Welcome back to a jam-packed issue of What I’m Hearing+, Tuesday’s extra scoop of creamy entertainment industry intelligence. Today we’ve got a tag-team: Eriq Gardner has a few newsy updates, including a pretty shocking new front in CAA’s war against its hated defectors at Range Media. Then our box office expert Scott Mendelson is here with his 7 important takeaways from the surprisingly not-terrible summer at the movies.

Okay, let’s start with Eriq…

In arbitration proceedings, CAA is lobbing serious allegations at its former employees, accusing them of contract breaches, loyalty breaches, and tortious interference by coaxing clients and at-will employees to jump ship. CAA, represented by Paul Hastings, charges that these agents pilfered confidential data and laid the groundwork for their new venture, then under the working banner of “Moxie Media,” while still employed at CAA.

Perhaps more consequently, CAA is framing Range not merely as a management firm but as a rival agency, a critical distinction in California, where agents must be licensed. Range apparently is not. Most amazing for the typically super-secret talent business, to bolster its case, CAA is demanding communications related to the work and fees of its erstwhile clients—including Benicio Del Toro, Casey Affleck, Johnny Depp, Keira Knightley, Michael Fassbender, and Taron Egerton, among others—hoping to uncover more about the support provided to them by Range, and remarkably, how much money was made from those jobs booked. (Notably, CAA continues to represent some of them too, at least ostensibly, including Kendrick and Michael Shannon.) Furthermore, CAA is also seeking other categories of documents, including what was prepared for Cohen before his Point72 Ventures made a splashy investment to bankroll the new firm. (Freedman said he couldn’t comment.)

CAA’s efforts to obtain these documents have met obstacles, so the agency has now taken its fight to Los Angeles Superior Court to enforce arbitration subpoenas. According to court filings I obtained, some Range principals have already faced sanctions and fines for their non-cooperation in discovery, although the arbitrator, Rosalyn Chapman, stopped short of ending the defectors’ equity stake claims as a consequence for not handing over documents.

It’s a rather extraordinary move for a talent agency to demand private information about ex-clients, and not all of these stars are going to take kindly to their former handlers probing whether their reps are illegally procuring them gigs. Such issues might eventually end up before California’s Labor Commissioner, who wields the big hammer of nullifying commissions for unlicensed agency work. Meanwhile, this feud is only set to amplify. The ex-CAA agents undoubtedly have their own discovery demands and now can turn to a public stage to air grievances. This is shaping up to be a full-blown spectacle.

• Spotify misses its chance to blow: There are few songs with more staying power than Eminem’s “Lose Yourself,” which has amassed a staggering 2.26 billion plays on Spotify, among the most streamed tracks ever on the platform—despite the astonishing fact that for years Spotify didn’t have the license to the song. This lapse led to a copyright showdown and a five-year court battle with the rapper’s publisher, Eight Mile Style. On Friday, U.S. District Court Judge Aleta Trauger returned a decision that should definitely be getting more attention.

  Acknowledging that Spotify’s handling of copyrights was “seriously flawed,” Judge Trauger gave the streamer the victory because Eight Mile had slept on its rights for nearly a decade before suing. Joel Martin, one of Eight Mile’s principals, testified that he had assumed Spotify had secured a license from Universal—a claim Judge Trauger dismissed as implausible. “The idea that a multimillion-dollar operation like Eight Mile Style would, for years, simply not bother to do the rudimentary legwork to find out whether its core assets were being wrongfully exploited on the scale at issue here is close to unthinkable,” she wrote—especially since Eminem’s corporate crew hasn’t shied away from litigation before. With a lot of money at stake, this decision is poised for appeal, but for now it stands as an example of what can happen when a copyright owner misses the moment and lets opportunity slip.

• Ye don’t say: It’s astounding, in retrospect, that Adidas maintained a decade-long alliance with Kanye West, despite his not-so-subtle warnings such as drawing a swastika on shoes at Adidas’ German headquarters, not to mention the pro-Hitler remarks. Of course, the collaboration fell apart in October 2022, with Ye accusing Adidas of stealing his designs and the shoe giant countering that he breached a morals clause. The debacle raised a secondary, interesting question: Should Adidas have been more transparent with investors about the risk of partnering with such a polarizing figure?

  On August 16, U.S. District Court Judge Karin Immergut dismissed a lawsuit asking that very question. The plaintiffs had pointed to Adidas’ “zero-tolerance approach” toward harassment and discrimination as a basis for their claim. The Oregon judge ruled that aspirational D.E.I. goals can’t be relied on by investors to predict how the company would handle a misbehaving partner. Finding no evidence of any misrepresentations, Immergut dismissed the suit. Read the full opinion.

• A ‘Walking Dead’ plot twist: Back in 2021, AMC came to a $200 million settlement with original The Walking Dead executive producer Frank Darabont in a closely followed Hollywood accounting case. Now, creator Robert Kirkman and other former producers who feel short-changed would like to know more about Darabont’s big score. AMC, represented by Gibson Dunn, has warned a California judge that piercing the sanctum of mediation might undermine future settlements.

  What makes the case even more intriguing is that Darabont’s mediation took place during the Covid pandemic, with the parties Zooming in from different states with different mediation privileges. So while Darabont filed his suit in New York, and AMC executives were in New York during the Zoom calls, negotiations were led by a California-based mediator, Antonio Piazza. So, does California’s mediation privilege apply? Or is discovery of those dealmaking sessions governed by much vaguer New York law? And by the way, Piazza wasn’t in California for the talks, he was holed up at his part-time home in Hawaii. A hearing is set for next month.

• Swift v. Trump?: Donald Trump’s latest legal controversy reminded me of the time a Chicago-area grocery store got hit with an $8.9 million verdict for violating Michael Jordan’s right of publicity after congratulating him in the pages of Sports Illustrated on his induction into the Basketball Hall of Fame. By the same token, I think Taylor Swift has a pretty good potential case against Trump after the Republican nominee used an A.I. version of Swift to imply an endorsement along with the response: “I accept!” I know some people are watching to see if Swift shows up at the D.N.C. this week, but I’m keeping my eyes on the court docket to see if she takes legal action. I’ve heard it’s under consideration. Stay tuned.
• Is Sunday Ticket still in legal jeopardy?: An appeal was practically guaranteed after federal judge Philip Gutierrez reversed a jury’s $4.7 billion verdict against the NFL and its Sunday Ticket package for alleged antitrust violations. Well, on Monday night, the plaintiffs made their first big move, pointing out that while the head-turning ruling a few weeks ago addressed monetary relief for NFL teams conspiring with each other on TV licensing, it said nothing about injunctive relief for ongoing wrongs. The plaintiffs want an opportunity to make the argument that the NFL’s current deal with YouTube TV for out-of-market games should be halted. Whether or not this amounts to a tactical play to salvage a settlement, it should be taken seriously. For starters, as shown by last week’s injunction involving Venu, sports broadcasting has become hot antitrust ground. Gutierrez, on the eve of his retirement, is entering judgment in favor of the NFL anyway, but the plaintiffs’ move foreshadows some of the legal fighting ahead.

And if you dig deeper, as I’ve noted, the data is slightly rosier. Once June began with Sony’s $400 million worldwide-grossing Bad Boys sequel, the industry saw nearly three months of uninterrupted best-case-scenario performances. Franchise flicks either performed as well as hoped (A Quiet Place: Day One, Despicable Me 4, Alien: Romulus, Bad Boys: Ride or Die) or aggressively overperformed (Inside Out 2, Deadpool & Wolverine, and, at least in North America, Twisters).

In retrospect, there are seven takeaways from a summer that wasn’t nearly as perilous as many feared. Herewith...

Then there’s the $100 million+ first installment of Kevin Costner’s four-film Horizon: An American Saga, which outright bombed ($34 million worldwide) and was quickly sent to PVOD after it opened theatrically in June. Alas, it may turn out to be the last installment in theaters, too. George Miller’s Furiosa: A Mad Max Saga earned the distinction of being the summer’s most high-profile tentpole flop ($172 million worldwide). Twisters overperformed domestically ($239.6 million and counting), courtesy of Universal, but Warners failed to translate that globally ($95.1 million). Unfortunately for Uni, the two studios share in the total pot equally.

Also riding the throwback train was the surprise success of the rerelease of Laika’s 2009 hit Coraline, which “opened” with $20 million worldwide. Likewise, Kingdom of the Planet of the Apes, which earned $400 million on a $160 million budget, was promoted as a continuation of the popular 2011 to 2017 reboot/prequel trilogy, which earned $1.6 billion, rather than an entry into a franchise that began with the acclaimed 1968 film starring Charlton Heston.

Alien: Romulus, however, did pitch itself as a sequel to the original 1979 Ridley Scott hit, skipping over Prometheus and Alien: Covenant. It was only because of a surprisingly solid showing in China that Disney can boast of a $109 million global launch, rather than $75 million, for the $80 million Romulus. That has been an exception to the rule this decade, as the industry now treats China’s box office as essentially found money. Speaking of which...

You could argue that Inside Out 2, Deadpool & Wolverine, and Despicable Me 4 earned so much in North American theaters that they don’t need to earn a penny overseas for profitability. However, three key releases that earned decent to strong domestic numbers—The Fall Guy ($92 million), IF ($111 million), and Twisters ($235 million thus far)—qualified as global misses due to comparatively poor overseas earnings. Indeed, Twisters may gross less overseas than Warners’ 2014 found-footage tornado flick Into the Storm, which complicates the story that domestic distributor Universal would like to tell about its $155 million disaster sequel. If at all possible, perhaps the next batch of tentpoles should be budgeted at a level where a 50-50 domestic/overseas split is enough to qualify as profitable.

But the consolidation of the moviegoing experience, where more of the annual spend is devoted to a smaller number of releases, means that we’re getting a semiregular output of these big-swinging, all-quadrant franchise flicks. This means each year is likely to bring a couple of once-unthinkably huge, industry-sized tent poles. And, more than ever, the studios need them to work.

Much of the online chatter over It Ends With Us has focused on a supposed behind-the-scenes conflict between Lively and the film’s director/co-star, Justin Baldoni. There’s also been online griping that the movie, which is clearly advertised in trailers as a domestic abuse drama, is being improperly publicized via jokey junket segments, glamorous red-carpet appearances, and related movie star razzle-dazzle at the expense of its relatively serious subject matter. However, strong word-of-mouth and terrific post-debut grosses—so far, it’s earned $180 million in two weeks of global play—would imply that anyone tricked into seeing the film came away happy.

We may be at the beginning of a genuine shift in audience sentiment. For more than a decade, marquee characters overtook actors as the prime box office variable, and Hollywood lost its ability to safely release original and new-to-you movies. Now, with the movie industry pulling back on direct-to-streaming, there’s an opportunity for moviegoers to get back into the habit of seeing an aspiring movie star like Austin Butler in a film like The Bikeriders. Of course, the question is always whether the industry is willing to weather the likely short-term losses for a potential long-term gain.

Yes, the industry still depends on sky-high tentpoles that tend to mostly be sequels, prequels and revamps from previously successful franchises. All-quadrant “take your whole family” generational nostalgia franchises have continued to perform. However, the industry needs to at least try to get casual audiences (especially older kids and adults) back in the habit of going to the movies just to see a random flick that (to quote Robert Forster in Jackie Brown) looks good and starts soon. It’s great that Gen Z is embracing Inside Out 2 and Despicable Me 4, but we need to get adults back into the habit of showing up for The Fall Guy and Fly Me to the Moon.

Even with stronger-than-expected overall box office earnings amid a smaller-than-it-should-be slate, the industry is still in the position of treating almost every theatrical release—even, presumably, surefire franchise tentpoles—as proverbial underdogs against the onslaught of social media distractions, A.I. dangers and tech company competition.

The good news is that, with straight-to-streaming releases having mostly proven to be of little value, and with both streaming ratings and new PVOD revenue boosting the allure of a theatrical release, the challenge is no longer justifying a robust and healthy multiplex marketplace. The challenge now is doing the slow, hard work to at least attempt to nurture more than just a handful of mega-bucks blockbusters. Admitting the problem is the first step to solving it.

Matt