SAG pension and health plans chief Bruce Dow resigns

Bruce Dow, the beleaguered chief executive of the Screen Actors Guild pension and health plans, has resigned.

Dow, who had been on a medical leave of absence since January, was expected to step down in the wake of a mounting controversy over a lack of financial control of an organization that controls more than $2 billion in assets on behalf of the Screen Actors Guild's 125,000-plus members.

The board of trustees for the Screen Actors Guild-Producers Pension and Health Plans said in a statement that it had appointed Chris Dowdell, the current chief operating officer, as interim CEO.

"It is with great regret that we accept our CEO Bruce Dow's decision," the statement said. "For the last 28 years, Bruce has been instrumental in assisting the trustees in designing and managing many of the benefit programs actors enjoy today."

U.S. Labor Department officials have been investigating reports that another former senior pension plans executive allegedly embezzled millions of dollars by receiving kickbacks from several companies that did business with the funds.

After an audit in early 2009, SAG-PPHP sued two vendors involved in the alleged scheme. In one of the cases, an arbitrator awarded the plans nearly $2.5 million in damages, which a court approved. The plans said most of the money was recovered from an insurance claim.

The alleged embezzlement scheme surfaced publicly in a complaint that former Human Resources Director Craig Simmons filed in September with the Labor Department. In his complaint, Simmons contended that he had been wrongfully terminated in March 2011 partly for raising questions about the alleged embezzlement and for raising questions about Dow's conduct, including allegations that Dow steered business to his wife's insurance company, USI of Southern California.

The board of trustees later said an independent investigator had found that most of Simmons' allegations were false and told SAG members that the fiscal integrity of the plans "remains sound and your benefits are secure." There was no finding by the board that Dow was involved in a coverup.

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Bruce Dow takes leave of SAG's health and pension plans

-- Richard Verrier

Two labor unions back EMI sale to Universal Music

SAG-AFTRA, the merged entity of the Screen Actors Guild and the American Federation of Television and Radio Artists, and the American Federation of Musicians gave their blessings Tuesday to Universal Music Group's $1.9-billion deal to buy EMI's recorded music business, which represents bands such as Coldplay, Massive Attack, Pink Floyd and others, from Citigroup Inc.

The pending deal, forged in November, also calls for Sony ATV to pay $2.2 billion for EMI's publishing assets. Both require the approval of U.S. and European antitrust regulators, who must decide in the next few months whether the deal would restrict competition and harm consumers.

A number of critics have piped up against the deal, including the consumer advocacy group Public Knowledge and Warner Music Group, whose former Chief Executive, Edgar Bronfman Jr., took a swipe at the pending merger in January, calling it "dangerous." (Warner had also offered to buy EMI, but was outbid by Universal.)

It's not usual for a labor union to speak up in support of big business deals. With that backdrop, the dual union endorsements of the merger seems even more unusual, especially because other labor groups such as the Writers Guild have been outspoken critics of media consolidation.

Why this departure, then? In a word -- jobs.

SAG-AFTRA, which represents 150,000 actors, writers, recording artists and other media professionals, acknowledged in its letter Tuesday to the U.S. Federal Trade Commission that the group has "generally expressed skepticism toward corporate mergers and acquisitions." The FTC has taken the lead in examining the merger for potential antitrust issues.

In this case, however, the union said the merger would save EMI from drifting into "oblivion," wrote Kim Roberts Hedgpeth, outgoing co-national executive director of SAG-AFTRA, who this week announced her pending retirement.

Allowing EMI to deteriorate on its own "would also do a disservice to American workers, whose jobs would be at risk should EMI wither further or be sold in pieces to fuel quick profits for capital investors," she added.

Raymond Hair Jr., president of the American Federation of Musicians of the United States and Canada, put forth the same argument in a separate letter to the FTC, saying "sustaining the EMI legacy, which produced world popular music artists such as the Beatles and Frank Sinatra, under UMG's oversight would appear to benefit AFM recording musicians."

So far, neither the FTC nor the European Commission have issued opinions on the merger, which would fold EMI's assets into two of the world's largest record companies and reduce the number of major music companies from four to three.

RELATED:

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EMI Group sold to Universal, Sony for $4.1 billion

-- Alex Pham

Photo: Chris Martin, lead singer of Coldplay, a band signed with EMI Music. Credit: Rafa Rivas / Getty Images.

Kim Roberts Hedgpeth to step down as co-director of SAG-AFTRA

Kim Roberts Hedgpeth, the longtime leader of the American Federation of Television and Radio Artists, is stepping down as a co-national executive director of the newly merged union, SAG-AFTRA.

"It was with great pride and enormous satisfaction that I joined union members, colleagues and staff on March 30 to celebrate the overwhelming vote in favor of AFTRA and SAG,'' Hedgpeth said. "Having achieved this important goal, for which many of us worked so tirelessly for so many years, now is the right moment to begin a new chapter in life."

Hedgpeth, who will leave her post April 30, has served as AFTRA's national executive director since 2005. But her future was cast into question once AFTRA and SAG members voted on March 30 to merge their organizations.

Board members from both unions had named Hedgpeth and SAG Executive Director David White as co-national executive directors, but it was widely expected that White would eventually head the combined group after a transition period.

During her tenure at AFTRA, Hedgpeth served as chief negotiator for many of AFTRA's national contracts covering actors, broadcast journalists, recording artists, among others, and was widely praised for her contributions to the union.

"Kim is in a league of her own,'' said Roberta Reardon, co-national president of SAG-AFTRA. "Through her remarkable negotiating skills at the bargaining table, her superb administration of the union and her principle attentiveness to the needs of members, Kim has improved the careers and lives of thousands of union members around the nation."

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— Richard Verrier

Photo: Kim Roberts Hedgpeth, co-national executive director of SAG-AFTRA. Credit: AFTRA.

Judge rejects attempt to cancel SAG-AFTRA merger vote

A federal judge has a blocked a request for a temporary injunction that would have scuttled a vote on merging the Screen Actors Guild with the American Federation of Television and Radio Artists.

Ed Asner, Martin Sheen and Ed Harris were among a group of actors who filed a lawsuit in federal court in Los Angeles last month seeking an injunction to stop SAG from calling for a vote on the proposed merger with AFTRA.

But, as was widely expected, a federal judge denied the request, clearing the way for the unions to count ballots this Friday. The merger would be ratified only if at least 60% of those who vote approve the plan.

“Voting in favor of merger may or may not be in the best interest of the majority of union members,'' wrote Judge James Otero. "But the decision, for better or worse, belongs to the members –- not to plaintiffs, and certainly not to the court.”

The lawsuit alleged that the SAG board breached its fiduciary duties to conduct an actuarial impact study detailing the effects of the proposed merger on health and pension benefits for SAG members. SAG's board overwhelmingly approved a plan to merge with the smaller actors union, arguing that doing so would give them more leverage in negotiations with the studios and end years of turf wars between the two labor groups.

“We are pleased with the court’s action denying the requested injunction and dismissing one of the plaintiff’s major claims in this matter,'' SAG Deputy National Executive Director and General Counsel Duncan Crabtree-Ireland said. "We are also gratified that the court has indicated that the plaintiffs are unlikely to prevail on their other claims. It has been our position all along that these complaints were completely without merit and that the members will ultimately decide the future of their unions.”

RELATED:

SAG board votes to approve merger plan

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SAG, AFTRA craft merger plan

--Richard Verrier

Photo: Ed Asner is shown in character in 1978 as he portrays the city editor of the Los Angeles Tribune on the television drama "Lou Grant." Credit: Associated Press

 

 

Motion Picture & Television Fund launches fundraising campaign

The Motion Picture and Television Fund has launched a Hollywood fundraising campaign to generate  $350 million in support for the charity and its nursing home that was once slated to close. 

On Thursday, the fund announced that DreamWorks Animation Chief Executive Jeffrey Katzenberg had already helped secure more than $200 million in pledges and donations that include his own contribution and those from Tom Cruise, Steven Spielberg, Steve Bing, Casey Wasserman and George Clooney.

Katzenberg and Clooney are spearheading the campaign efforts. "I am proud to be part of the MPTF legacy of taking care of our own,'' said Katzenberg at a media breakfast held at the Beverly Hills Hotel. "This campaign is the way my generation can ensure that the MPTF will be there to serve future generations forever."

Clooney said he had been a strong supporter of the fund's work. "I was raised to believe that as a community we should be judged by how we take care of people who can't take care of themselves."

The Oscar-nominated star of best picture contender "The Descendants" added: "This is our community. This is our commitment; to make sure that the MPTF is still standing strong for generations to come."

The fundraising announcement follows a recent decision by the fund's board to re-admit patients to the nursing home. The fund's board triggered an uproar in Hollywood when it announced plans in January 2009 to shut down the nursing home -- which was established to care for retiring actors and other performers, citing heavy financial losses.

MPTF Chairman Bob Beitcher said cost-cutting and fundraising efforts made it possible for the charity to operate a smaller nursing home, with about 40 residents, instead of the more than 130 it had in 2009. The fund recently partnered with UCLA Health System to operate a geriatric psychiatric unit at the skilled nursing home.

Fund officials also have spent months negotiating with Kindred Healthcare Inc. of Louisville, Ky. Under a proposed deal, Kindred would invest $10 million to remodel an existing hospital building and would lease hospital and rehabilitation beds from the fund.

Beitcher said the $350 million would provide a much-needed infusion to help finance improvements to the nursing home as well as other social and healthcare services provided by the charity.

"Over the next 20 years, approximately 100,000 industry members and their families, our very own baby boomers, will be retiring,'' Beitcher said. "And the fact is that today we can't anticipate what kind of help and support they'll need from the MPTF. But we can be certain that there will continue to be needs that otherwise won't be filled without the support of the charity."

RELATED: 

Motion Picture Home to remain open, admit new patients

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-- Richard Verrier 

Photo: Bob Beitcher, George Clooney and Jeffrey Katzenberg gather as the Motion Picture Television Fund launches a $350-million fundraising campaign with support from Hollywood luminaries at the Polo Lounge at the Beverly Hills Hotel. Credit: Motion Picture Television Fund.

Ed Asner, Valerie Harper and others sue to block SAG-AFTRA merger

Ed Asner and Valerie Harper are teaming up on a new project: an attempt to take down the proposed merger of the Screen Actors Guild and the American Federation of Television and Radio Artists.

Asner and Harper, who starred in the 1970s "Mary Tyler Moore" series, have joined other high profile actors including Ed Harris and Martin Sheen in filing a lawsuit in Los Angeles federal court Wednesday seeking an injunction to stop SAG from calling for a vote on the proposed merger with AFTRA.

Referendum ballots will be mailed to members Feb. 27 and are due back March 30. The merger would be ratified only if at least 60% of those who vote approve the plan.

The suit alleges that the SAG board breached its fiduciary duties to conduct an actuarial impact study detailing the effects of the proposed merger on health and pension benefits of SAG members. SAG's board overwhelmingly approved a plan to merge with the smaller actors union, arguing that doing so would give them more leverage in negotiations with the studios and end years of turf wars between the two labor groups.

A minority of board members have maintained that the proposed combination would weaken health and pension benefits for SAG's 125,000 members, about 40,000 of whom also belong to AFTRA.  

"We have spent almost two months negotiating with SAG in an effort to get them to present the truth regarding this merger plan,'' Los Angeles attorney David Casselman said in a statement. "They have done nothing of substance to support their claims that the proposed merger will protect SAG benefits." 

Defendants named in the suit include SAG Executive Director David White, SAG President Ken Howard and other officers of the union.

In statement, SAG said the lawsuit was without merit. “Any suggestion that the members have not been fully and fairly informed is preposterous,'' SAG said. "We have scheduled more than 50 informational meetings across the country, have posted all of the merger documents on the website for over 4 weeks, and we have afforded the merger opponents the right to send an opposition statement at the unions’ expense as part of the referendum package...This filing is simply a public relations stunt that follows a clear pattern by some of the plaintiffs of filing unsuccessful lawsuits against their own union. We do not believe that the members will be fooled."
 
RELATED:

SAG board votes to approve merger plan

SAG-AFTRA merger means some dues will rise, others fall

SAG, AFTRA craft merger plan

--Richard Verrier

Photo: Ed Asner is shown in character in 1978 as he portrays the city editor of the Los Angeles Tribune behind his office desk on the television drama "Lou Grant." Credit: Associated Press

 

 

 

 

 

 

 

AFTRA health and pension plan trustees take union to task

In what could be a move by employers to throw some cold water on the planned merger of Hollywood's two actors unions, trustees for the health and pension funds of the American Federation of Television and Radio Artists have issued a statement challenging some legal opinions cited by the unions.

The trustees of AFTRA's health and retirement plans, which include representatives from labor and management, on Thursday took issue with a "feasibility review" document the unions posted on their websites this week. Those cited the opinion of various lawyers -- including Jani Rachelson, co-counsel of the AFTRA Health and Retirement Funds -- stating "there are no legal impediments to merging the plans." 

The feasibility review was part of an overall merger package the boards of the two unions recently approved in a bid to gain more leverage in negotiations with studios, which in the past have successfully exploited divisions between the two groups to gain the upper hand in contract talks. Members of each union will vote on the merger in the coming weeks.

On Thursday, the board of trustees for the AFTRA health and pension funds said the feasibility review did not represent the opinion of the board.

"The Board of Trustees did not request or authorize this opinion of Fund co-counsel and had no prior knowledge of this letter before reading the posting on the websites,'' the trustees said in a statement. "Although there is no doubt that planned mergers are legally permissible in appropriate circumstances, the merger of pension and health funds as large and divergent as the SAG and AFTRA plans raise complex and unique financial, legal and benefit issues which can only be addressed through a comprehensive analysis performed by the funds."

Details on how the unions' respective health and pension plans will be combined will be addressed only after members approve a merger in upcoming referendum.

A spokeswoman for AFTRA declined to comment on the matter. 

RELATED:

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SAG board votes to approve merger plan

SAG-AFTRA merger means some dues will rise, others fall

-- Richard Verrier

AFTRA board agrees to tie the knot with SAG

The long-sought marriage of Hollywood's two actors unions cleared another hurdle Saturday when the board of American Federation of Television and Radio Artists endorsed a plan to merge with the larger Screen Actors Guild.

As expected, the AFTRA board approved a recently-negotiated merger plan by 94% to 6%, echoing a similar endorsement on Friday by SAG's national board.

The plan would create the largest entertainment union in Hollywood, combining the diverse memberships and cultures of two very different organizations that have talked about joining forces for decades.

SAG has 125,000 members who are actors, extras and stunt performers. AFTRA's 70,000 members include actors, as well as singers, dancers, broadcast journalists and talk show hosts. The unions already have 40,000 members in common and are eager to consolidate to strengthen their negotiating clout.

With the approval of the their respective boards, the merger document -- which includes a merger agreement, a proposed constitution and dues plan -- will now go before members in a referendum vote to be held in coming weeks. The proposed new union is to be called SAG-AFTRA and probably will be touted Sunday night at the 18th Annual Screen Actors Guild Awards. SAG's leadership has made merging with AFTRA a top priority.

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SAG board votes to approve merger plan

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SAG, AFTRA craft merger plan

-- Richard Verrier

Screen Actors Guild votes to approve merger plan

The Screen Actors Guild national board of directors voted overwhelmingly to approve a plan to merge with its sister union, the American Federation of Television and Radio Artists.

The board voted 87% to 13% in favor of a historic merger agreement with AFTRA that includes a proposed constitution and dues payment plan for what would be the largest labor group in Hollywood.

SAG represents about 125,000 actors; AFTRA has 70,000 members, including actors, broadcasters, disc jockeys, singers and dancers. At least 40,000 people are members of both unions. The union is to be called SAG-AFTRA.

AFTRA's board is expected to approve the merger package this weekend, clearing the way for a referendum to be held by members of both unions in the coming weeks. The merger would take effect only if at least 60% of those who vote approve the marriage.

A previous attempt at merging the unions narrowly failed in 2003, partly out of fears that SAG would lose its autonomy. But support for the idea has grown considerably since then. Leaders of both unions want to join forces to end years of bickering and present a more unified voice in contract negotiations with employers.

Under the plan, national officers, including the president and secretary-treasurer, would be elected directly by members. However, some other positions, including that of an executive vice president, would be elected by delegates at a convention held every two years, a nod to AFTRA's tradition of using conventions and delegates. SAG elects its officers directly by a vote of members. Dues will increase for some members and drop for others.

RELATED:

SAG-AFTRA merger means some dues will rise, others fall

SAG, AFTRA craft merger plan

Actors lose out on health benefits as SAG, AFTRA keep separate plans

--Richard Verrier

Photo: Screen Actors Guild President Ken Howard. Credit: Al Seib / Los Angeles Times

SAG-AFTRA merger means some union dues will rise as others fall

The proposed merger between the Screen Actors Guild and the American Federation of Television and Radio Artists will bring higher dues for some actors and lower dues for others, depending on which labor group they already belong to before the marriage.

SAG members will see as much as a 15% decrease in so-called working dues, which are calculated as a percentage of a member's earnings. AFTRA-only members will see their working dues increase by up to 6%, according to a board member who asked not to be identified because the plans are confidential.

Additionally, base dues -- the dues that actors pay for simply being a member of the union -- will increase substantially, to nearly $200 from about $120 a year. However, the nearly 50,000 members who already belong to both unions will see a decline in total fees after the merger, because they will be paying dues to one organization instead of two.

Currently, SAG members pay higher percentages and have higher caps on their incomes than their counterparts at AFTRA. The proposed dues change is intended to reduce the gap.

SAG has about 125,000 members while AFTRA claims 70,000 members. The proposed dues changes are part of a merger agreement reached last week and reviewed by board members from SAG and AFTRA on Sunday. The boards of SAG and AFTRA are scheduled to vote on the proposed merger of the unions next weekend.

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-- Richard Verrier