Chapter 248: Ovitz's Invitation

In front of the colossal Fox Group, CAA might not amount to much, but garnering such a formidable force's support was beneficial for my ascension and posed no harm. Moreover, CAA's projects had more successes than failures, so collaborating with them wasn't a bad thing at all. In fact, it could provide a strong external boost for the company.

For CAA, having a production department head from one of the Big Six movie companies, who was more inclined to work with them, would allow them to maintain, and even expand, their advantage in the industry amidst fierce competition.

Bill Roscis and Kara Fes's reactions were not beyond Murphy's expectations, especially CAA's stance. The agency had lost its dominance from the time Michael Ovitz was in charge, especially when dealing with the six major Hollywood studios, now corporate giants.

It should be noted that CAA's competitors weren't limited to other talent agencies but included individuals who had transitioned out of the entertainment agency business.

Murphy and Kara Fes left Bill Roscis's office and descended to the lobby of the Death Star building, where they were suddenly approached by such an individual.

"Hello, Director Stanton," a middle-aged man blocked Murphy and Kara Fes's path and introduced himself, "I am Mah-Draclayes from Artist Management Group, here with greetings from Mr. Michael Ovitz."

Hearing this renowned name, Murphy was somewhat surprised but remained composed and nodded, "Hello."

Mah-Draclayes glanced at Kara Fes and then said, "May we speak privately?"

Before Murphy could respond, Kara Fes spoke first, "Let's reschedule our dinner. I'll be leaving first."

Murphy nodded, "I'll call you another day."

Watching Kara Fes leave the Death Star building, Murphy then turned his attention to the man before him.

"Could we talk over there?" Mah-Draclayes gestured and led the way, with Murphy following. They found a quiet booth near the window on the second floor of the café. After ordering coffee, they observed each other.

Any Hollywood veteran knew of Michael Ovitz, a legend of the 80s and 90s. He founded CAA, an absolute behemoth in the talent agency world. Ovitz was known for his flexibility; he could both charm super-clients with his dance moves at the dinner table and aggressively invade the offices of CEOs from the Big Six studios.

The mid-90s marked a turning point in Ovitz's life and career. Aiming to become a true Hollywood mogul, he left CAA, the company he had built, for a shot at the CEO position at Walt Disney. However, he was unsuccessful, and Michael Eisner at Disney became his Waterloo.

After leaving Disney, Ovitz recognized his strengths and limitations and founded the Artist Management Group, returning to the entertainment agency industry.

Murphy deduced their purpose in seeking him out was straightforward: to poach him from CAA.

Indeed, Mah-Draclayes got straight to the point, "Director Stanton, Mr. Ovitz greatly admires your talent and sees potential in you. He sent me here to invite you to join the Artist Management Group."

"I am honored by Mr. Ovitz's appreciation and very flattered," Murphy politely replied, then tactfully declined, "I am very happy with my collaboration with CAA and have no plans to leave."

"You don't need to leave CAA," Mah-Draclayes quickly clarified upon seeing Murphy's puzzled look, "Joining Artist Management Group won't conflict with your position at CAA."

"Uh…" Murphy was confused. Since when did the Talent Agents Act allow being signed with two agencies simultaneously?

Seeing Murphy's misunderstanding, Mah-Draclayes hurriedly explained, "Artist Management Group has long abandoned agency business. We are now a management firm."

"I see," Murphy understood. Having been in Hollywood for years, he knew well the distinction between agents and managers.

In Hollywood, unlike the entertainment agency industry on the other side of the Pacific, agents and managers play distinct but complementary roles. According to California law and union rules, there's a clear division of rights between them. Agents secure work for clients, focusing on clinching as many employment deals as possible. Managers, however, plan and design their clients' career paths, offering career advice and recommendations on job opportunities provided by agents.

In simpler terms, agents provide job opportunities, while managers advise on which opportunities to accept.

"Director Stanton, we're not asking you to leave CAA," Mah-Draclayes said timely, "We just want to represent your management business, to plan a better career for you."

Murphy, not very familiar with the management industry, naturally didn't immediately agree or decline.

"I need to think about it," he said.

By his own judgment, having four agents at CAA, he probably didn't need a manager as well.

Moreover, considering the agents' commission, adding a manager would likely reduce his income by another five to ten percent.

Michael Ovitz's reputation was indeed impressive, but the Michael Ovitz of today was not the same as the Ovitz from CAA's heyday, and thus not as appealing.

Being sought after by Michael Ovitz was indeed an honor, even a bragging right, but fundamentally, it was a business deal. From any perspective, he should choose the more successful partner he currently had.

Leaving the café, Murphy thought it over and dialed Robert Downey Jr.'s number. An old hand in Hollywood and from a show business family, Downey Jr. would surely have a deeper understanding of the role of a manager.

Indeed, Downey Jr. had more insight into the industry than Murphy, a relatively new entrant.

He advised Murphy that if he was still with CAA, he didn't need a manager. Accepting a manager would likely soon lead to conflicts between the management and agency companies, forcing a choice between the two.

The reality was that managers, operating under the guise of management companies, were largely doing the work of agents. This conflict had changed from a complementary to a competitive relationship more than a decade ago.

Later, Downey Jr. came out for dinner with Murphy, specifically explaining the current state of this dynamic.

In Hollywood, any person or company engaged in or employed by film production or distribution, or holding any interest in a production or distribution company, cannot engage directly or indirectly in agency business or enjoy agency benefits, regardless of the person or company.

California's Talent Agents Act specifically regulates the entertainment agency industry. The act emphasizes that only licensed agents can secure work for industry professionals and includes provisions to protect them from exploitation in business practices. For instance, it prohibits agents from providing false or misleading information about work opportunities, sending clients to unsafe working conditions, employing "prostitutes, gamblers, alcoholics," providing illegal job opportunities to minorities, and sharing commissions with a client's employer.

The spirit of the law is to maintain and reinforce the distinction between agents and managers to protect clients' interests, stating, "No person shall engage in the occupation of a talent agent without first obtaining a license from the Labor Commissioner."

The law clearly states that representatives of industry professionals must first obtain an agent's license to secure work.

In other words, managers engaging in agent work is illegal. Artists can report to the Labor Commissioner and seek compensation, who

, upon verification, will cancel all contracts signed between the manager and their artists and confiscate the manager's illegal earnings from the past year.

Moreover, Hollywood's major unions also mandate that entertainment agents must be licensed by them.

Under the dual regulation of state law and industry regulations, agents in the entertainment agency business have become a privileged and heavily protected profession, but with strict restrictions.

For example, when Murphy first signed with CAA, the initial contract was for one year, with a renewal period of up to three years; agent commissions were capped at ten percent; agents were prohibited from producing or having any interest in their client's work, and from directly or indirectly enjoying any benefits from any film production or distribution company.

Conversely, any person or company involved in or employed by film production or distribution, or holding any interest in a production or distribution company, is prohibited from engaging directly or indirectly in agency business or enjoying agency benefits.

These strict limitations are designed to prevent "conflicts of interest," where agents secure jobs for their clients that are actually with employers they own. As agents, they are entrusted by clients to maximize benefits while seeking job opportunities. The commission system aligns their interests. However, if an agent is a producer, their goal is to minimize costs and maximize future profits, contrary to the agent's supposed objectives, resulting in a loss of benefits for the client.

"But you know, where there are interests, there is dispute," Downey Jr. put down his cutlery and looked at Murphy, "Regulations are static, but people are dynamic. Managers use these unspoken understandings to broadly encroach on the business belonging to agency companies."

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