Why Child Social Media Stars Need a Coogan Law to Protect Them From Parents

THR_younghollywood_Coogan Law-Illustration by Rami Niemi-H 2019
Rami Niemi

Young influencers lack the protection required for kids working in film and TV as legislation to address the problems loses its teeth in the California Assembly: "This space is flooded with opportunities for people looking to make a quick buck."

One of the highest-paid child stars of 2018 didn't get his big break appearing in films or on television but instead on a considerably smaller screen. In 2018, Ryan Kaji, the 7-year-old behind YouTube channel Ryan ToysReview, earned an estimated $22 million by unboxing toys for the camera.

Kaji is part of a growing generation of young social media superstars who self-publish content on platforms like YouTube and Instagram, where their millions of followers generate lucrative ad revenue, brand partnerships and paid product endorsements. Though his parents have been proactive about putting the money Kaji earns aside for him to access when he becomes an adult, digital influencers' income (unlike children's earnings from work in traditional media), is not protected by law — raising questions about the possibility of parents exploiting young online talent.

The Coogan Law, which requires 15 percent of a child's earnings to be deposited in a blocked trust account, is one of Hollywood's key mechanisms for protecting minors from such exploitation. Enacted in 1939 after Jackie Coogan sued his parents for burning through the money he made as a child actor, 80 years later it still protects young entertainers. Yet advocates for child workers' rights argue that the law hasn't kept pace with the digital age, and as a result, kidfluencers are falling through the cracks. In fact, no law outlines protections for minors earning income in social media. It's a cause for concern since, without protections, they stand to lose millions to their own parents.

In 2018, California lawmakers took a first stab at this issue with a bill that attempted to add "social media advertising" to the definition of employment in child labor law. Under this "kidfluencer" bill, minors working in the digital sphere would have to obtain a work permit and follow measures similar to those required by the Coogan Law. The effort was spearheaded by Anne Henry, co-founder of BizParentz, a nonprofit that advocates for children in entertainment. Kidfluencing caught her attention after Arizona mom Katie Stauffer told a local news outlet that she was able to quit her day job and pursue social media full-time after her twin daughters (4-year-old influencers Mila and Emma) blew up on Instagram. Stauffer responded to criticism with a line oft used by parents of young digital talent: If my kids are having fun, what's the big deal? But Henry doesn't see it that way. "If you're lending your image and you're doing something to sell a product, it's work," she counters. "If it's work, then your money should be protected."

The version of Assemblyman Kansen Chu's bill that was signed into law and went into effect in January was diluted significantly from what the Bay Area representative originally proposed. It exempts young digital creators from obtaining work permits if their performance is unpaid and shorter than an hour. "We lost the battle in hopes of someday winning the war by trying to define that digital exhibition counts," says Henry. Critics of the kidfluencer bill argued that enforcing work permits would be difficult, if not impossible. Unlike traditional media, which is subject to strict schedules and studio oversight, digital content can be filmed whenever and wherever a creator wants. This was particularly problematic for the Studio Teachers Union, as California law requires the services of an on-set educator. "No one thought it was realistic to send a studio teacher into a private home where kids are doing YouTube videos in their basement," explains Henry. But scrapping the work permit provision effectively prevented the bill from enforcing Coogan Law protections, because in Hollywood they're a package deal: If a parent doesn't provide the studio with a Coogan account number, his or her child's work permit is voided. And if work permits aren't mandatory for kidfluencers, their parents have no legal obligation to open a Coogan account.

Henry insists that while most parents likely don't intend to steal from their kids, they may be unprepared for a kidfluencer's fame and unequipped to handle it. But in the absence of clearly defined rules or regulations, the responsibility of protecting young influencers often falls to their reps. Manager Byron Austen Ashley of Settebello Entertainment requires parents he works with to save their kids' earnings. "I made a policy at my company that we only work with children if they're entirely protected by Coogan accounts," he says, noting that a child's income is spent only to cover necessary expenses like transportation and legal fees.

One of Ashley's star clients is Gavin Thomas, who skyrocketed to internet fame at age 2 when his uncle started posting clips of him on Vine. Under his agent's guidance, the now 8-year-old Minneapolis native has a budding career that includes commercials, brand partnerships and a massive fan following in China. To ensure his schedule complies with child labor laws, Ashley works with Thomas' family and legal team to plan any non-union shoots. In his view, labor abuse and financial exploitation go hand in hand: "If [parents] are using [the child's earnings] for personal reasons, that amplifies the risk of them planning 10-hour workdays, rather than structured, comfortable workdays."

Chas Lacaillade, CEO and founder of Bottle Rocket Management, represents the LeBlancs, a YouTube family that vlogs under the name Bratayley. His firm makes up for the lack of regulations by referring clients to business managers. Annie and Hayley, the family's two daughters, have separate Coogan accounts and put 100 percent of their earnings in the bank. And the parents of toy unboxer Ryan also use the 100 percent policy for his Nickelodeon series Ryan's Mystery Playdate — even though the law only demands that they set aside 15 percent. Noting that "all other sources of revenue are beyond Coogan Law's requirements," Ryan's father, Shion, says that digital earnings are distributed into "college savings, Coogan accounts, minor accounts and trust accounts" for Ryan and his sisters, who also feature on the family YouTube channel. Not everyone follows the honor system, however, including other managers. Says Lacaillade, "This space is flooded with opportunities for people looking to make a quick buck."

Among influencers' parents who are aware of the Coogan Law, Henry says many feel it's fundamentally anti-parent. "It's basically saying they're expecting [you] to steal your kid's money," she says. "As a parent, that's kind of insulting. [There are] thousands of parents investing in their kid's career and having no payoff for every one that does it wrong." Still, stakeholders feel something should be done to curb existing exploitation. At the moment, a child influencer's only form of legal recourse is to sue his or her parents at the age of 18. At the very least, the kidfluencer bill's addition of "digital exhibition" to the labor code may strengthen a victim's chances in court. It also opens the door for introducing legislation specific to the Coogan Law, which Chu aims to do in the coming year. That begins with stepping up efforts to raise awareness of the progress that has been made. "We're not doing enough outreach," he says, adding with a laugh: "We're relying on social media to help us promote this bill."

A previous version of this story misspelled the first name of Ryan Kaji's father.

This story first appeared in the Aug. 12 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.