Heidi Kortenbach vs. Charlie RairdoniDIVISION OF LABOR STANDARDS ENFORCEMENT Attorney for the Labor Commissioner BEFORE THE LABOR COMMISSIONER OF THE STATE OF CALIFORNIA Heidi Kortenbach Petitioner, vs. Charlie Rairdoni, an individual Respondent. No. TAC 25-97 DETERMINATION OF CONTROVERSY INTRODUCTIONThe above-captioned petition was filed by Heidi Kortenbach (hereinafter "petitioner") on May 29, 1997, seeking reimbursement of the $700 that Charlie Rairdoni, an individual dba Photo Casting Productions, aka Rairdoni Productions (hereinafter "respondent" ) had charged the petitioner for photographs, plus penalties pursuant to Labor Code section 1700.40. Respondent was personally served with a copy of the petition on June 13, 1997, and filed an answer to the petition on June 26, 1997, admitting that he collected $700 from the petitioner for a "portfolio fee," but denying that that held himself out as a talent agency or that he ever promised, offered, or attempted to procure employment for petitioner, and therefore, that he is entitled to keep the amounts paid by petitioner for the "portfolio fee," and to payment of additional sums purportedly still owed by the petitioner pursuant to a written agreement between the parties. A hearing was scheduled before the undersigned attorney, specially designated by the Labor Commissioner to hear this matter, and the hearing commenced as scheduled on August 4, 1997, in Los Angeles, California. Both the petitioner and the respondent appeared in propria persona. Based upon the testimony and evidence received at this hearing, the Labor Commissioner adopts the following determination of controversy. FINDINGS OF FACTPetitioner first met the respondent while she was jogging. According to the petitioner's testimony, the respondent introduced himself to her by saying that he owned a production agency and that he could find work for her modeling for JC Penney and other companies, and work as an actress on a film, but that she would first need to come into his office for a photo shoot. Respondent gave a business card to the petitioner that identified his business as Photo Casting Productions, and that stated he did "casting for calendars, department store ads, videos, feature films, posters, models, [and] television commercials." On April 5, 1997, petitioner met with respondent at his office, and signed pre-printed "Personal Management Contract" that had been prepared by the respondent. Under this contract, petitioner engaged respondent as her "personal manager" for a period of five years, for which she agreed to pay commissions to the respondent equal to 10% of her entertainment and modeling earnings for the first two years of the agreement, and 20% of these earnings during the next three years of the agreement. The contract states that "it is clearly understood that you are not an employment agency nor theatrical, modeling agent, that you have not offered or attempted or promised to obtain employment or engagements for me, and that you are not obliged, authorized or expected to do so." On April 10, 1997, petitioner returned to respondent's office to sign another agreement, entitled "Actors/Actresses/Models Contract Agreement," under which petitioner agreed to pay $1,500 for "a portfolio of photos [and] registrations for work in the modeling and acting film industry." At that same time, petitioner paid $500 in cash to the respondent as an initial payment for her photographs, and promised to pay the remaining $1,000 balance in $200 weekly installments. One week later, petitioner provided the respondent with a $200 money order, leaving a remaining balance of $800. Shortly thereafter, respondent began expressing a romantic interest towards the petitioner; this made her quite uncomfortable, and she told the respondent that she no longer was interested in having him take her photographs, and she requested a different photographer for the as yet unscheduled shoot. Respondent failed to set up the photo shoot with another photographer, and petitioner demanded reimbursement of the $700 that she had already paid. Respondent refused to make any refund, and instead demanded that petitioner pay the remaining balance. Petitioner then filed and served the respondent with this petition to determine controversy. Respondent stipulated that he has never been licensed by the Labor Commissioner as a talent agency. He testified that he routinely "works with licensed talent agents," and denied that he ever told the petitioner that he could get work for her. Rather, respondent testified that he had told the petitioner that he would help her find an agent. Petitioner's testimony differed sharply from that of the respondent; she testified that he told her that he could find employment for her, and that until he was served with this petition, he had never advised her of the need to engage the services of a licensed talent agent, and never gave her the names of any licensed talent agents. According to the petitioner, after the respondent was served with the petition, he telephoned her and said, "I'm not a talent agent. . . . I use companies like Elite that are licensed." Respondent testified that he never told the petitioner that he does business with Elite. As to this conflict in testimony, there is no doubt that it is the petitioner's account that is truthful -- during her rebuttal testimony, petitioner played a tape recording from her answering machine of the respondent's telephone call to her after he was served with the petition, and the respondent clearly stated, "I go through other agencies that are licensed, like William Morris and Elite." Other areas of Respondent's testimony cast further doubts on his credibility. Respondent testified that the amount charged to the petitioner was for a portfolio of photographs and "registrations to work as a model or actress." According to the respondent, this would enable him to register the petitioner with three talent agencies, that is, to pay the "registration fees" that he claims these agencies charge to represent artists. The contract that was signed by the petitioner on April 10, 1997, specifically states that she will be provided "three agency registrations." [1] But when asked to state the names of the three agencies that he uses, and whether those agencies charge such "registration fees," the respondent replied that he could not recall the names of any agents that he uses, except for a business in Hollywood called "Judy's Casting," which he claims charges a "registration fee" of $25. Respondent testified that he did not know the full name of the owner of this business, or its street address.[2] Respondent's alleged inability to recall any details about the licensed agencies that he previously claimed he "routinely works with" speaks volumes about his utter lack of credibility. We therefore credit petitioner's testimony over the respondent's in other areas where their testimony conflicts; and we specifically find that the respondent did state to the petitioner that he would attempt to find work for her, and did not inform the petitioner of the need to obtain the services of a licensed talent agent. CONCLUSIONS OF LAW1. Labor Code section 1700.40 provides that "no talent agency shall collect a registration fee." The term "registration fee" is defined at Labor Code section 1700.2(b) as "any charge made, or attempted to be made, to an artist for . . . registering or listing an applicant for employment in the entertainment industry [or for] photographs, film strips, video tapes, or other reproductions of the applicant [or] . . . any activity of a like nature." It is well established, pursuant to section 1700.40, that a talent agency cannot charge an artist for a photo shoot, for the printing of photographs, or for the production of a portfolio of photographs. 2. The issue here, of course, is whether based on the evidence presented, Respondent operated as a talent agency within the meaning of Labor Code section 1700.4(a). That statute defines a "talent agency" as "a person or corporation who engages in the occupation of procuring, offering, promising, or attempting to procure employment or engagements for an artist or artists." [3] The statute also provides that "talent agencies may, in addition, counsel or direct artists in the development of their professional careers." 3. The provisions in the "Personal Management Contract" that warrant that Respondent is not a talent agent, and that he has not offered, attempted or promised and is not authorized or expected to procure employment for the petitioner are not dispositive, nor particularly significant, as to the issue of whether Respondent did, in fact, do or promise to do any of the things that fall within the definition of a "talent agency" under Labor Code section 1700.04(a). In Buchwald v. Superior Court (1967) 254 Cal.App.2d 347, the court rejected the argument that the identical provisions of a written contract between the musical group "Jefferson Airplane" and their "personal manager" established that the "personal manager" was not a "talent agent" within the meaning of the Talent Agencies Act. Instead, the court held, "The court, or as here, the Labor Commissioner, is free to search out the illegality lying behind the form in which a transaction has been cast for the purpose of concealing such illegality. [citation omitted.] The court will look through provisions, valid on their face, and with the aid of parol evidence, determine that the contract is actually illegal or is part of an illegal transaction" Id., at p. 355. 4. Weighing the evidence presented, we have concluded that the Respondent offered and promised to procure modeling or acting employment for the petitioner. Consequently, Respondent engaged in the occupation of a "talent agency" within the meaning of Labor Code section 1700.4(a). Under section 1700.4(a), the act of either promising or offering to procure modeling employment, without anything more, constitutes engaging in the occupation of a talent agency. But here, there is more. Respondent's testimony leaves no doubt that he routinely engaged in activities to procure employment for the artists he represents. And the petitioner's decision to engage respondent as her "personal manager" was based precisely on his representations to do just that for her. 5. Labor Code section 1700.5 provides that no person shall engage in or carry on the occupation of a talent agency without first procuring a license therefor from the Labor Commissioner. This means that a person who engages in any of the activities enumerated in Labor Code section 1700.04(a) -- that is, procuring, offering, promising, or attempting to procure employment for an artist or artists -- must be licensed as a talent agency. By doing any of these things without being licensed as a talent agency, Respondent is in violation of Labor Code section 1700.5. To be sure, Labor Code section 1700.44(d) provides that it is not unlawful for a person who is not licensed as a talent agency to "act in conjunction with, and at the request of, a licensed talent agency in the negotiation of an employment contract." Respondent does not fall into this very limited exception to the Act's licensing requirement. Respondent presented no evidence that his employment procurement activities on behalf of the artists he represents are undertaken at the request of any licensed talent agency. Moreover, as previously held in Pamela Anderson v. Robert D'Avola (Labor Commissioner Case No. TAC 63-93), the licensing exception allowed by Labor Code section 1700.44(d) does not apply to any period prior to the artist's retention of a licensed talent agent, and the unlicensed person seeking to come within the exception offered by section 1700.44(d) must show that his participation in negotiations was requested by that licensed agent. An arrangement between an unlicensed person and a licensed agent who is unknown to the artist and was never hired by the artist, under which these individuals "work together" to procure employment for the artist, is little more than a transparent subterfuge. To permit such a subterfuge would eviscerate the Act's licensing requirement. 6. Having determined that Respondent engaged in the occupation of a "talent agency" within the meaning of Labor Code section 1700.4(a), we necessarily conclude that the Respondent violated Labor Code section 1700.40 by charging and collecting $700 from petitioner as a deposit for the photo shoot, photo processing, production of the portfolio of photographs, and "agency registrations." Petitioner is therefore entitled to reimbursement of this amount, with interest at 10 percent per annum from the date these amounts were unlawfully collected by the Respondent, in accordance with the provisions of Civil Code sections 3287 and 3289. 7. Labor Code section 1700.40 further provides that a talent agency that fails to reimburse an artist within 48 hours of the artist's demand for reimbursement of any fees that were paid to the agency for the procurement of employment must pay the artist a penalty equal to the amount of the improperly withheld fee if the artist did not procure, or was not paid for, the employment for which the fee was paid. Here, petitioner paid the above-described fees in order to have Respondent procure modeling or acting employment on her behalf. Respondent failed to reimburse these fees to petitioner within 48 hours of her demand therefor, and never procured any such employment for the petitioner. Consequently, we find that all of the requirements are met for an award of penalties pursuant to section 1700.40. Without such an award, there would be little incentive for Respondent to conform his future conduct to the Act's requirements. We therefore conclude that petitioner is entitled to $700 in penalties. 8. Petitioner is also entitled to reimbursement of the amounts paid to the respondent pursuant to the "Actors/Actresses/Models Contract Agreement" under the following alternative cause of action: Any agreement between an unlicensed talent agent and an artist under which the agent derives a purported right to compensation is unenforceable and void ab initio, and an artist who paid commissions or any other compensation to an unlicensed agent pursuant to such an agreement is entitled to reimbursement of such amounts paid in the one year period prior to the artist's filing of a petition or action for recovery. See, Buchwald v. Superior Court, supra, Waisbren v. Peppercorn Productions (1995) 41 Cal.App.4th 246. We therefore hold that both contracts executed by the parties -- the "Actors/Actresses/Models Contract Agreement" and the "Personal Management Agreement" are void and unenforceable, and that respondent has no right to any additional amounts purportedly owed under either of these agreements. ORDERFor the above-stated reasons, IT IS HEREBY ORDERED that Respondent Charlie Rairdoni, an individual dba PHOTO CASTING PRODUCTIONS aka RAIRDONI PRODUCTIONS, pay petitioner Heidi Kortenbach $700.00 for unlawfully collected fees, $23.51 for interest on these fees, and $700.00 in penalties under Labor Code section 1700.40, for a total of $1,423.51. Dated: 8/20/97 MILES E. LOCKER Attorney for the Labor Commissioner ADOPTED AS THE DETERMINATION OF THE LABOR COMMISSIONER: Dated: 8/22/97 JOSE MILLAN State Labor Commissioner 1. The contract does not define the term "agency registrations," and there was no discussion between the parties as to what this term meant. 2. The Labor Commissioner's Licensing & Registration Unit maintains records of all talent agencies that are, or have been, licensed by the State Labor Commissioner. A search of these records reveals that no license has ever been issued to a business operating under the name "Judy's Casting." 3. We find that petitioner is an "artist" within the meaning of Labor Code sect. 1700.04(b), which defines that term to include, inter alia, actresses and models. |