes with that agreement still may be held liable in tort for that interference even when the claimant could not have recovered against the breaching party for the breach. 

Until very recently, artists and athletes themselves were not immune to the harsh realities of the law of tortious interference. The issue was first addressed in Wise v. Southern Pac. Co.,[48] when the court noted the clear mandate from the California Supreme Court that a party to a contract could not be held liable for tortiously interfering with his or her own contract. However, the Wise court did hold that a party to a contract could be held liable for a civil conspiracy to interfere (tortiously) with his or her own contract.[49] 

The Wise decision remained the law in California for the next 30 years. The case was accepted and applied in numerous subsequent appellate decisions.[50] However, in March 1994, Wise was finally rejected by the California Supreme Court. In Applied Equipment Corp. v. Litton Saudi Arabia Ltd.,[51] the supreme court reversed field and expressly held that a party to a contract, as a matter of law, cannot be held liable for conspiracy to interfere with his or her own contract. A party cannot be held liable for a conspiracy to do something that he or she is legally entitled to do. Since a party to a contract cannot be held liable for interference with the party's own contract, it is equally clear, according to Applied Equipment, that he or she also cannot be held liable for conspiring to interfere with that contract. 

The court, in a lengthy discussion about the differences between contract law and tort law, noted that "[c]ontract law exists to enforce legally binding agreements between parties; tort law is designed to vindicate social policy."[55] Applied Equipment contains a review of the ample authority that limits contract plaintiffs to recovering damages that were reasonably foreseeable at the time of the making of the contract--and these are usually not for emotional distress and never for punitive damages. The court also observed that while the motivation of a tortfeasor defendant is extremely important, "the law generally does not distinguish between good and bad motives for breaching a contract."[56] 

The court essentially found it intolerable that in literally every tortious interference case, by definition, the third party seeking to induce a breach would communicate directly with the contracting party; and then the party who was induced to breach the contract might be sued and ultimately held liable for conspiring with that outsider. The court expressly disapproved "all prior cases to the extent they hold that a party to a contract can be held liable in tort based on a conspiracy to interfere with its own contract" and indicated a nonexhaustive list of such cases.[57] 

Critics say that a commissioned representative only can make money if the artist or athlete makes money and, therefore, all efforts to make money by the representative, even if unchecked by other representatives, are per se beneficial to that artist or athlete. However, such a position ignores the realities of the entertainment and sports industries. 

Some managers and agents routinely frontload their clients' deals or otherwise structure the deals so that the representative will receive large commissions at or near the inception of the deal, notwithstanding that it may be much more beneficial for the artist to be paid over a long period of time or to receive more money on the back end. This frontloading not only ensures that the representative will not have to wait for his or her commissions but also that he or she will receive all of the commissions on that proj-ect--even if the representative resigns the day after the deal is made.[58] 

The interfering conduct of outsiders who have no previous relationship with the artist or athlete is going to be much more harshly scrutinized by a judge or jury, as those individuals arguably do not have any right whatsoever to assert a privilege or some other justification in their defense. As long as all of the elements of an interference claim exist, the outsider will be held liable, and the only question will be the amount of damages

  1. Aalgaard v. Merchants Nat. Bank, Inc., 224 Cal. App. 3d 674, 274 Cal. Rptr. 81 (1990); Shapoff v. Scull, 222 Cal. App. 3d 1457, 1464, 272 Cal. Rptr. 480 (1990); Dryden v. Tri-Valley Growers, 65 Cal. App. 3d 990, 994, 135 Cal. Rptr. 720 (1977).    
  2. See supra note 1. Personal managers often work without a formal, binding contract with their artist, but they rely on custom and practice in the industry to determine the 15 percent commission for their work on the artist's behalf.    
  3. Pacific Gas & Elec. Co. v. Bear Stearns & Co., 50 Cal. 3d 1118, 1126, 791 P. 2d 587, 270 Cal. Rptr. 1 (1990); Shapoff, 222 Cal. App. 3d at 1464-65; Dryden, 65 Cal. App. 3d at 994; Contemporary Investments, Inc. v. Safeco Title Ins. Co., 145 Cal. App. 3d 999, 1002, 193 Cal. Rptr. 822 (1983); Mayes v. Sturdy Northern Sales, Inc., 91 Cal. App. 3d 69, 78, 154 Cal. Rptr. 43 (1979); Buckaloo v. Johnson, 14 Cal. 3d 815, 827, 537 P. 2d 865, 122 Cal. Rptr. 745 (1975); 3 B. WITKIN, CAL. PROCEDURE, Pleading Section630, at 2259 (2d ed. 1971).    
  4. Buckaloo, 14 Cal. 3d at 827.    
  5. Rickel v. Schwinn Bicycle Co., 144 Cal. App. 3d 648, 658, 192 Cal. Rptr. 732 (1983).    
  6. Aalgaard, 224 Cal. App. 3d at 683.    
  7. Id. See also Herron v. State Farm Mut. Ins. Co., 56 Cal. 2d 202, 363 P. 2d 310, 14 Cal. Rptr. 294 (1961); Lowell v. Mother's Cake and Cookie Co., 79 Cal. App. 3d 13, 18, 144 Cal. Rptr. 664 (1978).    
  8. Caldwell v. Gem Packing Co., 52 Cal. App. 2d 80, 125 P. 2d 901 (1942). See also RESTATEMENT (SECOND) OF TORTS Section773 (privilege for good faith assertion of legally protected interest).    
  9. Other forms of justification may include interfering with a contract for which "enforcementÉwould be injurious to health, safety, or good morals" or the "interest of labor in improving working conditionsÉ." See Olivet v. Frischling, 104 Cal. App. 3d 831, 841, 164 Cal. Rptr. 87 (1980), quoting Imperial Ice Co. v. Rossier, 18 Cal. 2d 33, 35-36, 112 P. 2d 631 (1941).    
  10. Aalgaard, 224 Cal. App. 3d at 684, quoting Olivet, 104 Cal. App. 3d at 840-41. See also Los Angeles Airways, Inc. v. Davis, 687 F. 2d 321 (9th Cir. 1982); 3 LEVY, ET AL., CAL. TORTS, Business Torts Section40.119[3], at 40-165 to 40-166 (1990 ed.); Klein v. Oakland Raiders, Ltd., 211 Cal. App. 3d 67, 259 Cal. Rptr. 149 (1989).    
  11. Aalgaard, 224 Cal. App. 3d at 686.    
  12. Id. at 683, citing H & M Assoc. v. City of El Centro, 109 Cal. App. 3d 399, 405, 167 Cal. Rptr. 392 (1980).    
  13. Mayes, 91 Cal. App. 3d at 80; CODE CIV. PROC. Section431.20; 3 B. WITKIN, CAL. PROCEDURE, Pleading Section926, at 2510-11.    
  14. Klein, 211 Cal. App. 3d 67.    
  15. Id. at 81, quoting Gamer, The Agent's Privilege to Interfere Intentionally with Contractual Relations: A Reappraisal of California Law, 12 CAL. WESTERN L. REV. 475, 484 (1976).    
  16. See supra note 15.    
  17. Id. ("Nevertheless, there are a number of authorities which seem to suggest, without much analysis, that it is an absolute privilege."). See, e.g., Lawless v. Brotherhood of Painters, 143 Cal. App. 2d 474, 478, 300 P. 2d 159 (1956); Mallard v. Boring, 182 Cal. App. 2d 390, 393-94, 6 Cal. Rptr. 171 (1960).    
  18. Aalgaard, 224 Cal. App. 3d 674.    
  19. Aalgaard, 224 Cal. App. 3d at 685 ("It should be clear from [the] cases that the privilege should not be based merely upon a defendant's position with respect to the breaching party but upon the defendant's purpose in inducing the breach."). Id., citing Rosenfeld, Meyer & Susman v. Cohen, 146 Cal. App. 3d 200, 227-230, 194 Cal. Rptr. 180 (1983) ("the privilege is qualified and not absolute"); Los Angeles Airways, 687 F. 2d 321; McCabe v. General Foods Corp., 811 F. 2d 1336, 1339 (9th Cir. 1987); Olivet, 104 Cal. App. 3d at 841.    
  20. Aalgard, 224 Cal. App. 3d 674; Rosenfeld, Meyer & Susman, 146 Cal. App. 3d 200; Los Angeles Airways, 687 F. 2d 321; McCabe, 811 F. 2d at 1339; Olivet, 104 Cal. App. 3d at 841.    
  21. See Olivet, 104 Cal. App. 3d at 841.    
  22. While agent's commissions generally are 10 percent and are regulated by the various guilds, there is no such regulation of personal manager's commissions, which generally are 15 percent to 20 percent. Technically, however, a franchised talent agent cannot simply put on a personal manager's hat and collect an additional commission (if the agent wants to stay franchised).    
  23. Culcal Stylco, Inc. v. Vornado, Inc., 26 Cal. App. 3d 879, 103 Cal. Rptr. 419 (1972).    
  24. Id., 26 Cal. App. 3d at 882, citing RESTATEMENT OF TORTS Section769 (1939) as proposed for revision in tentative draft No. 14 (1969).    
  25. Rosenfeld, Meyer & Susman, 146 Cal. App. 3d at 230; RESTATEMENT (SECOND) OF TORTS Section767, cmt. d.; Herron, 56 Cal. 2d at 206; Lowell, 79 Cal. App. 3d at 21.    
  26. Rosenfeld, Meyer & Susman, 146 Cal. App. 3d at 230; H & M Assoc., 109 Cal. App. 3d at 409.    
  27. Culcal, 26 Cal. App. 3d 879.    
  28. Id. at 883. See also Rosenfeld, Meyer & Susman, 146 Cal. App. 3d at 230; Lowell, 79 Cal. App. 3d at 22; Herron, 56 Cal. 2d at 207; H & M Assoc., 109 Cal. App. 3d at 409; Richardson v. La Rancherita, 98 Cal. App. 3d 73, 80-81, 159 Cal. Rptr. 285 (1979); Greenburg v. Hollywood Turf Club, 7 Cal. App. 3d 968, 977-78, 86 Cal. Rptr. 885 (1970); Kozlowsky v. Westminster Nat. Bank, 6 Cal. App. 3d 593, 86 Cal. Rptr. 52 (1970).    
  29. Collins v. Vickter Manor, Inc., 47 Cal. 2d 875, 883, 306 P. 2d 783 (1957).    
  30. Id., 47 Cal. 2d at 883.    
  31. Los Angeles Airways, 687 F. 2d at 328.    
  32. Id.; see also Aalgaard, 224 Cal. App. 3d at 686.    
  33. Culcal, 26 Cal. App. 3d 879.    
  34. Id. See also Sade Shoe Co. v. Oschin & Snyder, 162 Cal. App. 3d 1174, 1181, 209 Cal. Rptr. 124 (1984); Mayes, 91 Cal. App. 3d at 79; PROSSER, PROSSER ON TORTS Section129, at 943 (4th ed. 1971).    
  35. Richardson, 98 Cal. App. 3d at 80-81. See also RESTATEMENT (SECOND) OF TORTS SectionSection767-73, at 26-52.    
  36. Environmental Planning and Info. Council v. Superior Court, 36 Cal. 3d 188, 194, 680 P. 2d 1080, 203 Cal. Rptr. 127 (1984).    
  37. Pacific Gas & Elec. Co. v. Bear Stearns & Co., 50 Cal. 3d 1118.    
  38. See, e.g., Lowell, 79 Cal. App. 3d 13.    
  39. Rosenfeld, Meyer & Susman, 146 Cal. App. 3d at 22-23.    
  40. Abrams & Fox, Inc. v. Birney, 39 Cal. App. 3d 604, 609 (1974).    
  41. Id. at 609-10. See also Mayes, Inc., 91 Cal. App. 3d at 79; A. F. Arnold & Co. v. Pacific Professional Ins. Inc., 27 Cal. App. 3d 710, 714-15, 104 Cal. Rptr. 96 (1972).    
  42. See Talent Agencies Act, LAB. CODE Section1700.23; CAL. CODE OF REGS, tit. 8, ch. 6, gr. 3, art. 6, Section12002. See also Frank Beverly v. Mariano Raymundo, Labor Commission Case No. SF MP 41, 6:5-19(1979); International Creative Management v. Debbie Reynolds, Labor Commission Case No. LA 220-CVW, 3:21-27, 4:13-16 (1982) ("It is clear from the [a]dministrative regulation that before an [agent] can recover a fee for his services in procuring employment for an artist under an oral contract, he must confirm in writing within 72 hours, the employment found for the artist....The letters that alleged to be confirmations did not contain the full terms of the oral agreements, thus failing to fulfil the requirements set forth in the [CAL. CODE OF REGS.]"; Professional Artists Management v. Roger Peltz, Labor Commission Case No. TAC 12-79 (1990) (similarly holding that the agent was owed nothing because the oral agreement was not confirmed in writing within 72 hours).   

    However, this rule does not apply to personal managers, who are not generally licensed as talent agents with the state. There is no such licensing procedure for personal managers, and therefore no such restrictions. See generally Edwin F. McPherson, The Talent Agencies Act--A Personal Manager's Nightmare, LOS ANGELES LAWYER, May 1994, at 17.   

    See also BUS. & PROF. CODE Section6148 (enforceability of an oral agreement with an attorney). 

  43. Speegle v. Board of Fire Underwriters, 29 Cal. 2d 34, 172 P. 867 (1946).    
  44. Id., 29 Cal. 2d at 39, citing Hitchman Coal & Coke Co. v. Mitchell, 245 U.S. 229, 38 S. Ct. 65, 62 L. Ed. 260 (1917). See also Abrams & Fox, 39 Cal. App. 3d 604 (and cases cited therein); Pacific Gas & Elec. Co., 50 Cal. 3d at 1128.    
  45. Kozlowsky, 6 Cal. App. 3d 593.    
  46. Id. at 598.    
  47. See LAB. CODE SectionSection4600, et seq.    
  48. Wise v. Southern Pac. Co., 223 Cal. App. 2d 50, 35 Cal. Rptr. 652 (1963).    
  49. Id., 223 Cal. App. 2d at 65.    
  50. See, e.g., Shapoff, 222 Cal. App. 3d at 1465; Manor Investment Co. v. F. W. Woolworth, 159 Cal. App. 3d 586, 594, 206 Cal. Rptr. 37 (1984); Rosenfeld, Meyer & Susman, 146 Cal. App. 3d at 226; Owens v. Palos Verdes Monaco, 142 Cal. App. 3d 855, 872, 191 Cal. Rptr. 381 (1983); Owens v. Foundation for Ocean Research, 107 Cal. App. 3d 179, 185, 165 Cal. Rptr. 571 (1980); Olivet, 104 Cal. App. 3d at 831; Mayes, 91 Cal. App. 3d at 77-78; Wetherton v. Growers Farm Labor Assn., 275 Cal. App. 2d 168, 176-77, 79 Cal. Rptr. 543 (1969).    
  51. Applied Equipment Corp. v. Litton Saudi Arabia Ltd., 7 Cal. 4th 503, 869 P. 2d 454, 28 Cal. Rptr. 2d 475 (1994).    
  52. Id., citing Doctors' Co. v. Superior Court, 49 Cal. 3d 39, 44, 775 P. 2d 508, 260 Cal. Rptr. 183 (1989), quoting Unruh v. Truck Ins. Exchange, 7 Cal. 3d 616, 631, 498 P. 2d 1063, 102 Cal. Rptr. 815 (1972).    
  53. Note, Civil Conspiracy and Interference with Contractual Relations, 8 LOYOLA L.A. L. REV. 302, 308, n.28 (1975).    
  54. Applied Equipment, 7 Cal. 4th at 511.    
  55. Id. at 514, citing Foley v. Interactive Data Corp., 47 Cal. 3d 654, 683, 765 P. 2d 373, 254 Cal. Rptr. 211 (1988).    
  56. Applied Equipment, 7 Cal. 4th at 516. See also Harris v. Atlantic Richfield Co., 14 Cal. App. 4th 70, 82, 17 Cal. Rptr. 649 (1993) ("The imposition of tort remedies for 'bad' breaches of commercial contracts is a substantial deviation from the traditional approach which was blind to the motive for the breach.").    
  57. Shapoff, 222 Cal. App. 3d 1457; Manor Investment Co., 159 Cal. App. 3d 586; Rosenfeld, Meyer & Susman, 146 Cal. App. 3d 200; Owens, 142 Cal. App. 3d 855; Owens v. Foundation for Ocean Research, 107 Cal. App. 3d 179; Olivet, 104 Cal. App. 3d 831; Mayes, 91 Cal. App. 3d 69; Wetherton, 275 Cal. App. 2d 168.    
  58. Although talent agents and sports agents usually are protected on these commissions, there generally is no such protection in the music industry for a personal manager who does not have a written agreement with the artist ensuring the manager an entitlement to "continuing commissions" after the manager's termination.

EARN CLE CREDIT  By reading this article and answering the accompanying test questions, you can earn one CLE credit.


Los Angeles Lawyer
General Information
Online MCLE
Plus: Earn MCLE Credit