Howard v. Creative Artists Agency

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1 JAMES A. BRYANT II (State Bar No.

255652)
2
THE COCHRAN FIRM CALIFORNIA
4929 Wilshire Blvd. Suite 1010
3 Los Angeles, California 90010
Telephone: 323-435-8205
4
Facsimile: 310-802-3829
5 Email: james.bryant@thecalawgroup.com

6 CARLOS E. MOORE (MS BAR NO. 100685) Not Yet Admitted


THE CARLOS MOORE LAW GROUP
7
306 Branscome Drive
8 Grenada, MS 38902
Telephone: (662) 227-9940
9 Facsimile: (662) 227-9941
Email: carlosmoorelaw@gmail.com
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Attorneys for Plaintiff: TERRENCE HOWARD
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SUPERIOR COURT OF THE STATE OF CALIFORNIA
COUNTY OF LOS ANGELES
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TERRENCE HOWARD, an individual, ) Case No.:
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)
) COMPLAINT FOR:
Plaintiff, )
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v. ) 1. Breach of Fiduciary Duty
17 CREATIVE ARTISTS AGENCY, LLC, a ) 2. Constructive Fraud
Delaware Limited Liability Company, DAVID ) 3. Fraudulent Representation
18 BUGLIARI, an individual, JON TEIBER, an ))
individual, MICHAEL KATCHER, an )
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individual and DOES 1-10. ) DEMAND FOR A JURY TRIAL
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Defendants. )
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1
COMPLAINT
Plaintiff Terrence Howard (“Howard” or “Plaintiff”) hereby alleges for her Complaint
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against defendants Creative Artists Agency, LLC, David Bugliari, Jon Teiber (“Teiber”) and
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Michael Katcher and DOES 1-10 as follows:
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PARTIES
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1. Plaintiff Terrence Howard is an individual and residing in the County of
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Philadelphia, State of Pennsylvania.
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2. Plaintiff is informed and believes and thereupon alleges that Defendant Creative
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Artists Agency, LLC (“CAA”) is a limited liability company authorized to do business in
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California and organized under the laws of the State of Delaware with its principal place of
9 business at 2000 Avenue of the Stars, Suite 100, Los Angeles, County of Los Angeles, State of
10 California.
11 3. Defendant David Bugliari (“Bugliari”), is a talent agent with CAA and is an
12 individual residing in Los Angeles County, California.

13 4. Defendant Jon Teiber (“Teiber”), is a talent agent with CAA and is an individual
residing in Los Angeles County, California.
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5. Defendant Michael Katcher (“Katcher”), is a talent agent with CAA and is an
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individual residing in Los Angeles County, California
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6. Plaintiff is unaware of the true names and capacities of those defendants sued
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herein as DOE Defendants, and therefore, sue said Defendants by such fictitious names. Plaintiff
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is informed and believes, and thereupon alleges, that each of the Defendants designated herein as
19 a DOE, was and is legally, equitably, or in some other actionable manner, responsible for the
20 events and happenings hereinafter referred to, and thereby negligently, carelessly, with deliberate
21 indifference, or by reason of direct or imputed negligence or vicarious fault or breach of duty
22 arising out of the matters herein alleged, legally and proximately caused the hereinafter alleged

23 injuries and damages to the Plaintiff. Plaintiff will hereafter seek leave to amend this Complaint

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to set forth said true names and identities of the unknown named DOE Defendants when they are
ascertained.
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7. Plaintiff is informed and believes and thereupon alleges that, at all times
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mentioned herein, each of the defendants sued herein was the agent, alter ego, servant, employee,
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successor-in-interest and/or joint venturer of each of the other defendant(s) and was, as such,
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acting within the time, place, purpose, scope, and authority of said agency, service, employment,

2
COMPLAINT
successor-in-interest and/or joint venture and that each and every defendant as aforesaid, when
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acting as a principal, was negligent in the selection, hiring, training and/or supervision of each
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and every other defendant as an agent, servant, employee, successor-in-interest and/or joint-
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venturer.
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8. At all relevant times mentioned herein Defendant Does 1 through 10, inclusive,
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were residents of Los Angeles County and/or businesses or corporate entities incorporated in
6 and/or doing business in the State of California by virtue of the laws of the State of California.
7 9. Plaintiff is informed, believes, and thereupon alleges that CAA, Bugliari, Teiber,
8 Katcher and each of the DOE Defendants (collectively hereinafter known as “Defendants”) are
9 in some manner responsible for the events and happenings herein set forth and proximately

10
caused injury and damages to the Plaintiffs as herein alleged.
10. Each Defendant is the agent, servant and/or employee of the other Defendants,
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and each Defendant was acting within the course and scope of his, her or its authority as an
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agent, servant and/or employee of the other Defendants. Defendants and each of them, are
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individuals, corporations, partnerships and other entities which engaged in, joined in and
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conspired with the other wrongdoers in carrying out the tortious and unlawful activities
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described in this complaint, and Defendants, and each of them, ratified the acts of the other
16 Defendants as described in this Complaint.
17 11. Venue is proper in Los Angeles County, because a substantial part of the events
18 giving rise to Plaintiff’s claims arose, the injuries sustained by Plaintiff, occurred within this
19 judicial district and Defendants are domiciled in this judicial district.

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FACTS COMMON TO ALL CAUSES OF ACTION
12. Howard is an elite award-winning actor, whose career in Hollywood has
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expanded over the course of 30 years. Having appeared in over 50 films and 20 television shows,
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Howard, considered one of the most versatile actors in Hollywood, has landed roles in many
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critically acclaimed block buster hits including Mr. Holland’s Opus, Crash, Ray, The Best Man,
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Iron Man, and his 2005 performance in the film Hustle and Flow which landed him the coveted
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Academy Award Nomination for Best Actor.
26 13. In 2008, Howard entered into an oral talent agency agreement with CAA to be
27 represented, as an actor. Howard agreed to pay CA commissions in accordance with industry
28 customs and practice in exchange for CAA’s services as his talent agent. Specifically, the oral

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COMPLAINT
agreement provided for ten percent (10%) commissions payable to CAA on any monetary sums
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or other consideration which Howard earned or received for any assignments, employments or
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engagements on any project substantially negotiated while Howard was represented by CAA (the
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“Talent Agency Agreement”).
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14. In employing CAA as his talent agency, Howard did not agree to enter into an
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agreement with CAA where he would be in direct competition for funds with CAA and would be
6 left to advocate for himself against his supposed representatives.
7 15. In or around early 2014, Howard was approached by the acclaimed producer,
8 director, writer Lee Daniels (“Daniels”), who at the time had an overall deal with the television
9 network Twentieth Century Fox, about a pilot project, in which was he created along with Co-

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Creator Danny Strong (“Strong”). Like Howard, both Daniels and Strong were also represented
by CAA.
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16. The pilot project was titled “Empire” (the “TV Show” or “Empire”) and Howard
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was offered the lead role as a character named Lucious Lyons, a former drug dealer turned hip-
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hop mogul and the founder and long-time CEO of Empire Entertainment.
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17. Having read the script provided to him by Daniels, Howard contacted his agent
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Bugliari and informed him that he was excited about the prospect of moving forward with
16 Daniel’s project and asked him to begin negotiating a deal on his behalf.
17 18. The production companies hired to produce, and show run the project, was the
18 acclaimed Imagine Entertainment (“Imagine”), Lee Daniels Production (“LDP”) and Danny
19 Strong Productions (“DSP” and collectively with Imagine and LDP the “Production

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Companies”). Again all three production companies were represented by CAA.
19. On or about February 18, 2014, having reviewed the script for the pilot project,
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Howard entered into an Agreement for Pilot and Series Options with Twentieth Century Fox
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Television (“Fox” or the “Network”), where Howard agreed to be paid $125,000 in exchange for
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acting services over a period of three days in order to film the pilot episode (the “Pilot
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Agreement”). In addition, to the initial pilot episode fee, the Pilot Agreement set forth an
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episodic fee schedule for several seasons should the Network choose to pick up the show
26 following the broadcast of the pilot episode.
27 20. The Pilot Agreement was negotiated between the Production Companies and
28 Howard’s agents, who also served as Howard’s legal counsel.

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COMPLAINT
21. During the negotiations of the deal, CAA informed Howard that it was serving as
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the packaging agent for the project, and because of that they were willing to waive their standard
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10% agency. CAA further informed Howard that because they were the packaging agent for the
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project, their compensation was being built into the project’s budget and paid separately.
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22. With great trust in his agents having been working with the agency for nearly 6
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years, Howard, although unfamiliar with the particularities involved in these types of packaging
6 deals, he continued to believe that his agents were serving his best interests at all times, and that
7 it was commendable of them to avoid “double dipping” on fees obtained as the packaging agent
8 and those fees obtained from their actors.
9 23. Despite this feeling of trust, it would be years later that Howard would discover

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that CAA was in fact keeping his best interests at the forefront, and instead placed their own
financial interests, as well as the interests of the Production Companies they also represented
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ahead of his own.
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24. As has been more recently raised in several suits brought by writers, actors and
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other talent, and most notably the Writer’s Guild of America, the packaging fee model of the
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major talent agencies, including CAA, harms both writers and actors.
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25. As described by the WGA, “packaging fees are generally based on a ‘3-3-10’
16 formula, with the upfront fee defined as 3% of the ‘license fee’ paid by the studio for the
17 program, the deferred fee also defined as 3% of the ‘license fee’ paid by the studio for the
18 program, and the profit participation defined as 10% of the program’s modified adjusted gross
19 profits. The ‘license fee’ used to determine that portion of the packaging fee is an amount set by

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the production company or negotiated between the Agency and the production company as part
of the packaging fee agreement.”
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26. As further described by the WGA, “packaging fees generate hundreds of millions
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of dollars per year in revenue for the Agencies—far more than they would earn from a traditional
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10% commission from their clients. The Agencies have used the income generated through
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packaging to raise private capital, and their business has become so lucrative that some Agencies
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are now planning to become publicly held corporations.”
26 27. In this instance, CAA represented Producers Daniels and Strong, the Production
27 Companies and most major actors for the project, excluding lead actress Taraji Henson.
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COMPLAINT
28. While Howard was not privy to all the terms of CAA’s packaging deal, he is
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informed and believes and thereon alleges that as a result of CAA’s representation of most major
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components of the project, their profit participation was significantly larger than the industry
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standard. And while Howard was aware that CAA was packaging the project and receiving a fee,
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Howard had no idea the type of conflicts of interest CAA was faced with by not only having
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their own financial interests incorporated into the project, but they also represented talent and the
6 Production Companies, which have diametrical interests in that producers want to keep the top
7 line production budget as low as reasonably possible, while actors want to be paid the maximum
8 value of their services rendered.
9 29. On January 7, 2015, Empire had its debut broadcast of the Pilot reaching an

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audience of an astounding 9.90 million viewers, marking Fox’s highest rated debut in three
years.
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30. As a result, Empire was an instant success, not only exceeding the Network’s
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viewership expectations, but also bringing in significant praise by critics throughout the
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entertainment industry.
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31. Empire’s grip on American viewers was so significant that in its debut season it
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rivaled the NFL with an overall Nielsen Rating in the coveted 18-49 demographic of 7.1 or 17.33
16 million viewers per episode versus the NFL that had rating of 7.3. In fact, Empire’s
17 unprecedented success was described by Variety Magazine, “[n]o series in the history of
18 Nielsen’s People Meters (going back to 1991) had grown with the first five episodes following
19 its premiere, and “Empire” has now bested that by two weeks.”

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32. Furthermore, as described by Forbes Magazine, Empire was “the most valuable
show on broadcast TV” during its broadcast over six seasons, with the “first runs and reruns of
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the show brought in $125.5 million in ad revenue in 2016 and $124.5 million in 2015” according
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to ispot.tv. The show was a financial bonanza for Fox, the Production Companies and CAA.
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33. Following two seasons of Empire consisting of 12 episodes and 18 episodes
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respectively, it had become clear that given Howard’s star power and the unprecedented success
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TV Show, the Pilot Agreement was woefully under paying him at a rate of $125,000 per episode.
26 34. In or around June 27, 2016, follows the assistance of Howard’s then retained
27 counsel Erik Hyman, Howard was able to renegotiate his per episodic fees by double, although
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COMPLAINT
that was still below the standard of the star lead actor on an extraordinarily popular and
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successful television show.
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35. In or around 2018, as Empire continued to bring in hundreds of millions of dollars
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in profits through advertising revenue, merchandising, and the syndication and resale of past
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seasons through streaming services, Howard once again returned to his agents at CAA requesting
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that his overall salary be increased to reflect comparable compensation packages that are
6 received by his lead actor counterparts for those television shows who have reached similar
7 success as Empire has.
8 36. During a series of communications between Howard and his agents Katcher,
9 Bugliari and Teiber in 2018, Howard’s agents submitted to him a list of comparisons for fees

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received by a number of lead actors, that were presented to him to be within a similar position.
Included in this list were actors Kevin Spacey from House of Cards and John Hamm from Mad
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Men who topped the list at a total episodic fee (including all compensation for acting services)
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for Season 4 of $450k and $350k respectively. As it relates to Hamm, despite making a higher
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episodic fee than Howard, Mad Men’s viewership was a fraction of Empire’s success, only
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averaging approximately 1.3 million viewers per episode. While House of Cards was
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approximately 3 million viewers per episode. The other actors listed from the alphabet networks,
16 did not have ratings remotely close to Howard.
17 37. Because Howard was being represented by CAA, and having no experience as it
18 relates to what a reasonable total episodic fee should be, and further having no access to such
19 information regarding other actors similarly situated as him, he reasonably believed that the

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comparisons that his agents were provided to him were an accurate reflection of what he should
be paid.
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38. Following this discussion, CAA failed to make any good faith effort to assist
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Howard in renegotiating his overall compensation for services rendered to reflect the
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compensation that he should have really been receiving. Their justification for refusing to extend
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such efforts to renegotiate Howard’s total compensation per season, despite representing the vast
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majority of the main actors on the project, was based upon the comparable figures discussed
26 above, that Howard relied upon as an accurate depiction for the lead actor on a show as
27 successful as Empire.
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COMPLAINT
39. Despite Howard’s attempts to discuss the renegotiation of his compensation
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package with Fox, with the support of his agents, those discussions went nowhere.
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40. Although entering into its Sixth Season, Empire was still a massively popular hit
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with ratings still in the 6 million viewers per episode, given the impasse on increasing Howard’s
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fees, and some additional distractions related to other actors on the show, the Sixth Season would
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eventually be the series final season with the last episode airing on April 21, 2020.
6 41. Sometime in or around 2021, Howard discovered that the representations made
7 by his agents regarding the comparisons discussed in 2018 were in fact misleading, as they were
8 presented to Howard as a total compensation fee (beyond just talent fees) per episode, and
9 further they did not actually reflect the fees Howard would have been entitled by excluding other

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broadcast network and streaming shows that were similarly popular such as Game of Thrones,
Gilmore Girls, Big Bang Theory and others.
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42. Had Howard been provided that information, which would have more accurately
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reflected what his compensation should have been, as Howard’s agent, CAA would have been
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duty bound to make their best efforts to renegotiate Howard’s compensation to accurately reflect
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what he should have been paid for such a popular television.
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43. However, not only did it become abundantly clear that his agents led him on a
16 path to rely on information that was misleading, he discovered that this was the result of the fact
17 that CAA was not acting in his best interest, but in the in interest of their own financial benefit as
18 well as the interest of the Production Companies and the producers, Daniels and Strong. Under
19 normal circumstances, had CAA not been the packaging agent, and had CAA not been

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concurrently representing the Production Companies, where their sole financial interest would
have been the 10% fee from the compensation received by Howard, they would have most
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certainly fought for Howard in a manner that most producers are accustomed to seeing CAA
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agents engage in.
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FIRST CAUSE OF ACTION
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BREACH OF FIDUCIARY DUTY
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(As Against All Defendants)
26 44. Plaintiff as if fully set forth herein restates and incorporates by reference, as
27 though fully set forth herein, the allegations contained in each of the paragraphs above.
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COMPLAINT
45. At all relevant times, and as described above, CAA, Bugliari, Teiber and Katcher
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owed Howard the absolute and complete duty of fidelity owed as his agent and agent’s company.
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In particular, CAA had a duty of loyalty and the duty to avoid conflicts of interest and to refrain
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from self-dealing.
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46. CAA, Bugliari, Teiber and Katcher breached their fiduciary duty to Howard by
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engaging in self-dealing by receiving commissions from both sides of a transaction and causing a
6 conflict of interest. CAA further breached its fiduciary duty by recommending its client, Howard,
7 place himself in a transaction that the talent agency would benefit beyond its standard fee from
8 the client. CAA further willfully breached its fiduciary duty to Howard by placing its own
9 interests above that of its client, and by increasing its own profits at the expense of Howard’s,

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which constituted a breach of the duty of loyalty. CAA further willfully breached its fiduciary
duty to Howard with the representation under numerous conflicts of interest without obtaining
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valid, informed consent to those conflicts of interest from Howard, including the representation
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of the Production Companies and producers Daniels and Strong, whose interests were inapposite
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of his. CAA further breached its fiduciary duty to Howard by concealing pertinent and necessary
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financial information about comparisons of similarly situated actors, despite numerous requests
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for full transparency on behalf of Howard on this issue in order to renegotiate his talent
16 agreement for compensation that accurately reflects what he should have received.
17 47. As a direct and proximate result of Defendants’ breaches of fiduciary duties owed
18 to Howard, as a result of CAA’s willful breaches, Howard suffered significant damages,
19 including but not limited to lost wages, lost employment opportunities, and other economic

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losses.
48. Howard is informed and believes that Defendants committed the aforementioned
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acts maliciously, fraudulently and oppressively, with the wrongful intention of injuring Howard,
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from an improper and evil motive amounting to malice, and in conscious disregard of Howard’s
23
rights. Moreover, Howard is informed and believes that CAA’s officers, directors, and/or
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managers authorized and ratified the foregoing wrongful acts. Howard is therefore entitled to
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recover punitive damages from Defendants according to proof.
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COMPLAINT
SECOND CAUSE OF ACTION
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CONSTRUCTIVE FRAUD
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(As Against All Defendants)
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49. Plaintiff as if fully set forth herein restates and incorporates by reference, as
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though fully set forth herein, the allegations contained in each of the paragraphs above.
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50. Pursuant to California Civil Code 1573, constructive fraud consists in any breach
6 of duty, without an actually fraudulent intent, gains an advantage to the person in fault, or
7 anyone claiming under him, by misleading another to his prejudice, or to the prejudice of any
8 one claiming under him. Further, an agent’s breach of his or her fiduciary duty to a principal thus
9 constitutes constructive fraud. Specifically, the failure of a fiduciary to disclose a material fact to

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his principal that might affect the fiduciary’s motives or the principal’s decision constitutes
constructive fraud, regardless of whether the fiduciary acted with fraudulent intent.
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51. At all relevant times, and described above, CAA, Bugliari, Teiber and Katcher
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committed constructive fraud by breaching its fiduciary duty to Howard by placing its own
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interests above Howard’s, and by increasing its own profits at the expense of Howard, which
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constituted a breach of the duty of loyalty. CAA further willfully breached its fiduciary duty to
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Howard with the representation under numerous conflicts of interest without obtaining valid,
16 informed consent to those conflicts of interest from Howard. On information and belief, CAA
17 and defendant agents committed constructive fraud by failing to disclose to Howard material
18 facts known to CAA and defendant agents, which material facts might affect CAA’s motives or,
19 if disclosed to Howard, would have affected Howard’s decision, including but not limited to the

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following: (a) concealing the fact that CAA was profiting directly as producers from the
program’s budget or revenues; (b) concealing the fact of the more accurate comparisons to total
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compensation Howard should have been received based upon his stature and success of the TV
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Show; (c) concealing the fact that CAA intentionally failed to act in good faith to negotiate for
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Howard comparable compensation on the basis that they favored their own interests and the
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interests of the Production Companies and producers Daniels and Strong; (d) concealing the fact
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that CAA generally makes more for shows than Howard is paid for those same shows; and (f)
26 concealing the fact that CAA’s compensation is often tied to the budget of a particular production
27 rather than the amount paid to Howard, and therefore, CAA is incentivized to reduce the amount
28 paid to Howard in order to increase the amount of the budget available to compensate CAA.

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COMPLAINT
52. As a direct and proximate result of Defendants’ breaches of fiduciary duties owed
1
to Howard, as a result of CAA’s willful breaches, Howard suffered significant damages,
2
including but not limited to lost wages, lost employment opportunities, and other economic
3
losses.
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53. Howard is informed and believes that Defendants committed the aforementioned
5
acts maliciously, fraudulently and oppressively, with the wrongful intention of injuring Howard,
6 from an improper and evil motive amounting to malice, and in conscious disregard of Howard’s
7 rights. Moreover, Howard is informed and believes that CAA’s officers, directors, and/or
8 managers authorized and ratified the foregoing wrongful acts. Howard is therefore entitled to
9 recover punitive damages from Defendants according to proof.

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THIRD CAUSE OF ACTION
FRAUDULENT REPRESENTATIONS
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(As Against All Defendants)
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54. Plaintiff as if fully set forth herein restates and incorporates by reference, as
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though fully set forth herein, the allegations contained in each of the paragraphs above.
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55. As set forth in the Second Cause of Action above, at all relevant times, and
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described above, CAA, Bugliari, Teiber and Katcher committed constructive fraud by breaching
16 its fiduciary duty to Howard by placing its own interests above Howard’s, and by increasing its
17 own profits at the expense of Howard, which constituted a breach of the duty of loyalty. CAA
18 further willfully breached its fiduciary duty to Howard with the representation under numerous
19 conflicts of interest without obtaining valid, informed consent to those conflicts of interest from

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Howard. On information and belief, CAA and defendant agents committed constructive fraud by
failing to disclose to Howard material facts known to CAA and defendant agents, which material
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facts might affect CAA’s motives or, if disclosed to Howard, would have affected Howard’s
22
decision, including but not limited to the following: (a) concealing the fact that CAA was
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profiting directly as producers from the program’s budget or revenues; (b) concealing the fact of
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the more accurate comparisons to total compensation Howard should have been received based upon
25
his stature and success of the TV Show; (c) concealing the fact that CAA intentionally failed to act
26 in good faith to negotiate for Howard comparable compensation on the basis that they favored
27 their own interests and the interests of the Production Companies and producers Daniels and
28 Strong; (d) concealing the fact that CAA generally makes more for shows than Howard is paid

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COMPLAINT
for those same shows; and (f) concealing the fact that CAA’s compensation is often tied to the
1
budget of a particular production rather than the amount paid to Howard, and therefore, CAA is
2
incentivized to reduce the amount paid to Howard in order to increase the amount of the budget
3
available to compensate CAA.
4
56. Defendant’s misrepresentations and assurances in this regard were designed to
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entice Plaintiff, at Plaintiff’s significant detriment and expense.
6 57. Moreover, Defendant, at all times, knew that Plaintiff was heavily relying upon
7 the foregoing representations in agreeing to the compensation packages he was provided.
8 58. At the time the Defendant made the foregoing material representations and
9 promises to Plaintiff, such representations and promises were false and, in addition, Defendants

10
had no intention of fully performing under the terms of the Talent Agreement, and knew that all
such representations were false when made.
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59. Plaintiff acted in justifiable reliance upon the Defendant’s material
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misrepresentations, promises and assurances as, at the time Defendant made such
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representations, Plaintiff did not know of the falsity of the representations and, in addition, were
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not aware of Defendants’ complete lack of intention to fully perform as required at all times as a
15
talent agent.
16 60. As a direct and proximate result of Defendants’ breaches of fiduciary duties owed
17 to Howard, as a result of CAA and defendant agent’s willful breaches, Howard suffered
18 significant damages, including but not limited to lost wages, lost employment opportunities, and
19 other economic losses.

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61. Howard is informed and believes that Defendants committed the aforementioned

21 acts maliciously, fraudulently and oppressively, with the wrongful intention of injuring Howard,
22
from an improper and evil motive amounting to malice, and in conscious disregard of Howard’s
23
rights. Moreover, Howard is informed and believes that CAA’s officers, directors, and/or
24
managers authorized and ratified the foregoing wrongful acts. Howard is therefore entitled to
25

26 recover punitive damages from Defendants according to proof.

27 WHEREFORE, Plaintiff prays for judgment against the Defendants as follows:


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i) For compensatory, general, and special according to proof.

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COMPLAINT
ii) For exemplary and/or punitive damage as permitted by the law
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i) For Pre-judgement and Post-judgment interest;
2
ii) For costs of suit herein occurred;
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iii) For such other and further relief as the Court may deem just and proper.
4

6 THE COCHRAN FIRM CALIFORNIA

8 Dated: December 7, 2023 /s/ James A. Bryant


_____________________________________
JAMES A. BRYANT, ESQ.
9
CARLOS E. MOORE, ESQ.
10 Attorney for Terrence Howard

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COMPLAINT

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