Anti-Merger Lawsuit Filed Against SAG and Officers
UPDATED: Suit seeks to invalidate referendum and lays groundwork to obtain attorneys fees.
Opponents of SAG/AFTRA merger filed suit in federal court Wednesday against the union and its officers, in an effort to preemptively void the merger referendum set to begin next week and force an actuarial study of the impact of merger on pension and health.
Contrary to published reports, the suit does not seek to halt the ballots from being mailed, according to the plaintiffs’ attorney, David B. Casselman of Wasserman, Comden, Casselman & Esensten, who spoke with The Hollywood Reporter. However, if plaintiffs prevail, the ballots would be invalidated – or perhaps not even tallied.
The complaint alleges that the merger proposal – about eighty pages of documents that emerged from 18 months of work by both unions’ boards, staffs and merger committees – nonetheless omits the “necessary due diligence.”
In a statement, SAG blasted the suit as “completely without merit (and a) preposterous . . . attempt at circumventing the will of the membership.” SAG members have voted overwhelmingly for pro-merger board candidates in the last several years.
Casselman said, “member are entitled to full disclosure, not half truths and misleading and unsupported promises.” He added, “if an uninformed membership approves this merger, and then we all learn that it will have crippling, negative effects, it will be too late for anything to be done to return SAG or its current pension and health plans back to their current status,” he added.
SAG responded, “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 have afforded the merger opponents the right to send an opposition statement at the unions’ expense as part of the referendum package.”
THR first broke news of the looming lawsuit last week. At that time, the union’s general counsel,Duncan Crabtree-Ireland, told THR “these complaints are without merit.”
Plaintiffs in the suit include Martin Sheen, Edward Asner, Ed Harris, Valerie Harper, Nancy Sinatra, former guild president Alan Rosenberg and current board members Anne-Marie Johnson and David Jolliffe.
Johnson told THR that an impact study has precedent. “Back in 2003, when the previous merger attempt was in process, the Mercer Report, a detailed impact study, was leaked. Their opinion was that any merger of the SAG and AFTRA pension and health plans would cause a diminution of benefits to SAG members.”
“Without question,” she added, “the union trustees (today) could easily have done a similar impact study.” That would provide members “the information they need,” she said, in contrast to the “feasibility report” the union prepared last month. That latter report stated that plan mergers were legal, common and often beneficial, but it didn’t analyze data regarding the SAG and AFTRA plans specifically or draw any conclusions as to whether they should be merged or otherwise restructured if the unions merge.
The merger plan prepared by the unions would merge the unions, but not the pension and health plans, which are legally separate entities. Plan merger or other modification is a step that can only be taken by the plan trustees, half of whom are appointed by management and half by the respective unions. AFTRA trustees said earlier this month that they would have “a comprehensive feasibility study performed” before taking a position on whether to merge the plans.
Defendants in the suit are SAG, guild president Ken Howard, secretary-treasurer Amy Aquino and vice-presidents Ned Vaughn, Mike Hodge and David Hartley-Margolin. In addition, national executive director David White is listed in the caption (i.e., title) of the case, but omitted from the list of defendants in the body of the document. That suggests he may have been a last-minute addition – or a last-minute deletion.
The suit alleges violations of the SAG Constitution and board resolutions, and federal and state law, and says the merger “is being presented in a deceptive manner.” Rosenberg made that point to THR somewhat more colorfully last week, when he said the merger effort “is being accomplished by liars.”
The suit also claims that by providing for an interim board of directors, the merger plan circumvents laws regarding union elections. However, Crabtree-Ireland pointed out that unions merge all the time, and told THR that “federal Department of Labor regulations allow merging unions to establish interim officers and boards appointed as part of the merger.”
The suit also seeks permission from the court to add an additional claim that would – if the plaintiffs prevail – give the judge has discretion to require that SAG pay their attorneys fees (which could be substantial), their court costs (which are usually not particularly large) and any other necessary expenses (which might include big-ticket consultants and expert witnesses).
Such fee shifting is contrary to the general rule in U.S. lawsuits, which is that each side bears its own fees and costs, but that rule doesn’t apply when statutes, such as this one, explicitly provide otherwise.
The complete list of plaintiffs is: Martin Sheen, Edward Asner, Ed Harris, Valerie Harper, Clancy Brown, James Remar, George Coe, Diane Ladd, Lainie Kazan, Nichelle Nichols, Renee Aubry, Jane Austin, Erick Avari, Steve Barr, Sara Barrett, Terrance Beason, Michael Bell, Warren Berlinger, Joe Bologna, Ralph Brennen, Alexandra Castro, Jude Ciccolella, Cynthia Lea Clark, David Clennon, Joe D’Angerio, Patricia D’Arbanville, Dick Gautier, Dorothy Goulah, Marty Grey, Sumi Haru, Angel Harper, Basil Hoffman, David Huddleston, Anne-Marie Johnson, David Jolliffe, Kerrie Keane, Peter Kwong, Kurt Lott, Barbara Luna, Eric Lutes, Stephen Mach, Michael McConnohie, Peter Antico, Susan McNabb, Phyllis Timbes, Marguerite Moreau, Traci Murray, Nicole Mandich, Larry Newman, Barbara Niven, Kathleen Nolan, Jack Ong, Peggy Lane O’Rourke, Leslie Parrish, Scott Pierce, Robin Riker, Stephanie Rose, Alan Rosenberg, Alan Ruck, Wendy Schaal, Tascha Schaal, Nancy Sinatra, Cynthia Steele, Renee Taylor, Malachi Throne, Beverly Todd, Jessica Wright andMomo Yashimo.