Top Talent Agencies Face Possible Legal Exposure for Enabling Harassment

As star clients fall, WME, CAA and the rest may be caught in the crosshairs of unreported misconduct and financial incentives.

On Nov. 6, WME called an all-hands meeting, just three days after agent Adam Venit had taken a leave of absence over allegedly grabbing agency client Terry Crews' genitals in February 2016. Witnesses say Endeavor CEO Ari Emanuel grew emotional as he explained the decision to suspend Venit, a top earner who reps Adam Sandler, Eddie Murphy, Kevin James and producer Shawn Levy.

Like many of the Hollywood sexual harassment and assault allegations that have surfaced since The New York Times published its first story about Harvey Weinstein on Oct. 5, the Venit-Crews incident forced WME to act quickly and raised questions about the status quo at the top agencies in which a lower-level client's interests can be ignored to serve a larger agenda.

Sources say Crews complained about the incident to his agent, WME's Brad Slater. The agency was unaware until Crews made public comments Oct. 10 and then recently investigated to determine if it was an isolated event or indicative of a pattern, and found the former to be the case. Still, Venit was suspended without pay for a month and demoted from his position as head of the motion picture department. Sources say Venit, 54, will return to the agency, where he also reps Steve Martin, Sylvester Stallone and Vince Vaughn. Days after Emanuel's speech, Crews fired WME and filed a report with the L.A. Police Department.

The Venit episode also echoes criticism of CAA, which repped many of the actresses at the center of harassment claims, leading some to suggest it enabled alleged predators like Weinstein and Steven Seagal. Legal experts say agents have a fiduciary duty to clients — regardless of where they fall in the agency pecking order — and now could face legal exposure for failing to represent them properly.

"If you have an agency that knowingly protects the perpetrator and encourages this activity by sending unknowing victims to such auditions, that is likely a crime if not a real breach of fiduciary duty," says Washington-based attorney Kirk T. Schroder, former chair of the American Bar Association's entertainment and sports law section. Adds attorney Edwin McPherson, who reps Sandra Bullock and Lady Gaga: "If I were an actress who was sent over to Harvey Weinstein or someone else's hotel room and got assaulted or harassed, and I could prove that my own agency knew about this and sent me anyway and didn't warn me, absolutely there is culpability. 'You could have foreseen this, you could have stopped this, you had some duty to protect me, and you didn't.' "

In the case of Weinstein, CAA repped both the mogul and many of his accusers. Ditto for Seagal. Actress Rae Dawn Chong told THR that her CAA agent Kevin Huvane subjected her to "a pimp situation" regarding a Seagal meeting, in which the actor exposed himself. Huvane said he "would never knowingly put a client at risk."

Since that exchange, a number of actresses, including Portia de Rossi and Eva LaRue, have come forward with their own horror stories involving Seagal, once one of CAA's top clients. For both Weinstein and Seagal, there is a long trail of nearly identical anecdotes stretching back to the 1980s of agency-set nighttime hotel "auditions" that ended in alleged harassment or assault.

The Talent Agencies Act, which was passed in 1978 as part of the California Labor Code, requires all talent agents be registered under the state's labor commission. The law primarily covers protecting the economic interest of a client and only briefly mentions inappropriate conduct. But according to the TAA, an agent's fiduciary duty includes protecting a client from such behavior.

The classic problem with agencies is that they are beholden to individual megaclients like Seagal or Venit client Sandler, whose high salaries generate commissions that power the companies. They also need to appease big spenders with leverage. "That's even the bigger conflict — that they need a Harvey Weinstein. He's the substantial, significant buyer, and they don't want to alienate the buyer," says McPherson.

Under the TAA, an aggrieved client can attempt to sever a representation contract on the grounds that an agent violated his or her fiduciary duty. But in cases of sexual harassment or assault, that would be less relevant given that many clients would choose not to come forward — out of a concern that if they did speak out, they would brand themselves troublemakers and make it difficult to secure future representation. With clients feeling silenced, that leaves the agency to take action on its own.

As Venit was heading on leave Nov. 3, rumors swirled that several high-profile CAA and WME agents were on the chopping block due to sexual harassment or covering it up for a client. (CAA recently ousted TV literary head Ryan Ly, WME parted ways in 2016 with lit agent Cliff Roberts and ICM Partners axed TV agent Erik Horine, all under the cloud of harassment claims.) CAA also repped a number of those who have been accused of impropriety, including Kevin Spacey and Matthew Weiner (the agency dropped Spacey). WME's Venit handled Brett Ratner and Dustin Hoffman (both remain clients).

Adds McPherson: "There's no way that this went on for this long and the people in power at the agencies didn't know about it."

Kim Masters contributed to this report.

A version of this story first appeared in the Nov. 15 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.