Willie E. Gary, Esq. Maria Sperando, Esq William C. Campbell, Esq. Laura L. Mall, Esq.

GARY, WILLIAMS, PARENTI, FINNEY, LEWIS, WATSON & SPERANDO 221 E. Osceola Street Stuart, FL 34994 Tel: (772) 283-8260 Fax: (772) 221-2177 Attomeys for Plaintiffs Rowe Entertainment, Inc., et al.

CHAMH!.’:b OI JUDI;! ROP~ ~:: I’. PAIIERSO~,,

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK

ROWE ENTERTAINMENT, INC. et al., Plaintiffs,
VS.

NO. 98-CV-8272 (RPP)

THE WILLIAM MORRIS AGENCY, INC. ET AL., Defendants

PLAINTIFFS’ MEMORANDUM OF LAW IN OPPOSITION TO BOOKING AGENCY DEFENDANTS’ JOINT MOTION FOR SUMMARY JUDGMENT

TABLE OF CONTENTS

STATEMENT OF FACTS ............................................................................................................................ 3 A. DEFENDANTS ENGAGED IN A CONSPIRACY IN RESTRAINT OF TRADE OR COMMERCE IN VIOLATION OF 15 USC SECTION 1 ......................................................... 4 1. There Are Genuine Issues Of Material Fact As To Whether A Conspiracy Violating The Sherman Act Exists In The Facts Underlying This Case ............................................... 4 There Are Genuine Issues of Material Fact As To Booking Agency Defendants’ Claim Of An Open, Fair And Competitive Bidding Process ................................................ 7 a. Dominant Promoters Together Control All Major Local Markets, Venues and Territories ....................................................................................................................... 7 8 b. Higher Guarantees And Deposits Were Required of Plaintiffs ....................................... c. Misleading, False And Inaccurate Information .............................................................. 11 d. The Real Circumstances Are Illustrated By Contracts, Not Bids ................................... 12 e. Defendants’ Conspiracy And Monopoly Are Economically Plausible .......................... 13 PLAINTIFFS PRESENT SUFFICIENT EVIDENCE TO SHOW VIOLATION OF 42 USC SECTION 1981 .................................................................................................................. 15 a. Statistical Evidence Can Be Used By The Jury To Establish A Pattern Of Discrimination ................................................ : ................................................................ 17 b. Booking Agency Defendants Select And Substantially Control The Process Selecting Promoters ......................................................................................................... 9 1
Co

Promoter D~fendants Knowingly Participate In And Benefit From The Conspiracy To Exclude Black Promoters And Do Not Compete With One Another While Engaging In Other Anti-Competitive Actions ........................................ 20

d. Territorial Monopolies By Dominant White Promoters ................................................. 21 e. Racially Disparate Treatment Of Plaintiffs ..................................................................... 23 2 C. DEFENDANTS VIOLATED 42 U.S.C. 1985(3) ....................................................................... 6

CONCLUSION ................................................................................................................................. 35

TABLE OF AUTHORITIES FEDERAL CASES Adickes v. Kress & Co., 398 U.S. 144, 157, 26 L.Ed 2d 142, 90 S.Ct. 1598 (1970) ....................... American Manufacturers Mutual Insurance Co. v. American Broadcasting-Paramount Theatres, Inc., 388 F.2d 272 (2d Cir. 1967) .......................................................................... Anderson v. Liberty Lobby, Inc.,477 U.S. at 248, 106 S.Ct. at 2510 ................................................ Apex Oil Company v. DiMauro, et al., 822 F.2d 246 (1987) ............................................................ Austin v. McNamara, 979 F.2d 728, 739 (9th Cir. 1992) .................................................................. Bhan v. NME Hospitals, Inc., 929 F.2d 1404, 1409 (9th Cir.), cert. denied, 112 St.Ct. 617 (1991) ........................................................................................ Broadcast Music, Inc. v. CBS, 441 U.S. 36, 49-50 (1977) ............................................................... Brown v. County of Oneida, No. 99 Civ. 1064, 2000 WL. 1499343 (NDNY Sept. 28, 2000) ......................................................................................................... 28

28 4 3 33

32 33

4 25 28 27

o@

Byars v. Jamestown Teachers Association, 195 F.Supp. 2d 401,417 9.W.D.N.Y. 2002) ............... Cali v. Eastern Airlines, Inc., 422 F.2d 65, 71 (2d Cir. 1971) .......................................................... Camelio v. Walmart Stores, Inc., 15 F. Supp. 2d 268,269 9 (W.D.N.Y.’ 1998) ............................... Capital Imaging Associates, P.C. v. Mohawk Valley Medical Associates, Inc., 996 F. 2d 537 (2d Cir. 1993) .............................................................................................. Chicago Board of Trade v. United States, 246 U.S. 231,238 (1918) ............................................... City of Richmond v. J.A. Croson Company, 488 U.S. 469 (1989) .................................................. Donaldson, LuJkin & Jenrette Sec. Corp., 7 F.3d 1085, 1087 (2d Cir. 1993) ................................... Donnelly v. Guion, 467 F.2d 290, 291 (2d Cir. 1972) ..................................................................... Faraca v. Clements, 506 F.2d 956 (5th Cir.) cert. denied 422 U.S. 1006 .......................................... Frooks v. Town of Cortlandt, 997 F.Supp. 438 (S.D.N.Y. 1998) ..................................................... Furnco Construction Corp. v. Waters, 438 U.S. 567, 580 (1978) ....................................................

34 33 i. 18 15 30 19 26 17

ii

Hayden Publishing Co. v. Cox Broadcasting Corp., 730 F.2d 64, 68 (2d Cir. 1984) ......................32 HCA Health Services of Ga., Inc. v. Employers Health bzs. Co., 240 F.3d 982, 991 (11th Cir. 2001) ........................................................................................ 30

Heyman v. Commerce and Industry Insurance Company, 524 F.2d 1317 (1975) ............................ 30 Johnson v. Railway Express Co., 421 U.S. 454, 459-60 (1975) ....................................................... 15 3 Klor’s, Inc. v. Broadway-Hale Stores, b~c., 359 U.S. 207, 211-12 (1959) ....................................... 3 Lyoch v. Anheuser-Busch Co., 164 F.R.D. 62, 66 (E.D. Mo. 1995) .................................................17 Patterson v. McLean Credit Union, 492 U.S. 164, 177 (1989) ........................................................ 15. Perry v. Manocerhian, 675 F. Supp. 1417 (S.D.N.Y. 1987) .............................................................27 Robinson v. Union Carbide Corp., 538 F.2d 652 (5th Cir. 1976) ...................................................... Sagers v. Yellow Freight System, Inc., 529 F.2d 721,729-30 (5th Cir. 1976) ................................... Sweat v. Miller Brewing Co., 708 F.2d 655,658 (11th Cir. 1983) .................................................... 17 17 17

Taylor v. Gilmartin, et al., 686 F. 2d at 1346 (1982) ....................................................................... 27 Thomas v. Roach, 165 F.3d 137, 146 (2d. Cir. 1999) ....................................................................... 2, 26 United States v. Dieabold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994...’. ......................................... 4, 29 United States v. Topco Associates, 405 U.S. 596, 609 (1972) .........................................................33 Vakharia v. Swedish Covenant Hosp., 765 F. Supp. 461 9 (N.D. ILL. 1991) ...................................19 FEDERAL STATUTES 4 15 U.S.C. Section 1 .......................................................................................................................... 42 U.S.C. Section 1981 .....................................................................................................................14 42 U.S.C. Section 1985(3) ................................................................................................................ 25, 27 OTHER AUTHORITIES 14, Report of Dr. Gerald Jaynes .................................................................................................. 18, 33 1 Report of Dr. Joe R. Feagin ............................................................................................................... 5 29. Wright & Miller, Federal Practice and Procedure (1998), § 2727 ..................................................

iii

Preliminary Statement Plaintiffs Rowe Entertainment, Inc., Leonard Rowe ("Rowe"), Sun Song Productions, Inc., Jesse Boseman ("Boseman"), Summit Management Corporation, Fred Jones, Jr. ("Jones"), Lee King Productions,

Inc., and Lee King ("King"), respectfully submit this memorandum of law opposing the joint summary

judgment motion of The William Morris Agency, Inc. ("WMA"), Creative Artists Agency, LLC ("CAA") and Renaissance Entertainment, Inc. ("Renaissance") (collectively the "booking agency defendants"). 1

The plaintiffs in this action have repeatedly, consistently and continuously presented facts that prove

booking agency defendants (together with other defendants) violated antitrust and civil rights laws

Defendants’ intentional actions mean black promoters have neither a fair opportunity to bid nor actual contracts to promote certain black and virtually all white acts. The record is replete with facts to demonstrate violations of federal law. Booking agency defendants

inadequately contest the facts and give tortured explanations to cover up their violations of plaintiffs’ rights They seek to complicate what is actually simple (or at least straightforward). Defendants denied contractual

opportunities to black promoters using their unique position in representing artists and their control of local markets. The record shows that when the booking agents and dominant white promoters act together, plaintiffs cannot get a contract. Moreover, the defendants continue to do so today. Despite their vehement disclaimers to the contrary, booking agency defendants exercise outright control in the award of contracts for promotion, tour and other business that the plaintiffs sought and seek.

Booking agency defendants are in a unique position to initiate, monitor, control, influence, affect the tim.in and content of, conceal, interrupt and shut down communication that is essential to black promoters obtaining contracts. They are, in effect and practice, the gatekeepers for all access to participation in the’ industry. The

result for black promoters underscores the effectiveness of the conspiracy in avoiding and limiting black participation in contracts to promote significant black and white artists.

~ Plaintiffs have also submitted separate statements of contested (disputed) material facts and memoranda of law opposing the motions for summary judgment of the other defendants and individual booking agency defendants. Said statements of contested (disputed) material facts and memoranda of law are incorporated here by reference and adopted as a part of plaintiffs’ opposition to booking agency defendants’ motion for summary judgment.

1

Booking agency defendants argue the fiction that they do not select promoters. By contrast, the reality is that booking agency defendants are paid to and do make decisions instead of the artist. It is the rare

exception for the artist to assert his "ultimate" authority to select a promoter. The booking agency defendant either make the decision or control the information an artist uses in the rare case where the artist participates. The booking agency is the de facto decision maker. To reach the proper result in this case, the Court should

reject defendants’ theoretical view of the concert promotion business and view the reality of how and to whom contracts are awarded. In fact, remarkably, only two artists have given testimony in ~his case: Bill Cosby and Marion Jackson. During a career that spans over 40 years, Mr. Cosby testified that he worked with approximately 3,000 promoters, but had personally selected perhaps only 10 of those promoters. Cosby Dep. at 32, Ex. 1. Further, he estimated that the WMA selected 90% of the promoters. Similarly, Mr. Jackson said over his 30 years in the music business while touring with the Jackson 5 and The Jacksons, the agency almost always selects the promoter. Jackson Aft. at 1, Ex. 2. Both witnesses are unchallenged by any contrary evidence which refutes the specious notion by defendants of their limited role in the selection of promoters. The record shows booking agency defendants participated in a conspiracy to deny plaintiffs business opportunities and contracts to promote major black and white acts. Exact records (and other smoking guns) are rare when improper conspiratorial activity takes place.2 In this case, however, the plaintiffs’ record sufficiently proves not only the existence of the conspiracy, but the effect--limited and rare participation for the black

plaintiffs in promoting black superstar artists represented by booking agency defendants and virtually, no

participation in promoting white artists. The sufficiency of the plaintiffs’ record and the inferences th reasonably may be drawn from it require denial of the defendants’ motion for summary judgment. Consistent with allegations in the Amended Complaint, the record now establishes: (i) There is direct evidence of booking agency defendants’ conspiracy in concert with other defendants;

~l’heCourt in Thomas v. Roach, 165 F.3d 137, 146 (2d. Cir. 1999), explained that a conspiracy need not be shown by proof of an explicit agreement; rather such a conspiracy can be established by showing that the parties have a tacit understanding to carry out the prohibited conduct. ""

2

(ii)

The conspiracy by booking agency defendants, inter alia, was motivated by racial animus and resulted in the restraint of fair trade and competition. The booking agency defendants did not produce a single contract where any black promoter was awarded a contract to promote any artist on the same terms and basis as white promoters. Neither Fred Jones nor any other black promoter nor plaintiff has been the sole or lead promoter with a contract for a white artist. In any case where a black promoter "worked on" such a concert, it was in spite of, not because of, booking agency defendants.

(iii)

(iv)

Plaintiffs are known to defendants. Moreover, the record includes sworn statements of defendants and others confirming plaintiffs to be "qualified" promoters who have promoted national tours, including famed Jackson 5 member, Marion Jackson, who said plaintiff Rowe was one of the best promoters in the industry.

(v)

Thousands of contracts evidence racially disparate treatment of plaintiffs by booking agency defendants: not informing plaintiffs of touring dates; misleading plaintiffs with respect availability of artists; routinely quoting higher deposit amounts and, incredibly, accepting lower bid prices for their clients’ tours from white promoters than what was offered by plaintiffs; all in violation of discrimination and antitrust laws;

(vi)

In a shocking and brazen display of defendants’ concerted action, the first opportunity for an African-American to control promotions at a major market venue (Memphis’s Mud Island) was crushed by booking agency defendants together with others in violation of discrimination and antitrust laws; Booking agencies select promoters. The only artists to testify in this case, Bill Cosby and Marion Jackson, conclusively destroy any contrary fiction proffered by defendants.

(vii)

(viii) Non-party black promoters, Alan Haymon and Bill Washington, often cited by booking agency defendants, directly accuse them of discriminatory and racist business practices.

While plaintiffs need not prove their case here, a mountain of evidence, both direct and circumstantial, now

exists which undergirds the central allegations of plaintiffs’ Amended Complaint. The record is inundated

with facts that demonstrate violations of federal discrimination and antitrust law. Thus confronted, defendant

resort to legal sophistry: attacking spurious issues that are incidental to their illegal conduct. The Cour

should not allow defendants’ strategy to substitute for evidence or their motion for trial.3 The genuine issue ~of material fact in dispute require denial of defendants’ motion. I. STATEMENT OF FACTS

Given disputed material facts, the plaintiffs are entitled to denial of defendants’ motions as a matter of

law. Summary judgment is only appropriate if there is "no genuine" issue of fact or as stated another way by the U.S. Supreme Court, "[when]...reasonable minds could not differ as to the import of the evidence..."
3 Apex Oil Company v. DiMauro, et al., 822 F.2d 246 (1987).

3

Anderson v Liberty Lobby, Inc. 477 U.S. at 248, 106 S. Ct. at 2510. The moving party has the burden of

proof. "In light of this burden, any inferences to be drawn from the facts must be viewed in the light mos favorable to the non-moving party." United States v. Dieabold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994. See also Brown v. County of Oneida, No. 99 Civ. 1064, 2000 WL. 1499343 (NDNY Sept. 28, 2000). A. DEFENDANTS ENGAGED IN A CONSPIRACY IN RESTRAINT OF TRADE OR COMMERCE IN VIOLATION OF 15 USC SECTION 1. 1. There are genuine issues of material fact as to whether a conspiracy violating the Sherman Act exists in the facts underlying this case. A Sherman Act violation exists when two or more persons through concerted action cause an

unreasonable restraint in interstate or foreign trade or commerce or trade.4 The defendant booking agenc and promoters did and continue to engage in a longstanding conspiracy to deny contracting opportunities for

the African-American plaintiffs, their companies and other competitors to promote major acts. Affidavit of former WMA employee, Richard Johnson ("Johnson Aff.")January 19, 2001, at.l-4; Ex. 3. Although compelling evidence abounds throughout, the clearest example of the conspiracy and

booking agency actions supporting it are the facts involving plaintiff, Fred Jones, an African-American promoter, and his efforts toward an exclusive promoting contract for the Memphis Mud Island venue.5 From the 1993 through 1997 concert seasons, Mr. Jones, through his company plaintiff Summitt Productions, Inc., was a joint venture partner with a white promoter, Rob Kelly.6 In that period, the joint venture exclusively promoted concerts at the Mud Island venue under an agreement. Jones Decl. at 8, Ex. 4 7 . M_l’. Kelly died on March 27, 1998. With directly relevant experience gained through the joint venture, Mr. Jones sought (without the

involvement of a white promoter) an extension of the arrangement through the City of Me’mphis and its

4 15 USC Section 1. 5 If Mr. Jones’s efforts had not been stopped as a result of defendants’ illegal conspiracy, he would have become the first and only black promoter to have such an arrangement in the country. For the first time, a black promoter could have been the dominant promoter in a major concert market. ~ Jones owned a minority 1/3 share of the joint venture; Kelly owned the majority 2/3 share. 7 Mayor Herenton approved the initial agreement in 1993 and in 1995, approved an extension through. 1997. Herenton Dep. at 59 and 65; Ex. 3).

4

Memphis Parks Commission ("MPC"). 8 Finalizing such an agreement with Jones required approval by both the MPC and the Mayor of Memphis. Mr. Jones recalled a meeting and conversation on April 17, 1998, with Dr..Willie W. Herenton, Mayor of Memphis. Id.__:. at 13. In that meeting, Jones expressed his intent to obtain the contact extension alone and the mayor expressed no objection to extending the contract with Jones. Moreover, the mayor did not voice any public policy objection to such a contract whether it was with Jones or any other party. Id.. In his deposition in this case, Mayor Herenton also agreed that he and Jones discussed allowing Jones to have an exclusive at Mud Island for 1998 and beyond. Herenton Dep. at 36, Ex. 5. On April 20, 1998, days after Jones’s discussion with Mayor Herenton, the MPC actually voted to approve the contract arrangement with Jones, without objections from Mayor Herenton. Jones Aft. at 26; Ex. 6. Later that day, on April 20, Mr. Jones began informing each of the booking agency defendants of his

imminent arrangement by facsimile Id. at 26. Jones did not directly inform, communicate, or otherwise share this information with defendant Beaver Productions, Inc. ("Beaver") or any other white promoters. Jones Aft. at 31. However, given the existence of regular contacts and ongoing business between booking agency defendants and dominate white promoters like Beaver, one can infer reasonably that one or more of the booking agents shared Jones’s letter with Beaver or otherwise communicated the fact that an exclusive contract for Mud Island promotions was going to Jones. On April 20, 1998, the same day as Jones’s letter to the agents was received, Barry Left, an executive of defendant white promoter Beaver authored a letter to the MPC. Ex. 7. Prior to sending this letter, Left conferred with Beaver’s owner, Don Fox, who attended Kelly’s memorial service, which was also attended by

representatives of booking agency defendants, including Shelly Shultz of WMA. Both Fox and Left indicated in their respective depositions for this case that industry people discussed the Memphis market. Fox Dep. at 27-29; LeffDep. at 15, 34; Ex. 8 & 9. In substance, Mr. Leff’s letter stated: -Beaver’s recommendation against awarding the exclusive arrangement to Mr. Jones, -The powerful encouragement of booking agency defendants for Beaver to expand into Memphis market, -Beaver’s plans to expand from New Orleans into the Memphis market after Mr. Kelly’s death,

8 Interestingly, booking agency defendants’ joint memorandum of law ("BAD memo") points to Jones’s promotion activities (in the joint venture with Mr. Kelly) as evidence that black promoters have and can promote white acts. BAD memo page 8.

5

-Beaver’s reason for not entering the Memphis market prior to that time because of its "relationship" with Kelly and -A boycott threat against the Memphis concert market, if Jones’s exclusive contract is finalized. While Mr. Leff’s letter arrived too late to affect the MPC vote, it accomplished its conspiratorial goal-denying Jones the contract. This is obvious because Mr. John Malmo, in a letter dated April 22, 1998, and as the Chairman of the MPC Board, advised Mr. Jones that "Mayor Herenton told me yesterday that [Herenton] believes it is unwise for the MPC Board to sign an exclusive contract for booking the Mud Island Amphitheater for the 1998 season." Jones Aff. at 32. As a result, Mr. Jones lost the agreement to promote at Mud Island and all other related business. Beaver Productions moved swiftly into the Memphis market and is now the dominant promoter there. (Rowe Dep. at 1277, Ex. 10). Through the concerted action described above, the booking agency and promoter defendants effectively denied Jones the contract for Mud Island. Contemporaneous with the conspiracy to deny Jones the contract extension, on April 17, 1998, WMA agent, Shelly Shultz, canceled a James Taylor concert that was scheduled for June 23, 24, 1998 at the Mud Isla~ad Amphitheater. WMA selected Beaver (the dominant promoter in New Orleans not Memphis) as promoter and shifted the show to the Memphis area Mid-South Coliseum. ( Copy of letter from Shelly Schultz to Susan Green, Ex. 11). Both venues (Mud Island and Mid-South) serve the metropolitan Memphis area. But for the change of venue by WMA, Jones would have been the promoter for a white artist. Discriminatory and anti-competitive intent are evident in defendants’ actions. 2. There Are Genuine Issues Of Material Fact As To Booking Agency Defendants’ Claim of An Open, Fair And Competitive Bidding Process. In this case, the record presents two irreconcilable descriptions of how promoters are awarded contracts. Defendants offer the Court a description of a fair, open and competitive bid process that is objective. To th~ contrary, the plaintiffs’ evidence exposes a process that is unfair, closed and operated th~-ough booking

agency defendants’ manipulation of procedures and communications (with the assistance of white dominan promoters) to lock out the plaintiffs. The fact descriptions below illustrate a number of concepts, practices and techniques used by defendants in their conspiracy to deny plaintiffs contracts. These methods employed by defendants are the means to both execute the antitrust and discrimination conspiracy.

¯

6

a. Dominant Promoters Together Control All Major Local Markets, Venues and Territories Richard Johnson was an employee of WMA from 1977 to 1986, and was a booking agent during the

last four years of his tenure. In his sworn statement, this former employee said "...the "competitive industry"

described by defendants [in this case] simply does not exist." Johnson Aff. at 2.9 Mr. Johnson explained tha each major market is controlled by one primary or dominant promoter. Bruce Kapp, a veteran promoter with

30 years experience, likewise confirmed the regional, territorial domination of local promoters. (Kapp Dep. at 230-35; Ex. 12). In fact, after naming the recognized dominant promoters in several markets, Johnson swore

under oath that there was no competitive bidding process in arranging deals for WMA’s white artists wanting to perform a concert in one or more cities or to stage a nationwide tour.m° Johnson Aft. at 3. While the booking agency defendants deny any conspiracy, Robert R. Light of CAA admitted to the existence of local market dominant promoters. Light Dep. at 73-76, Ex. 13.ram Although Light noted exceptions, he confirmed the practice of the local dominant promoters not to compete in the locally controlled markets, regions or territories of other dominant promoters. Light Dep. at 7576. Light graphically wrote to one promoter, "You’re always asking me to protect you in your market..." Ex. 13 The dominant white promoters did not compete with one another and conspired with booking agency defendants to deny black promoters opportunity and actual business. Rowe Dep. at 805-806. Johnson described the relationships between booking agents and each regionally dominant promoter as "unbreakable."

Additionally, his sworn statement presented the fact that WMA gave lucrative business to the dominant

9 Mr. Johnson is not a party to this action and has no interest in its outcome. He is currently an attorney licensed to practice law in the State of New York. 10 Johnson swore that some of the dominant promoters were Delsener/Slater (New York City), Electric Factory (Philadelphia) and Pace (Houston). Plaintiff Rowe declared Beaver Productions, Inc. ("Beaver") as the dominant promoter in New Orleans Rowe Decl at 9 and Plaintiffs’ Revised Stmt of Contested Facts in Opposition to Beaver motion for summary judgment at page

3) Mr. Light did so in specifically discussing acquisitions of a number of such dominant promoters by SFX and identified the i1
market each promoter controlled: Delsener/Slater (New York), Don Law (Boston), Electric Factory (Philadelphia), Concert Southern (Atlanta) Cellar Door (Detroit & Florida), Belkin Productions (Cleveland), Contemporary Productions (St. Louis & Kansas), Page Productions (Texas), Avalon Productions (Los Angeles), Bill Graham Presents (San Francisco) and TNA Productions (Toronto). Light’s testimony estimated that with these promoters SFX "probably control 60 to 70 percent of the marketplace." Light Dep. at 73:20-22.

7

promoters to ensure the same operative would also promote less prominent or unknown acts.12 Johnson Aft. at 2-4; Rowe Decl. at 7-9; Ex. 14. This evidence from a former employee of defendant WMA is illustrative of a pattern and practice of anti-competitive actions by the defendants in this case. b. Higher Guarantees And Deposits Were Required Of Plaintiffs In the concert business, promoters (at least theoretically) are buyers of talent. The financial terms are

critical to a promoter’s ability to buy talent. Booking agency defendants held plaintiffs to significant

disadvantageous financial terms as compared to terms available to and actually paid by dominant promoter defendants. The record in this case presents numerous facts that prove defendants repeatedly asked plaintiffs for higher financial guarantees and deposits for artists, as compared to demands of and actual payments by promoter defendants who remain in this case and other dominant white promoters. In some instances, it was

unreasonable for plaintiffs to bid, and in other instances plaintiffs’ higher bids were ignored, to the detrimen of the artists and fair trade. During the selection process for the 1998 Janet Jackson Tour, booking agency defendant CAA used the higher guarantee and deposit practice to deny contracts to the plaintiffs. Mr. Rowe initially discussed with Rob Light of CAA the planned tour and opportunities for black promoters to participate in February, 1998. Mr. Light confirmed the plan for a tour and advised Rowe that the minimum guarantee was $300,000 per concert, with a prior to first on sale date deposit of 50% and the remainder being secured by an irrevocable letter of credit, also prior to the first on sale date from a financial institution. He also assured Rowe of black promoter inclusion. Mr. Rowe submitted a bid that met CAA’s criteria on February 10, 1998. Light Dep. at 114; Rowe Dep. at 1430; Ex. 14. Rowe’s letter made a firm offer for 29 dates with a guarantee of $300,000 per concert.~3 After a conversation with Mr. Light, Mr. Rowe confirmed his interest in certain m~rkets by letter dated February 20, 1998. Ex. 15. On February 25, 1998, Magicworks, a former defendant in this action, submitted a bid to CAA for the 1998 Janet Jackson Tour Letter from Brad Wavra to Carole Kinzel, Ex. 16. The Magicworks offer included

~2 See also Kapp. Dep. at 171. ~3 Tom Ross, then Director of Music for CAA, testified he was unaware of any reason to believe Rowe could not fulfill his offer. Ross dep. at 265

8

40 concerts with an average guarantee of $275,000 per concert, $25,000 less per concert than the offer of plaintiff Rowe. Also, Magicworks faxed several other versions of their offer; but all versions proposed a smaller average guarantee per concert, less money up front and no letter of credit when compared to Rowe’s offer. Light sent a fax to Rowe on March 4, 1998, which repeated CAA’s demand that Rowe submit a bid with ~it least a 50% deposit, an irrevocable letter of credit for the balance and a desire to have all offers in by

close of business that same day. Ex.17.~4 In his declaration, Light described Rowe’s offer as incomplete and

deficient with regard to financing, ticket prices, venues, partnership opportunities and other terms. Light Decl. at 8-9, Ex. 18 Magicworks’ initial offer dated January 27, 1998, like Mr. Rowe’s letter, did not detail

financing terms or list specific venues. However, it apparently was not considered "deficient" because the process culminated with the award of the contract to Magicworks on less stringent terms than the Rowe offer and on less stringent terms than Light communicated in writing to Rowe on March 4. Ex. 19. An examination of the documents illustrates the true intent of CAA. A March 3rd draft from Janet

Jackson’s lawyer to Magicworks with a copy to Carol Kinzel of CAA virtually finalizing the Magicworks dea for the Jackson tour was evidence that Rowe’s offer was not being considered, in spite of the patronizing language to Rowe from Rob Light that "all interested parties are being given tl~e same parameters." Ex. 20. On March 4, the deal was done with Magicworks; yet Rowe was still being asked by Light to make an offer on the same day. Additionally, the tour went to Magicworks with less than a 50% guarantee and no letter of direction. Light Dep. at 129 and Ex. 11 thereto. The grim reality is that Rowe was bamboozled; Light and CAA did nothing to seek black promoter involvement in the 1998 Janet Jackson Tour. His communications with Leonard Rowe were misleading and obv.iously different from CAA’s dealings with Magicworks. The letter to Rowe was a patent sham, a mere pretense for fair treatment. The actions of CAA were discriminatory and anti-competitive.

In connection with another tour involving black artist Toni Braxton and white artist Kenny G in 1997, CAA made similar misrepresentations to plaintiff Rowe. Rowe Dep. at 1385. Rowe made inquiry concerning
~4 In effect, the cash deposit and the letter of credit are actually a 100% deposit.

9

plaintiffs’ desire to promote her concerts in October, 1996. Rowe Dep. at 1384. Rowe was advised by Mike Piranian of CAA that minimum artist guarantees were $225,000 to 275,000 per show. He was also told that a 50% deposit was required upon contract signing. Rowe Dep. at 1381-1382. Plaintiffs later learned that the defendant promoters were required to guarantee only $150,000 to $175,000 per show. The contracts for those white dominant promoters who actually promoted the concert list deposits between 0% and 10%. Contracts, Composite Ex. 21. As a result of the inordinately large deposit amounts demanded by booking agency defendants, no

black promoters, including the plaintiffs, submitted a bid for the tour. In order for plaintiffs to have bid successfully for 10 of the Braxton shows at $250,000 per show, plaintiffs would have .been required to deposit not less than $1,250,000. In contrast, defendant white promoters were required to deposit either nothing or at the maximum, 10% of $175,000 for a single show, or a total of $175,000 for 10 shows. The booking agency defendants WMA and CAA (who each represented one of the two acts), thus required that plaintiffs post over $1,000,000 more than white promoter defendants for 10 shows, which was again discriminatory and anticompetitive.

In another example, plaintiffs were denied participation in the 1999 Maxwell tour after submitting a higher bid. In July, 1998, plaintiff Rowe called Jeff Frasco, Maxwell’s agent at WMA to seek the opportunity for him and other members of the Black Promoters Association ("BPA"), to participate in promoting the 1999 Maxwell tour. Rowe Aft. at 16, Ex. 22. Frasco confirmed that the tour was being planned and promised to include black promoters on the tour. Id. Rowe then submitted a bid to WMA. Letter from Leonard Rowe to WMA dated July 20, 1998, Ex. 23. Rowe did not receive a response to his offer. Rowe Aft. at 21. WMA’s summary of bids received did not even list Rowe’s offer, but a comparison shows Rowe’s offer~ to be higher. Ex. 24. Accepting Rowe’s offers would have produced a figure that was $85,000 greater for the cities Rowe included as compared to offers made by dominant white promoters who actually were awarded the tour. Ex. 25. By not even listing Rowe’s bid among the others, it is clear that WMA never had any intent to accept it or even to send it to the artist or his manager. WMA thus eliminated any chance of Rowe’s selection and

@

10

provided no evidence that it was ever communicated to the artist or his manager. Once again, the agency effectively selected the promoter by its total control of the bid process. In an open, fair and competitive bid process for the Maxwell tour, Rowe would be expected to win or

at least negotiate for all of the 7 cities in his offers. In reality, WMA did not list Rowe’s bids in its files, d not contact him and awarded a contract to each of the dominant promoters in his or her respective market.15 This result belies defendants’ claim of any kind of competitive bidding process. e. Misleading, False and Inaccurate Information

In early 1997, plaintiff Jesse Boseman telephoned Erykah Badu’s agent, Cara Lewis at WMA, (who personally knows Boseman) and asked to promote Badu’s concerts at either of two New York City venues on specific dates. Boseman Dep. at 406; Ex. 26. Lewis denied that Badu was scheduling concerts. In March, 1997, Mr. Boseman asked Ron Delsener of Delsener/Slater to telephone Lewis and to inquire whether Badu was scheduling concerts. Id. at 405. Delsener then telephoned Lewis, in the presence of Boseman, and was informed that Badu was in fact scheduling concerts. Id. at 406. Delsener then obtained from Lewis the right to promote a May 1997, concert to be given by Badu at the Supper Club in New York City. Ex. 27. Such

"testing" evidence in the context of a real estate transaction would be dispositive on the issue of racial bias. After Badu’s second album was released in November 1997, the BPA telephoned Lewis at WMA to request concert dates for Badu’s 1998 tour. Lewis assured the BPA that there were no concert dates planned. Within a month thereafter, however, white promoter defendants were assigned numerous Badu tour dates by William Morris. Ex. 27. Using the techniques from the fact situations described above, defendants placed high artificial barriers to discourage black promoters and fed promotion contracts to the white promoter defendants. Even when black promoters submitted bids, they were characterized as deficient or incomplete and, in any case, ignored in favor of directing contracts to promoter defendants. In some cases, black promoters were orally promised participation, but that participation either did not materialize or was more limited than the promise.

~5 Magic Johnson Productions, Inc. was added to the tour award as a co-promoter after the white dominant promoters were selected and after this lawsuit was filed to ameliorate the public impact of this litigation.

11

d.

The Real Circumstances Are Illustrated By Contracts Not Bids

In their memorandum and statement of facts, the defendants emphasize the importance of bids and

argue plaintiffs have submitted few bids, although the law does not require numbers. Bids, however, are not the key to understanding the violations that have occurred in this system, contracts are. Promotion contracts

produced by the defendants in discovery tell the whole story. Plaintiffs have reviewed a random sampling o contracts and divided them into three groups: 1) contracts with black promoters, 2) contracts with white promoters with 0% or 10% deposit requirements and 3) contracts with white promoters with 50% deposit requirements. There are a total of 1,747 contracts. Of the total, there are 1,738 contracts with white promoters and only 9 contracts with 3 black promoters. The only black promoter with a signed contract is Alan Haymon. Interestingly, all of the contracts with the black promoters required a 50% deposit. Of the 1,738 contracts with white promoters, 1,725 required a 0% or 10% deposit, and 13 required a 50% deposit. Of those 13 contracts with white promoters requiring a 50% deposit, the deposit was waived in every contract. The disparity in the treatment of black promoters compared to white promoters is discriminatory. Pollstar data also illustrates how in reality black promoters are not able to overcome the conspiracy and obtain contracts. Of the top 200 grossing concerts for each of the years 1993 through 2001, only one concert was promoted by a black promoter (number 198 in 1998). Ex. 28’ The discrimination against

plaintiffs may be inferred from the evidence of total exclusion from promoting white and major black acts. Bruce Kapp, a seasoned promoter, stated his belief that there is a prevailing prejudice against black promoters in the concert promotion industry with respect to promoting white artists. Kapp Dep. at 254-255. More importantly, the domination of booking agency defendants in the concert promotion business is shown by other Pollstar data for contemporary music concerts in the United States from June, 1998 to May, 1999 in venues with more than 3,000 seats shows that 2460 concerts occurred (not one white show was promoted by a black promoter): Id. White performers: Black Performers: Hispanic Performers: Total: 12 2175 250 35 2460

Of those 2,460 concerts, 1,500 or 61% were performed by artists represented by the booking agency defendants and 1466 or 60% were promoted by the concert promoter defendants remaining in this case. As such, they are largely responsible for the discrimination affecting the plaintiffs. e. Defendants’ Conspiracy and Monopoly Are Economically Plausible

Defendants’ expert claims economic implausibility of the patterns and practices described above. See

Defendants’ Memo of Law at :21-:23. Although their theoretical attack on the plaintiffs’ quid pro quo argument

may have superficial appeal, its strength is foiled by the reality of this business. WMA’s former employee Richard Johnson emphasized the quid pro quo between promoters getting very profitable "superstars" and

agreeing to take unprofitable, unknown artists; "...WMA’s interest in giving as much lucrative business a possible to the same promoter ensured that the promoter would also promote less prominent (but potentially more promising) acts.’a6 The term "baby acts" was used by Bruce Kapp, a veteran time concert industry executive and now President of Touring for Clear Channel, who worked for a number of promoters including Pace, Contemporary, Magicworks and at various times owned an independent promotion company. Kapp, in

describing this practice, noted that if "baby acts" lost a lot of money for the promoter, "then the agency would take care of them." Kapp Dep. at 171-173. Further, Kapp noted that as a promoter, he would book "baby acts" that would lose money because of the power of the agencies. When asked during his 30 years as a concert promoter which promoters engaged in this quid pro quo with the agencies, Kapp responded, "all of them." Kapp Dep. at 230. Because booking agencies award concerts of lucrative superstars to promoter defendants without

competition and at artificially high prices, promoter defendants handle the lesser or "baby acts" with guarantees as low as zero or $i.00.~7 Rowe Aft. at :2, E×. A & B. At the same time, promoters develop loyalty with "baby acts" that "grow up" to become superstars, thus providing future profits. On the other side of the equation, superstars do not receive remuneration as high as would be the case without the anticompetitive actions of defendants.

Johnson Aff. at 2. Ex. 22.

13

With full and open competition (and black promoters not being excluded), concerts could be promoted at rates of "5% of revenues or even less.’’~8 The past and existing illegal practices have resulted in concerts being promoted in a range of rates from 10% to 15% of revenues.~9 The higher cost figures for superstars tied with control of the local territory (for a white promoter) creates the benefit to the booking agent for their unknown and less popular artists as described by Johnson and Kapp, above. Without the carrot of the profitable concerts, booking agencies could not force local promoters’ acceptance of the unprofitable business. In fact, as Kapp has noted, agencies could have their role curtailed substantially by allowed direct contact between promoters and artists. Kapp Dep. at 170. Kapp testified directly, "No agent wants a promoter talking directly to their manager." Id. at 161. Costs for concerts would be appropriately reduced, benefiting consumers. This has been bitterly contested by booking agency defendants. Id. Booking agency defendants

argue the conspiracy was implausible because their interests were tied to maximizing the profits of artists they represent. However, after CAA conspired with Magicworks to deny plaintiff Rowe’s higher bid per concert for the Janet Jackson Tour in 1998 and accept the lesser Magicworks’ offer, CAA then allowed Magicworks and SFX to make a side deal which contributed to an estimated loss to the artist of between $672,500 and $1,370,000. An internal CAA memorandum, dated October 12, 1998 from Carol Kinzel to her boss, Tom Ross documented the estimated loss, noting, "Everyone involved with the totir kr~ows that Magicworks made a side deal with SFX for a lump sum of money payable to the tour .... 29. Here, it was so important for " Ex. the defendants (both the agency and promoters involved) to maintain the conspiracy that CAA countenanced lost revenue for their client, the artist. The reality of these facts should outweigh any theoretical appro.ach discussed in the Williams report. B. PLAINTIFFS PRESENT SUFFICIENT EVIDENCE TO SHOW VIOLATION OF 42 USC SECTION 1981. The U.S. Congress established a protected class, specifically including African-Americans, and prohibited

racially motivated interference with the ability of members of the class to make and enforce contracts, among other rights. Congress also barred certain anti-competitive behavior with its adverse effect on trade and

Report of Dr. Gerald Jaynes; Ex. 36 19I._.~d.

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interstate commerce. In this case, the same activities of defendants that run afoul of antitrust laws also transgress civil rights laws because of the protected class status of the victim plaintiffs. The booking agency defendants have conspired with defendant promoters and others to violate the civil rights of plaintiff black promoters. The applicable law (42 U.S.C. Section 1981) requires: (1) the plaintiffs must be members of a racial minority, (2) the defendant had intent to discriminate on the basis of race, and (3) the discrimination involved one or more of the enumerated activities. Mian v. Donaldson, Lufkin & Jenrette Sec. Corp., 7 F.3d 1085, 1087 (2d Cir. 1993) citing to Patterson v. McLean Credit Union, 492 U.S. 164, 177 (1989). In this case, the enumerated activity is the right to make and enforce contracts. Racial discrimination concerning employment contracts is within the purview of Section 1981. Johnson v. Railway Express Co., 421 U.S. 454, 459-60 (1975).

Plaintiffs present unchallenged evidence that each is a member of a racial minority or an entity that i

owned and controlled by such a racial minority. Defendants’ actions, agreements and activities discussed

below prove the intentional acts to discriminate in a statutorily covered activity: plaintiffs’ right to enter in and to enforce contracts to promote concerts. Joe R. Feagin, Ph.D. (Harvard, 1966) was asked to render an

opinion as to whether, vel non, the facts support a finding of discrimination in this case.2° He concluded th accounts and incidents recounted by the black promoters in the record of this case "constitute racial bias and exclusionary discrimination" within the concert promotion business. Feagin Rep. at 3, Ex. 30. Defendant booking agencies fail to address the raw, ugly, unvarnished racial animus uncovered during discovery. The racial epithet "nigger" was used 349 times in e-mails of employees of CAA and WMA. Ex. 31. Carol Kinzel, a CAA agent, wrote a note in her office, "Not Divulge Guarantee re: Black Promoters." Ex.

32. Her tortured explanation strains credulity and demands a weighing of her credibility at trial. Former

defendant Howard Rose of The Rose Agency flatly declared in a note outlining the critical terms of a promoter contract, "No Blacks." Ex. 33. Black promoter and non-party, Bill Washington testified to defendants’ negative view of black promoters and the Black Promoters Association (BPA). In describing his experience
2o Dr. Feagin is currently a graduate research professor in sociology at the University of Florida. He has conducted research and analysis of race relations in the United States for over 35 years. He has published seventeen (17) books and has written dozens of articles related to racial discrimination. Additionally, he has been an advisor on the subject to the U.S. Department of Defense for more than 20 years and is a recent president of the 13,000-member American Sociological Association.

15

with white agents he said, "The white agents in general would laugh at it as if it [BPA] were a joke... Specifically responding about Cara Lewis of WMA, he stated, "Yeah, she laughed. She thought it [BPA] was a joke." Washington Dep. at 104-106, Ex. 34. These sad and regrettable relics of discrimination, coupled with

their predictable effect, have robbed the bidding process of any integrity and brutally hindered plaintiffs from obtaining business in the promotion industry.

Significant evidence exists in the record that booking agency defendants together with local dominant

white promoters discriminated against the Plaintiffs on the basis of their race and that they did so with knowledge and intent. A1 Haymon and Bill Washington, non-party black promoters, are often cited by

defendants to indicate there is no discrimination; their direct testimony, however, shatters the fictional utopi

proffered by defendants. Haymon bluntly concluded: "I know there have been discriminatory business practices that I have faced... [T]he manner in which business has been conducted on a number of occasions, which I have cited under oath, leads me to believe that there is a degree of discrim!natory business practice that surfaces in some of my dealings with William Morris and CAA." Haymon Dep. at 433-434, Ex. 35.

Washington when asked about CAA and his personal knowledge of any racial discrimination against him in his dealings with them, emotionally stated, "... they are racists." Washington Dep. at 127-128, Ex. 34. The blunt force impact of these charges by non-party black promoters neuters any reliance on them by defendants.

Prior to the filing of this action and in the absence of plaintiffs’ self-help or other specia circumstances, booking agency defendants have not allowed concert promoter contracts with any black promoter for any white act or major black acts. Rowe Dep. at 113-114, 213-225. Similarly, defendant promoters have not worked with black promoters on concerts for white acts and some defendants have

successfully resisted using black promoter plaintiffs even when there was a clear opportunity or commitment to do so. Through the combination of 1) day to day practices used by booking agency defendants (false and

mis!eading communication, higher deposit and guarantee amounts, failure to submit plaintiffs’ bids to artists and 2) the local market, regional, territorial and venue control of promoter defendants, black promoters are effectively locked out of the concert promotion business. The law permits several theories of proof that are established by the existing record. ¯ 16

1. Statistical Evidence Can Be Used By The Jury To Establish A Pattern Of Discrimination A jury may infer discrimination from pattern and practice evidence where the disparity has no reasonable business explanation. For example, the Court in Sweat v. Miller Brewing Co., 708 F.2d 655, 658 (11th Cir.1983), held that statistical information concerning an employer’s general policy and practice concerning minority employment may be relevant to a showing of pretext, even in a case alleging an individual instance of discrimination rather than one alleging a ’pattern and practice’ of discrimination. Additionally, more general comparative evidence may permit a Court to draw an inference of pretext. Id; Furnco Construction Corp. v. Waters, 438 U.S. 567, 580 (1978) (District Court entitled to consider the racial mix of the workforce).2’ In particular, statistical data is relevant to establishing a pattern of conduct and may facilitate a determination as to whether the defendant has discriminated against a particular individual as well as an entire class. Lyoch v. Anheuser-Busch Co., 164 F.R.D. 62, 66 (E.D. Mo. 1995) (information regarding the hiring and promoting of similarly situated employees is relevant to plaintiff’s claim). Courts have held that a substantial disparity in the proportion of blacks in a specific job classification is sufficient to establish a prima facie case of employment discrimination. Robinson v. Union Carbide Corp., 538 F.2d. 652 (5th Cir. 1976); Sagers v. Yellow Freight System, Inc., 529 F.2d 721,729-30 (5th Cir. 1976). In ihis case, evidence of booking agency defendants and white promoter defendants failure to enter contacts and to allow business opportunities with black promoters is evidence of their intent to discriminate against the Plaintiffs. Plaintiffs’ testimonial and other evidence of defendants’ racial discrimination was independe.ntly verified and corroborated through Dr. Gerald D. Jaynes, an internationally recognized expert on the economic status of African-Americans.2~ Dr. Jaynes utilized the "statistical test" methodology (wh’ich is widely

21Jam has never permitted a black promoter to work with it on a single white act. When asked which white acts he has

promoted with black promoters before this lawsuit, Arny Granat could not name a single one. Granat Dep. at 55, Ex. 37. Yet Jam has co-promoted concerts featuring white acts with other white promoters. Mickelson Dep. at 111, Ex. 38~ Conspicuously absent, however, from Jam’s co-promotion activity is its failure to have ever co-promoted any white acts with any black promoter prior to the filing of this lawsuit. Also conspicuously absent is Jam’s failure to have ever co-promoted any act, black or white, with any of the Plaintiffs except under threat of public exposure. Beaver has the same sordid record of excluding black promoters Dr. Jaynes is currently a tenured professor at Yale University and a principal in the consulting firm of Bobo, Jaynes & McKinney. In addition to his stellar academic credentials, he has an extensive background of research, published works, 17

recognized by federal Courts 23 as the appropriate test of discrimination in a business context) and other techniques to reach his opinion in this case. In his view, "... the booking agency defendants underutilized black concert promoters relative to their 10% availability, and that it can be concluded, as a result that the booking agency defendants engaged in racial discrimination against the plaintiffs." Jaynes Rep. at 4-5, Ex. 36. Moreover, he verified his statistical conclusions of his report with review of testimonial and anecdotal evidence, which was found to be consistent with the conclusion of the existence of discrimination in this case. Beyond that, Dr. Jaynes reviewed the analysis of defendants’ expert, only to find that using defendants’ data, the conclusion of underutilization is confirmed. Finally, he used recognized methods and calculated damages based on the discrimination that is demonstrated by the record in this case. He estimates the damages for the three agency defendants at approximately $29.1 million. Jaynes Rep. at 7. 2. Bookinl~ A~ency Defendants Select And Or Substantially Control The Process Selecting Promoters Booking agency and promoter defendants erroneously argue that because the selection of concert

o@

promoters is a decision over which they have no control, that they cannot be held liable, even if the process discriminates against the plaintiffs. The defendants rely on the fiction that artist and/or their managers exercise "ultimate" authority to select promoters. Even accepting the "ultimate" met.aphysical authority of artists and/or their managers to select promoters, the reality of the business is different. In fact, only two artists have given testimony in this case: Bill Cosby and Marlon Jackson. During a career that spans over 40 years, Mr. Cosby testified that he worked with approximately 3,000 promoters. He said he had only selected perhaps I0 of those promoters. Further, he estimated that his agency, WMA, selected 90% of the promoters. Cosby ]~ep. at 29-33. Similarly, Mr. Jackson said over his 30 years of concert tours, the agency almost always selected the promoter.. Marlon Jackson Aff. at I, 5, Ex. 2. Both witnesses are unchallenged by any contrary evidence.

lectures and applied science concerning the economics of race relations and economic status of African-Americans. He coauthored one of three major works of the 20t~ century analyzing discrimination and black economic progress in the United States. His work has been subject to peer review through the National Academy of Sciences, where he also served as study director for their Committee on the Status of Black Americans at the National Research Council. He has taught or lectured at Harvard, Yale, University of Pennsylvania, Boston University and other distinguished schools. He has appeared before Congress, a Presidential Commission and his work has been recognized in Israel, Europe and by the British Parliament. Including the Supreme Court in the case, City of Richmond v. J.A. Croson Company, 488 U.S. 469 (1989).

18

Even in the rare case where artists and/or their managers participate or make an "ultimate" decision, booking agency defendants are in a significant position to control, modify and affect the flow of information that is available to make the decision. Bill Cosby stated that he relied on the selection process of his agency with regards to the promoters he worked with. Cosby Dep. at 32. Richard Johnson a former WMA agent testified "if any unsolicited offer or bid came to an agent from a secondary promoter it would likely, never leave his or her desk." Johnson Aft. at 2. Artists invariably defer to booking agency defendants. They are the decision maker in fact and the very nature of their roles is to decide for artists. Interestingly, defendants’ false reliance on contractual pfivity to shield them from liability from their illegal conduct is thwarted by case law. The Courts have held liable those whose conduct interferes with the formation of contracts under Section 1981. Faraca v. Clements, 506 F.2d 956 (5th Cir.), cert. denied 422 U.S. 1006 (1975); Vakharia v. Swedish Covenant Hosp., 765 F.Supp. 461 9 (N.D. I11. 1991).
o

Promoter Defendants Knowingly Participate In And Benefit From The Conspiracy To Exclude Black Promoters And Do Not Compete With One Another While Engaging In Other Anti-Competitive Actions

The white promoter defendants, who have conspired with and benefited from the exclusivity over particular territories, constitute a closed club, sometimes referred to - even by other white promoters - as a "good old boy network." Alexander Cooley, a white promoter for over thirty years who is now affiliated with former defendant SFX, testified that racism and the good old boy network in the concert promotion industry stymied black promoter opportunities: Q. Let’s talk about your phrase that you just stated, the good old boy network. What did you mean by that? A. What I mean by that is what every business I’ve ever known of, just like the banking business there’s -- I felt like I was excluded from the good old boy network in that when I tried to get financing for my shows. And if you’ve worked with somebody for thirty years and you’re a god-son (sic) to his child, you know, friendships develop in any business, and that does have some factor, but it’s way, way down on the list now. It used to be much more, probably, but it’s way down on the list now .... Q. Do you know of any Black promotors s[~_] who are in what you have phrased the good old boy network? A. No, I do not. Q. So, with regard to this good old boy network concept, that develops over a period of years; is that fight? A. Yes. ¯ 19

Q. And so years ago when these relationships were first developing, at least some of them, when the concert industry started in late Sixties, early Seventies, the concert industry I’m talking about now, and there was racism, that precluded Black promotors [sic] who were operating then from becoming a part of the good old boy network; isn’t that right? A. I would think so, yes. Alex Cooley Dep. at 96-100, Ex. 39. The dominant promoters of the white "good old boys network" benefit greatly from the exclusion of black promoters. To provide this extraordinary benefit to a select group of white promoters, the booking agency defendants operated in a way that is contrary to purely economic interests of their superstar clients. Agency defendants ignored the competitive value of superstars in favor of an agreement with dominant promoters to help them "grow" the stars of the future. Bruce Kapp, promoter, described this practice of quid pro quo of promoters servicing less promising acts in exchange for more lucrative business. Kapp Dep. at 71. Richard Johnson, a WMA veteran, also confirmed this anti-competitive practice. Johnson Aft. at 2. It is in remuneration for this agreement that the booking agency defendants provide promoter defendants exclusivity, and it is partially by their participation in that agreement that the promoter defendants join the conspiracy to exclude black promoters. The agents, who guarantee the promoters market exclusivity, profit by requiring promoters to promote acts they otherwise would not take, a practice which provides concert outlets for their lesser known or new talent to become groomed for future stardom. Id.. Attached to the Rowe Decl. as Comp. Exhibits A and B, respectively, are contracts which show that Beaver has promoted concerts with extremely low guarantees to the artists, sometimes as low as $1.00, and Beaver’s contracts for the superstar acts such as Celine Dion, .Eric Clapton, Michael Bolton, Bette Midler, among others, which Beaver was given in exchange for promoting the lesser known or new talent. 4. Territorial Monopolies B,V Dominant White Promoters Each major market in the United States is controlled by a single white promoter. Johnson Aft. at 2, Kapp Dep. at 226-240. White promoters, by mutual agreement, respect one another’s territorial monopolies. It is virtually unheard of for any of the major concert promoters such as Beaver to promote a concert outside the territory they control. Rowe Aft. at 10. In this way, they keep out any undesirable competition in a market 20

that, in most instances, they have controlled for decades. This closed club consists exclusively of white promoters, including defendant Beaver and Jam, and white-owned agencies, and is maintained by the economic interests each of the participants has in its preservation. Id. at 7. Expressing the frustration of being frozen out of Northern California, Brian Rishwain, a Los Angeles promoter who is not a party here, described

the closed operations among dominant promoters when he said, "...They’ve got a monopoly." (Rishwain to Curtis Letter; Ex. 40). Agents were hardly shy in trumpeting the conspiracy when it served their interest. In

expressing his displeasure with Bill Graham Productions for not promoting a WMA client, Shelly Schult wrote on February 25, 1998, "...you need to understand that there are others who are chomping (sic) at the bit to move into your marketplace..." Ex. 41. When that threat failed to move the dominant San Francisco area promoter, Schultz wrote again on March 2, 1998, "If the walls are down around the bay area, it’s because you allow that to happen..." Ex. at 42. Even with a reported $2 billion in assets, SFX could not compete successfully with the dominant promoter monopoly. Booking agency defendants aligned with the dominant promoters and did not do business with SFX. Later, Bob Sillerman of SFX used the strategy of buying dominant promoters for hundreds of millions of dollars to gain access to their markets. Rowe Dep. at 174-185. As SFX acquired local promoters and SFX was later sold to Clear Channel, some at CAA feared the promoter monopoly under SFX’s control would threaten the booking agencies. Kapp Dep. at 185. The fear arose because Clear Channel also controlled

a division that had a booking function. With the booking function and the promoter monopoly, SFX/Clear Channel could function without booking agency defendants. Tom Ross, the former music director at CAA, was extremely concerned about the acquisition strategy of SFX as a monopolistic threat to the booking agency business. Ross Dep. at 46-53; Ross Speech, Ex. 43. If the Clear Channel structure could book artists, promote concerts and control certain venues, booking agency defendants would become obsolete, although consumers would benefit from lower costs. Kapp dep. at 192194. With CAA facing this risk, Richard Lovett of CAA sought Tom Ross’s perspective on dealing with SFX.

Lovett sent an email to Ross explaining CAA had communicated to Sillerman a desire to avoid conflict by saying, "... why don’t we try to work constructively so that no one is suspicious of SFX.s moves." Ex. 44. 21

This email supports plaintiffs’ other evidence of the conspiracy between agencies and the promoter

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"fraternity" to restrict competition.24 An artist could do one-stop shopping and pay a single fee. Kapp. Dep. at 93. After Ross was fired by CAA because of his complaints about SFX, representatives of CAA and SFX met in New York and agreed to co-exist with SFX divesting its booking arm QBQ. Ross Dep. at 46-54. This allowed the conspiracy between agencies and dominant promoters to continue. After all, SFX was made up of many of the same promoters who controlled the local markets. Rowe Dep. at 719, 1340, 1485, 1489. These territorial monopolies were and are also used to maintain harmony among the white promoters and to protect the promoters’ relationships with the agencies. Rowe Dep. at 180-185. For example, if an agency gave to Delsener (SFX), the dominant white promoter in New York, a date in New Orleans, Beaver would object and Beaver’s relationship with Delsener and the agency would be adversely affected. Id.. If this

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were to happen in each of the many different markets across the country, the conspiracy would collapse. For the same reason, if any open and competitive bidding were allowed, it would have the same result. 5. Racially, Disparate Treatment Of Plaintiff

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The terms of the contracts under which Rowe and other black promoters promoted black artists were less favorable than the terms which the dominant white promoters enjoyed. Rowe Aff. at 13. For example, Rowe was always required to submit deposits representing 50% of the guarantee upon signing the contract, even if the contract was being executed as far as 120 days in advance of the concert date, under threat of the date being sold to someone else. Id.. On some occasions, including Janet Jackson’s tour in 1998, Rowe was

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being asked to put up to 100% of the guarantee sixty days in advance of the concert. Rowe Aft. at 13. He has never been permitted to pay as little as 10% or 0%. It was his belief for years that what he paid was the industry standard. This seemed to be confirmed when he co-promoted black concerts with white promoters,

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for on those occasions on which he saw the contract, the deposit requirement was always 50%. Id.. Rowe now knows that the agents and promoters conspired, so that he and other black promoters would not be aware of the 10% and in some cases 0% deposit requirements the white promoters were enjoyed.

@
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Booking agents and promoters would develop paperwork requiring a 50% deposit whenever he or other blacks z4 In another revealing internal email, Rob Light asked if a potential SFX competitor could be helped given their relationship with CAA. Ex. 45. 22

were used to co-promoter with a white promoter. Id.. For example, the contracts show a 50% deposit for Beaver on Kenny G for dates which were co-promoted with Larry Bailey, a black promoter. For those dates, the actual deposit paid by Beaver was only 10%. The contracts with Beaver as the sole promoter for Kenny G, reveal a 10% deposit. Rowe Declaration as Comp. Exhibits C and D. This fraud was only uncovered through the discovery in this case. Rowe has personally reviewed thousands of "confidential" contracts between Beaver and the agency defendants which revealed that deposit requirements for Beaver and Jam were almost always 10% or 0%. Id. at 15. Attached to the Rowe Declaration as Comp. Exhibits E and F, respectively, are contracts requiring Beaver and Jam to pay a 10% or 0%. Rowe has also personally reviewed thousands of "confidential" contracts between the other former and current promoter defendants which revealed that deposit requirements for those other white promoters were routinely 10% or 0% as well. Id.. These two different deposit standards, one for white promoters and one for black promoters were well known to defendants who could have changed these practices that excluded black promoters from fair competition. Id. Rowe has never been permitted to make deposits after the date tickets were to go on sale. Defendant Beaver, however, routinely paid its deposits long after they were due, and in some instances just mere days before the event. This gave Beaver, and the other dominant white promoters all of whom enjoy the same privileges, the advantage of obtaining ticket proceeds before having to pay the 10% deposit and being able to

use that money in the interim. Documents demonstrate the exemption of Beaver from making deposits as required by its contract with the artist. Attached to the Rowe Declaration as Comp. Ex. G. On the other ha.nd, Rowe, as well as other plaintiffs, has always been required to pay by cashier’s check or bank wire and he has never been permitted to pay a deposit by company check. Id. at 14. Another practice used to give an advantage to dominant white promoters over blacks is sending an advance notification letter. The major agencies, such as CAA, WMA and Renaissance, sent letters to defendant promoters describing specific conditions to be addressed and satisfied. Id. at 15, Ex. H. Such letters were never sent to the plaintiffs. Moreover, white promoters were given notice as to the timing of tours for white and prominent black artists; these notices were never given to black promoters. Id. at 17. When black 23

promoters, including the plaintiffs, called to inquire as to which artists were touring, agencies told them onl about which less successful black artists were touring and never advised of any white artists or superstar black artists who were touring. Id., Johnson Aft.. By the time black promoters found out about the fact that a white artist or superstar black artist was touring, the dates had already been sold to white promoters.25 Id. at 18. As an example, Rowe was not informed of the Luther Vandross 1997 concert in New Orleans before the date was sold to Beaver. Luther Vandross is a black artist who Rowe promoted in 1986, 1987, and 1988. Id. at 22. After Rowe found out about the concert, he contacted Luther Vandross’s agent, Dennis Arfa, at QBQ to complain that he had not been given notice. Dennis Arfa agreed and told Rowe that as a result, he wanted him to choose which markets he wanted to be involved in. Id. at 23. One of the markets Rowe chose was New Orleans. When he called Fox regarding co-promoting the New Orleans concert with Beaver, Fox refused to take his call because he knew that Rowe was calling to discuss co-promoting Luther Vandross with Beaver. Id. at 24. Rowe contacted Dennis Arfa to advise him of his failure to reach Fox. Arfa told him that Fox had refused to agree to allow any black promoter to co-promote Luther Vandross with him. Arfa did not require Fox to co-promote that concert with Rowe, and as a result, none of the plaintiffs had any involvement in that date. Id. at 25. On another occasion, although Rob Light agreed under pressure to include black promoters in a Kenny G/Toni Braxton tour, Light told Rowe that he wanted him to agree not to co-promote Kenny G in New Orleans, because Don Fox would not allow it. Id. at 20. He told Rowe that if he would agree to exclude New Orleans, he would give him another market for Toni Braxton in addition to the others. Id. at 21. A letter dated January 6, 1997, from Light to Rowe and Jesse Boseman confirms that New Orleans was not one of the nine markets in which plaintiffs were eventually allowed participation. Attached as Ex. I to the Rowe Declaration.

Defendants knew of plaintiffs’ discrimination claims prior to the filing of this lawsuit. An artic

concerning plaintiffs’ discrimination claims appeared in a widely read industry publication on June 21, 1997 Billboard entitled, "Black Promoters Say They’re Excluded From Top R&B Gigs," Id., Ex. K. In that article, the racial animus against black promoters was discussed regarding both white and black artists. Robert Light
zs Rowe sent a letter to Rob Light of CAA asking for notice of the Tina Turner concert tour in 1998. CAA did not respond. The Turner dates were quickly sold to the dominant white promoters. No black promoter participated in the Tina Turner tour.

24

of CAA confirmed in his deposition that Rowe raised discrimination claims with him in 1996 and continued t do so into 1998. Light Dep. at 43-56., Id. at 28. Moreover, Rowe as President of the Black Promoters Association extensively documented his claims

of discrimination with letters, press releases and calls to the principals of the booking agency defendants. Ex.

46. While articulating his concerns regarding racial animus, Rowe also specifically delineated various artis

that plaintiffs sought to promote. (Janet Jackson, Kenny G, Toni Braxton, Lauryn Hill). In a poignant plea fo fair~aess to Richard Rosenberg of WMA, Rowe wrote: You once admitted to me in a conversation via telephone that there was something wrong with white (pop) promoters being solicited for both white and black entertainers, while black promoters only have the opportunity to work black entertainers...Yet, you still refuse to meet with us to discuss these problems. Discrimination in any form is like a cancer. Ex. 47. Rosenberg acknowledged receiving the letter. Rosenberg Dep. at 129, Ex. 48. As such, given the extensive record of notification, defendants cannot seriously contest the issue of knowledge of the plaintiffs’ claims. C. DEFENDANTS VIOLATED 42 U.S.C. 1985(3) The basic requirements of Section 1985(3) are clear in that plaintiffs must show: (1) a conspiracy

between defendants; (2) the intent to deprive plaintiff of the equal protection of the laws or the equal privileges

and immunities under the laws; (3) an act in furtherance of the conspiracy and (4) a deprivation of plaintiff’s rights. Byars v. Jamestown Teachers Association, 195 F.Supp.2d 401, 417 (W.D.N.Y. 2002). The

"conspiracy must be motivated by some class-based invidious discriminatory animus behind the conspirator’s

action." Id.; Taylor v. Gilmartin, 686 F.2d 1346, 1358 (10th Cir. 1982), cert. denied, 459 U.S. 1147, (19~ Frooks v. Town of Cortlandt, 997 F. Supp. 438 (S.D.N.Y. 1998). Booking agency defendants and promoter defendants acted in concert to purposefully exclude and eliminate black promoters, including the plaintiffs, from competing in the concert industry. Plaintiffs point numerous acts in the record that are in furtherance of the conspiracy. However, the Court in Thomas v. Roach, 165 F.3d 137, 146 (2d. Cir. 1999), explained that a conspiracy need not be shown by proof of an explicit agreement. The Court went on to say "...rather such a conspiracy can be established by showing that the parties have a tacit understanding to carry out the prohibited conduct." The agreement among the defendants 25

is evident from the practices used by booking agency defendants and the exercise of promoter defendants’ dominance in local markets to the detriment of plaintiffs and all black promoters. The agreement among the defendants to carry out the conspiracy is also established by the disparate guarantee, deposit and other requirements applied to black promoters as opposed to white promoters. As has already been shown, white promoters enjoy a 0% or 10% deposit requirement where plaintiffs were strictly required to make deposits of at least 50% of the artist guarantee. Even more telling is an example of the deposit requirements changing for the same artist on the same tour, when a date was promoted by a black promoter. When black promoter AI Haymon contracted with WMA for several 1999, Lauryn Hill concert dates, a 50% deposit was required. Haymon Contracts, Ex. 49. Specifically, the contracts provided: A guarantee of $74,000 and a 50% deposit of $37,000 upon signing the contract for shows on March 31, 1999 and April 1, 1999. A guarantee of $164,000 and a 50% deposit of $82,000 upon signing the contract for shows on March 13, 1999 and March 14, 1999. A guarantee of $52,000 and a 50% deposit of $26,000 upon signing the contract for a show on March 21, 1999.

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Id.. However, when defendant promoter, Jam, contracted with WMA for two Lauryn Hill concerts the same year, its requirement was only a 10% deposit. Under the te~xns of the contract between WMA and Jam for Lauryn Hill concerts on February 20 and 21, 1999: Ex. 50. ¯ ¯ a guarantee of $64,000 and a 10% deposit of $6,400 upon signing the contract for a show on February 20, 1999 a guarantee of $64,000 and a 10% deposit of $6,400 upon signing the contract for a show on February 21, 1999.

In this one instance alone, comparing the terms for the black promoter to those for the white one, it is clear that WMA set higher guarantees and deposit requirements for the black promoter.26 The purpose of the tacit agreement among promoter and booking agency defendants was to deny

and limit contracts and other business opportunity for all black promoters. Given the evidence in this record, a conspiracy among white promoters and booking agency defendants presents genuine issues of
" Although Haymon is not now a plaintiff in this case, he signed on to bring this action prior to its being filed. At that time, the dominant promoters, including SXF, and the booking agencies were among the intended defendants. Id. at 27, Ex. 6J When Haymon was negotiating the sale of a major part of his company to SFX, he withdrew. Although seemingly revered by booking agency defendants, given his copious citations in their brief, Haymon was treated black when the issue was money.

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material fact exist and requires a trial. Accordingly, defendants’ motions for summary judgment should b denied. Camelio v. Walmart Stores, Inc., 15 F. Supp. 2d 268, 269 (W.D.N.Y. 1998) (summary judgment

may only be granted if "the pleadings, depositions, answers to interrogatories, and admissions on file together with the affidavits, if any, show that there is n__9_o genuine issue as to ~ material fact.).

Since there are genuine issues of material fact regarding the existence of this conspiracy and the

existence of the class-based, invidious discriminatory animus, the question of whether defendants were in fact

motivated by this animus becomes a question for the jury. Taylor v. Gilmartin, et al., 686 F.2d at 1346 (198 ("[w]hether the defendants were in fact motivated by the alleged animus against religious minorities is,

course, a question for the jury"). In Perry v. Manocherian, 675 F. Supp. 1417 (S.D.N.Y. 1987), the Court held

that the plaintiffs raised sufficient issues of fact to satisfy the elements of a Section 1985(3) action, thereby

defeating a motion for summary judgment. In reaching its decision, the Court determined that there was

evidence on the record from which a jury could infer that the defendants’ actions were motivated by racial

animus. Id.. As in Perr,d, the Plaintiffs in this case have alleged sufficient facts to give rise to an inference th each of the four elements of a Section 1985(3) claim has been met. Therefore, this Court should deny the Defendant’s motion for summary judgment on Plaintiffs’ Section 1985(3) claims. ARGUMENT

The law which governs the decision on the defendants’ motion for summary judgment is long standin and well settled from both a procedural and substantive point of view.27 The procedural aspect of this case is controlled by Court interpretations of the rule for summary judgment. The substantive law aspects are governed by an antitrust statute28 and the post-reconstruction enactment of civil rights statues.29 The decision will therefore necessarily affect important rights of the plaintiffs.

27 Supreme Court precedent has remained consistent for over thirty years. American Manufacturers Mutual Ins. Co. v. American Broadcasting-Paramount Theatres, Inc., 388 F.2d 272, (2d Cir. 1967); Cali v. Eastern Airlines, Inc. 442 F.2d 65, 71 (2d Cir. 1971). ~ 15 U.S.Code Section 1. 29 42 U.S.Code Section 1981 Et. seq.

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t

Failure To Meet Defendants’ Burden Of Proof Because the moving party has the burden of proof, the Court can begin and end its inquiry by an

analysis of the moving parties’ showing. The moving party must first show that there is an absence of an material fact issue genuinely in dispute. Adickes v. Kress & Co.~ 398 U.S. 144, 157, ~26 L. Ed. 2d 14:2, 90 S.Ct.

1598 (1970). Even without consideration of plaintiff’s response, the defendants’ motion must fail if this test i

not met. Plaintiffs argue that defendants internal to their own filing have not met the burden. For example, th defendants have disputed themselves on several key issues.

In their memorandum of law, defendants argue that the plaintiffs are not "concert promoters’’3° and do not have attributes of concert promoters saying, "Plaintiffs do not contract with talent, do no____At pay for talent, venues or other production and promotional expenses associated with putting on a concert, and do not assume

financial risk in the success or failure of concert engagements--the quintessential attributes of a concert promoter.’’3t In the same document, defendants argue that the plaintiffs promoted white acts.32 If plaintiffs did not possess "quintessential" attributes to promote, how could black promoters promote such white acts as are

in the defendants’ long list)3 That list of 25 white acts, the ones defendants allege were promoted by b promoters and represented by current or previous booking agency defendants, failed to generate even a single contract from the documents defendants’ produced in discovery where the parties to any promotion contract was signed on one hand by one of the white groups and on the other by a promoter of African American descent. The defendants cannot have it both ways; either the plaintiffs are promoters or they are not. Also, if plaintiffs and other black promoters promoted white acts represented by defendants, why have defendants failed to produce any contracts as evidence of their claim? The evidence is unequivocal and directly
30 Booking Agency Joint Memorandum of Law, Page 6

3~ Id.
3~ Id. at 8. 33 Defendants list the following as white acts among those plaintiffs promoted Bob Dylan, Barry Manilow, the Black Crowes, Sheryl Crowe, Kenny G, the Average White Band, Steppenwolf, Three Dog Night, Johnny Winter, Robin Trower, Edgar Winter, Harry Connick, Jr. Styx, Rush, Kiss, the Young Rascals, Jean Luc Ponte, Charles Asnaguor, Steely Dan, Vanilla Ice, Christina Aguilera, Jessica Simpson, Dream, Cleo Laine and John Dankworth.

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contradicts defendants claim; neither the plaintiffs nor any other African-American has ever promoted a white

act as that term is understood in the industry. Participation in activities related to a concert is not enough to be

considered promoting an artist. A promo.ter of an act has a contract with the booking agency. Plaintiffs argue that the defendants have not presented such contracts because they do not exist. The Court need not view the absence of such contracts as the only proof. Pollstar data for the yearly top 200 concert tours for 1993 through 2001 does not list even a single black promoter of a white act. In fact, the Pollstar listing of 1800 concerts tours covering 9 years, only one black promoter was listed at all, at number 198 in 1998. Additionally, not a

single witness testifying in this case pointed to any instance of a white act being promoted by a black promoter and pr.esented a contract to back up that claim. Burden On The Plaintiffs The burden on the non-moving party is not a heavy one; that party must simply show "specific facts, as

opposed to general allegations, that present a genuine issue worthy of trial." Wright & Miller, Federa Practice and Procedure (1998), § 2727. When a Court considers a motion for summary judgment, "... it must

resolve all ambiguities and draw all reasonable inferences in favor of the party against whom summary

judgment is sought." United States v. Diebold, Inc., 369 U.S. 654 (1962). Plaintiffs have presented facts from which a jury may draw material inferences based on the substantive law. InclUded among such facts are: Defendants engaging in anti-competitive conspiracy to plaintiffs’ detriment,34 Defendants demonstrating a motivation of racial animus35 and Defendants discriminating against plaintiffs on the basis of race.36 In each of the examples above and others cited in plaintiffs’ statement of disputed facts, a Court "...cannot try issues of fact; it can only determine whether there are issues to be tried." Heyman v. Commerce and Industry
34 Booking agencies and promoter defendants through concerted action denied Fred Jones and his company the contract to [asromote at Mud Island without a white partner. WMA told black promoters that Erykah Badu was not performing but at nearly the same time awarded concert dates to white ~6romoters; CAA and WMA required different and substantially less favorable terms for contracting with black as opposed to white promoters with respect to concerts for Janet Jackson, Luther Vandross, Maxwell and other artists. Discrimination was also statistically established as studies showed black promoters were underutilized as compared to their market availability. Plai~:tiffs have also submitted separate statements of contested (disputed) material facts and memoranda of law opposing the motions for summary judgment of the other defendants and individual booking agency defendants. Said statements of contested (disputed) material facts and memoranda of law are incorporated here by reference and adopted as a part of plaintiffs’ opposition to booking agency defendants’ motion for summary judgment.

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Insurance Company, 524 F.2d 1317 (1975). The substantive law allows inferences to establish essential

elements of the cause of action. In this case, the Court in considering this motion for summary judgment

"...must construe all facts and draw all reasonable inferences in favor of the non-moving party." HCA Health Services of Ga., Inc. v. Employers Health Ins. Co., 240 F.3d 982, 991 (1 lth Cir. 2001). Such an exercise will yield but one conclusion for this Court: a trial is necessary to decide the issues raised by plaintiffs.

Summary judgment is a procedural mechanism to assure efficient judicial administration but it is also

"...a drastic devise since its prophylactic function, when exercised, cuts off a party’s right to present his case to a jury." Donnelly v. Guion, 467 F.2d 290, 291 (2d Cir. 1972). The plaintiff parties, here, brought the action to seek the right to engage in interstate trade without restraint and to both enter and enforce contracts. As

Donnelly would seem to require, the Court should not allow the drastic procedure of summary judgment to extinguish plaintiffs’ substantive rights to trial.

Defendants argue that "relationships are crucial" to developing a successful concert promotion

business and that the lack of developing such relationships lies with the plaintiffs. Here, the defendants engage

in a ~’blame the victim" strategy that should not allow them to escape liability. Black promoter Bil Washington succinctly stated, "... black promoters don’t develop relationships with people at CAA." Washington Dep. at 127. Several witnesses and other evidence point to the cause of plaintiffs limited and

restricted opportunities as the defendants’ actions: "racism as a factor,’’37 the promoter "fraternity,’’38 and "regional, territorial, and venue domination of the local promoter network.’’39

Defendants also argue that plaintiffs cannot obtain relief because of not submitting bids and not identifying specific contracts that were denied. Each claim is patently false and contradicted by the record. First, submission of bids is a false issue because there is no open, fair and objective bid process for anyone.4°

WhJ.te promoters obtain contracts without submitting bid.4~ Former WMA agent, Richard Johnson testified th

unsolicited bids would not "leave the desk" of the agent receiving them. Johnson Aff. at 3. Second, Plaintiffs

37 Alexander Cooley Dep. at 96, 98; Ex. 39. 38Wavra Dep. at 39-40, Ex. 52 39Light Dep. at 51; Johnson Aff. at 2; Kapp Dep. at 236-238. ~ Johnson Aft. 4~ Contracts, Composite Ex. 54, 55, 56

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did submit bids. One only need review two examples to establish the futility of their doing so: a) when

plaintiff Rowe submitted a bid offer forthe 1998 Janet Jackson Tour, defendant here, CAA engaged him in a pretext while moving to grant the entire tour to Magicworks42 and b) when plaintiff Rowe submitted a bid the Maxwell Tour where defendant, WMA did not list the bid as received, did not respond to Rowe, nor share

the bid with the artist and selected white dominant local promoters.43 In arguing that there is an open bid process, defendants quote black promoter Haymon as saying no barrier exists to submitting a bid as long as one has a fax machine. The record, however, demonstrates that faxing a bid did not open the door to opportunity nor bar the venal hand of discrimination. Among numerous other denials, there are specific contracts in the record that were denied to plaintiffs seeking business. Perhaps the most significant contract denied was the two year exclusive promotion contract for the Memphis Mud Island venue.44 That contract was sought by plaintiff, Fred Jones and was almost

approved but for the defendants’ conspiratorial intervention just prior to it being finalized. Also, Jones los another specific promotion contract with the artist James Taylor that month because defendant, WMA, changed the venue.45 Additionally, demands were made of the defendants with plaintiffs seeking to obtain

contracts to promote: Erykah Badu46, Maxwell,47 Janet Jackson,48 Luther Vandross49 and Toni Braxton/Ke G.5° In each case above, not a single contract was executed with the plaintiffs. ’In three of these five specific contracts, plaintiffs obtained limited participation after threats to picket, approaches to the media or other self

help. In one case, Erykah Badu, a mere phone call from a "fraternity" member denied a plaintiff any opportunity and, in the final one, defendant WMA engaged a firm owned by one of its black clients, M.agic

,~2 Rowe to Rob Light "firm offer" letter dated February 10, 1998, Ex. 14. ,~3 Rowe to WMA letter Ex. 23; WMA list of bids received, Ex.24 ; WMA list of actual promoters, Ex. 25. 44 Although defendants and Mayor Herenton claim the mayor’s denial of the contract was based on "policy" reasons, the circumstances surrounding the cancellation (discussed in detail above on pages 7-10) highlight disputed facts ripe for jury review. In summary, the mayor: approved essentially the same arrangement on two prior occasions, told Jones he had "no problem" with it, allowed the MPC to vote approval and then reversed his position (and denied the contract) only a day after a threatening letter from the defendants was received in Memphis. The conflicting witnesses to these facts and their respective credibility require a trial. 45 Letter from Shelley Schultz to Susan Green dated April 17, 1998, Ex. 11. ~6 Boseman Dep. at 405, Ex. 26. 47 Rowe Dep. at 879, Ex. 10. 48 Id. at 206, Ex 10. 49 Id. at 864 50 Id. at 283-284, Ex.10.

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Johnson Enterprises, to co-promote Maxwell after the filing of this action. This last ploy gave the perception of inclusion but was merely a tactic to deny plaintiffs a contract.

Whether the booking agencies controlled the selection of promoters sufficiently to interfere with

plaintiffs’ fight to make and enforce contracts is a question of fact. Defendants (both agencies and promoters) seek to persuade the Court to make a legal finding that as a matter of law they were not parties to the contract and therefore cannot deny the contract. This case presents not a legal but a fact question as to whether

defendants’ concerted actions, not their legal status, interfered with the plaintiffs’ rights under the law. and must be decided at trial. Plaintiffs’ Antitrust Cause Of Action Courts have ruled that summary judgment for an antitrust claim should be difficult to obtain because of the inherent factual complexity of such cases. Hayden Publishing Co. v. Cox Broadcasting Corp., 730 F. 2d 64, 68 (2d Cir. 1984); Bhan v. NME Hospitals, Inc., 929 F. 2d 1404, 1409 (9th Cir.), cert. denied, 112 S. Ct. 617 (1991). In the record here, plaintiffs prove numerous specific facts that are disputed by defendants and are critical to a decision on their antitrust claims.

The plaintiffs claim that their exclusion from the concert promotion business flows directly from th

combined action of booking agency and promoter defendants. Without multiple defendants acting under a

specific or tacit agreement, the conspiracy would fail. Plaintiffs have made various demands, submitted bids and otherwise sought promotion contracts for major black and white artists. Defendants have acted with one

another to effectively exclude plaintiffs from getting promotion contracts. Contemporary music artists are

overwhelmingly represented by defendant booking agencies, making such agents dominant in the market o

artists performing or available to perform concerts.5~ Ex. 53. Booking agency actions and th’eir agreemen

with and actions of promoter defendants are the direct cause of plaintiffs’ exclusion from obtaining concert promoter contracts.

Moreover, the plaintiffs argue that the defendants’ conduct is plainly harmful to competition and lacks

any redeeming pro-competitive values and that they should be "conclusively presumed to be illegal without

5~ Of the top 100 concerts performed by such artists in 2001 as reported by Pollstar, these three agencies represented 51 artists.

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further examination." Broadcast Music, Inc. v. CBS, 441 U.S. 36, 49-50 (1977). The law has recognized such

"per se" antitrust violation where defendants, as they have in this case, "divided the market into territories’’5

and as a group "refuses to deal with a competitor.’’53 Without question, promoter defendants have divided t

market into territories they control54 and with the aid of booking agencies refuse to deal with their competitors

like the plaintiffs. Booking agencies gain an advantage over their competitors in attracting talent because o the territorially dominant promoters, who provide the outlet for new and less prominent acts.

In the absence of a ruling that finds a "per se" violation, the plaintiffs argue, alternatively, for th Court to use the rule of reason analysis on the defendants’ conduct. Under the rule of reason, the defendants’

concerted action (described herein) had an actual adverse effect on competition as a whole in the relevant market.55 Estimates show that promotion costs could be 5% and perhaps less of concert revenue, if competition existed. Jaynes Report at 6 The excess promoter cost is an actual adverse effect on competition

as a whole in the concert promotion market. With this proof, traditional antitrust approaches shift the burden to

defendants to show the pro-competitive "redeeming virtues" of their conduct. Defendants in this case have not

produced a shred of evidence to show why their concerted action should remain undisturbed. The weighing of the harms and benefits of defendants’ concerted action is appropriate for a fact finder.56 The booking agency and promoter defendants were each independerit ec’onomic units that are capable

of conspiring and the evidence in the record shows they actually conspired to exclude plaintiffs and others who might compete with them. Without the closed system of selecting promoters and the quid pro quo of

promoters helping "baby acts," the goal of excluding plaintiffs and other competition would be difficult if no

impossible to achieve. The result is not merely the product of individual business decisions which constitut

parallel conduct. For example, in the absence of powerful entities acting together, it is inconceivable that this

conspiracy could prevent Fred Jones from finalizing the exclusive contract to promote at Mud Island in

5z United States v. Topco Associates, 405 U.S. 596, 609 (1972). 53 Klor’s, Inc. v. Broadway-Hale Stores, Inc., 359 U.S. 207, 211-12 (1959). ~ Dominant Promoter Table, June 1998-May 1999 (Ex. 51). This table shows former and current promoter defendants in this case, each promoted a low of 62% up to a high of 100% of the major concerts in their respective territories. 55 th Austin v. McNamara, 979 F. 2d 728, 739 (9 Cir. 1992). 5Sl’he classic articulation of this process is found in Chicago Board of Trade v. United States, 246 U.S. 231, 23’8 (1918).

33

Memphis. At the same time, defendants have failed to show any benefit to competition in the market about which the plaintiffs complain.

Viewing the evidence in the light most favorable to the non-moving party, facts sufficient to create the inference of the antitrust conspiracy are established by the record. While plaintiffs have demonstrated actual detrimental effects of defendants’ conduct, the Court is also empowered to assess the defendants’ "market

power" as a surrogate for detrimental effects. Plaintiffs’ lack of success in the concert promotion marke

together with defendants’ dominance of the market establish the restraint on competition here. Defendants claim their market power is insufficient to do harm; we disagree. Capital Imaging Associates, P.C.v. Mohawk Valley Medical Associates, Inc., 996 F. 2d 537 (2d Cir. 1993), where the Court found this analysis necessary

even though defendants held only 1.15% of the relevant market. The result in that case is different only

because there, unlike the instant case, neither detrimental effects on cohapetition nor sufficient market power

was found to exist. Here, the defendants have strangled competition with their domination of the industry and short-changed consumers and clients with their illegal and immoral conduct. CONCLUSION For all of the arguments stated herein, as well as those contained in the memoranda in response to each

of defendant’s motion for summary judgment, we respectfully urge the Courtto deny said motions and set this matter for trial. DATED: April ~~, 2003.

AMP LL ( 5
GARY, WILLIAMS, PARENTI, qNNEY, LEWIS, McMANUS, WATSON ~ SPERANDO 221 E. Osceola Street Stuart, FL 34994 Phone: (772) 283-8260 Fax: (772) 221-2177

@

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CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the Plaintiffs’ Memorandum of Law in Opposition to Booking Agency Defendants’ Joint Motion for Summary Judgment was faxed, and a copy thereof with supporting exhibits shipped via~ral Express to counsel of record listed on the attached Service List, on this the~ day of April, 2003, in accordance with the Confidentiality Order entered in this case, three days prior to filing of with the Court.

~[,LI~I~I d.d2Al~ ~ 3ARY, WILLIAMS, PARENTI,~ qNEY, LEWIS, McMANUS, WATSON SPERANDO 221 E. Osceola Street Stuart, FL 34994 Phone: (772) 283-8260 Fax: (772) 221-2177

SERVICE LIST

Helen Gavaris, Esq. Michael P. Zweig, Esq. Charles M. Miller, Esq. Loeb & Loeb, LLP 345 Park Avenue New York, NY 10154 Attorneys for Defendant The William Morris Agency, h~c. Beverly R. Frank, Esq. Jeffrey S. Klein, Esq. Jeffrey L. Kessler, Esq. Pierre G. Armand, Esq. Weil, Gotschal & Manges, LLP 767 Fifth Avenue New York, NY I0153 Attorneys for Defendant Creative Artists Agency, Inc. Monica Petraglia McCabe, Esq. Piper Rudnick 1251 Avenue of the Americas New York, NY 10020-1104 Attorneys for Defendants Jam Productions Steve M. Hayes, Esq. Greg Clarick, Esq. Orin Snyder, Esq. Parcher, Hayes & Snyder, P.C. 500 Fifth Avenue, 38th Floor New York, NY 10110 Attorneys for Defendant RenaissanceEntertabvnent, Inc. James D. Roberts, Esq. Peter M. Ellis, Esq. George L. Grumley, Esq. Piper Rudnick 203 North LaSalle Street, Suite 1800 Chicago, IL 60601 Attorneys for Defendants Jam Productions James A. Cobb, Jr., Esq. Emmett, Cobb, Waits & Kessenich 1515 Poydras Street, Suite 1950 New Orleans, LA 70112 Attorneys for Defendant BeaverProductions, b~c. Rickey Ivie, Esq. Kendall E. James, Esq. Ivie, McNeill & Wyatt 201 North Figueroa Street, Suite 1150 Los Angeles, CA 90012-2640 Attorneys for Plaintiffs

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