Catfish Documentary Sparks Fair Use Battle

Ever since Catfish premiered at Sundance in January, the documentary has engendered controversy. Made for just $30,000, it grossed more than $3 million and has left audiences scrambling to figure out whether the amazing story being told is just an elaborate hoax.

We might get an answer to that question, thanks to a lawsuit filed today in U.S. District Court in Los Angeles against distributors Universal and Relativity Media, as well as the directors and producers of the film. The lawsuit filed by Threshold Media seeks statutory damages and profits from the defendants and an injunction.

In one of the crucial scenes of Catfish, Angela-posing-as-Megan sends Nev a song that she claims to be hers. It wasn’t, of course. In truth, it was a YouTube version of the song All Downhill From Here by singer-songwriter Amy Kuney, who is signed to Spin Move Records, owned by Threshold Media Corp. Later in the film, during the closing credits, Kuney's entire song is again played.

At first, Spin Move seemed proud of Kuney’s quasi-involvement in the film, touting it on its website. But the record label soon removed the post.

For some time now, Threshold has been attempting to get filmmakers to pay licensing fees for the song. According to the new copyright infringement lawsuit, the producers have rejected doing so. According to Threshold’s LA lawyer, Neville Johnson, the producers claimed that since the song was part of a real-life documentary, it was a “fair use” of the copyright. More.

SAGWatch News Aggregator Cleared of Wrongdoing

The anonymously run SAGWatch website, which aggregates news about SAG, AFTRA and other Hollywood unions, has long come under fire by members of SAG’s MembershipFirst faction, the now all but defunct group associated with former guild president Alan Rosenberg. They criticize the site for its pro-merger and anti-MembershipFirst stance.

In October, as The Hollywood Reporter reported, anonymous claims surfaced that AFTRA board member David Browde runs the website and that by so doing was in violation of an agreement between SAG and AFTRA that prohibits leaders of each union from disparaging the other union. Browde told THR then that the accusation was false. AFTRA said it would investigate.

On Wednesday, AFTRA released a statement that its outside counsel had concluded an investigation and "found no evidence suggesting any infractions (of the non-disparagement agreement and the union's own confidentiality rules) took place." More.

Ex-Associate Sues Akin Gump for Biased Termination

An ex-associate in Akin Gump Strauss Hauer & Feld's New York office has sued the law firm, claiming Akin Gump discriminated against her when it fired her for purported economic reasons in 2009.

Tameka Simmons, who said she was the only black female attorney in the New York office before being let go, accused the 800-lawyer firm of creating "pretextual" economic reasons for her firing. The lawsuit, filed in the U.S. District Court for the Southern District, also accuses the firm of denying Ms. Simmons mentoring, supervision and work opportunities promised when she was recruited from Debevoise & Plimpton in 2007.

Ms. Simmons, who is claiming discrimination and retaliation under federal and state law, is seeking unspecified compensatory and punitive damages. She also is seeking to force Akin Gump to reinstate her as an associate and pay her the earnings and benefits she would have received had she not been fired. More.

Quadrangle Group's Steve Rattner Charged in Pay To Play Scheme

The Securities and Exchange Commission earlier this month charged former Quadrangle Group principal Steven Rattner with participating in a widespread kickback scheme to obtain investments from New York’s largest pension fund.

The SEC alleges that Rattner secured investments for Quadrangle from the New York State Common Retirement Fund after he arranged for a firm affiliate to distribute the DVD of a low-budget film produced by the Retirement Fund’s chief investment officer and his brothers. Rattner then caused Quadrangle to retain Henry Morris – the top political advisor and chief fundraiser for former New York State Comptroller Alan Hevesi – as a “placement agent” and pay him more than $1 million in sham fees even though Rattner was already dealing directly with then-New York State Deputy Comptroller David Loglisci and did not need an introduction to the Retirement Fund.

The SEC alleges that after receiving pressure from Morris, Rattner also arranged a $50,000 contribution to Hevesi’s re-election campaign. Just a month later, Loglisci increased the Retirement Fund’s investment with Quadrangle from $100 million to $150 million. As a result of the $150 million investment with Quadrangle, the Retirement Fund paid management fees to a Quadrangle subsidiary. By virtue of his partnership interest in Quadrangle and its affiliates, Rattner’s personal share of these fees totals approximately $3 million.

Rattner agreed to settle the SEC’s charges by paying $6.2 million and consenting to a bar from associating with any investment adviser or broker-dealer for at least two years.

“New York State retirees deserve investment advisers that are selected through a transparent, conflict-free process, not through payoffs, undisclosed financial arrangements and movie distribution deals,” said Robert Khuzami, Director of the SEC’s Division of Enforcement. David Rosenfeld, Associate Director of the SEC’s New York Regional Office, added, “Rattner delivered special favors and conducted sham transactions that corrupted the Retirement Fund’s investment process. The assets of New York State workers were invested for the hidden purpose of enriching Morris and Loglisci’s brother.”

The SEC previously charged Morris and Loglisci for orchestrating the fraudulent scheme that extracted kickbacks from investment management firms seeking to manage the assets of the Retirement Fund. The SEC charged Quadrangle earlier this year.

According to the SEC’s complaint against Rattner filed in U.S. District Court for the Southern District of New York, Morris informed Rattner in the fall of 2003 that Loglisci’s brother was involved in producing a film called “Chooch.” Morris suggested that Rattner help Loglisci’s brother with the theatrical distribution of the film. Rattner met with Loglisci’s brother and agreed to assist him, but Rattner’s efforts did not lead to a distribution deal. Approximately one year later, Loglisci’s brother contacted Rattner about DVD distribution of “Chooch.” Within days of speaking to Loglisci’s brother, Rattner contacted Loglisci about investing in a new Quadrangle private equity fund being marketed by the firm. Rattner told Loglisci that he had arranged a meeting between Loglisci’s brother and a Quadrangle affiliate — GT Brands — to discuss a possible DVD distribution deal.

The SEC alleges that after Loglisci’s brother met with GT Brands and telephoned Rattner to complain about the treatment he had received from GT Brands, Rattner warned a GT Brands executive to treat Loglisci’s brother “carefully” because Quadrangle was trying to obtain an investment through Loglisci. After GT Brands made clear to Rattner that it was not interested in distributing the film, Rattner instructed the GT Brands executive to “dance along” with Loglisci’s brother. According to an e-mail, Rattner telephoned Morris to inquire whether “GT needs to distribute [the Chooch] video” in order to secure an investment from the Retirement Fund. Morris offered to “nose around” to determine how important the DVD distribution deal was to Loglisci. GT Brands ultimately reversed course and offered to manufacture and distribute the DVD at a discount from its standard fee. Rattner approved the proposed terms of the distribution deal.

The SEC’s complaint alleges that in late October 2004, after Rattner and others from Quadrangle had already met with Loglisci and the Retirement Fund’s private equity consultant and received encouraging feedback from both of them, Morris met with Rattner and offered his placement agent services to Quadrangle. Morris warned Rattner that Quadrangle’s negotiations with the Retirement Fund could always fall apart. Although Quadrangle was already working with a placement agent, Quadrangle agreed to pay Morris as well.

According to the SEC’s complaint, soon after Quadrangle retained Morris as a placement agent and Rattner had advised Morris that GT Brands was moving forward with the deal to distribute the Chooch DVD, Loglisci personally informed Rattner that the Retirement Fund would be making a $100 million investment in the Quadrangle fund.

The SEC alleges that Morris later contacted Rattner and pressed him for a financial contribution to Hevesi’s re-election campaign. Although Rattner purportedly had a personal policy that he would not make political contributions to politicians who have influence over public pension funds, Rattner agreed to find someone else to make the contribution. After speaking with Morris, Rattner asked a friend and the friend’s wife to each contribute $25,000 to Hevesi’s campaign. The day after these contributions were communicated to Hevesi’s campaign staff, Hevesi telephoned Rattner and left him a message thanking him for the contribution. In late May 2006, Rattner’s friend transmitted the promised campaign contributions to Rattner, who forwarded the two checks to Hevesi’s campaign. Approximately one month later, Loglisci committed the Retirement Fund to an additional $50 million investment in the Quadrangle fund.
In settling the SEC’s charges without admitting or denying the allegations, Rattner consented to the entry of a judgment that permanently enjoins him from violating Section 17(a)(2) of the Securities Act of 1933 and orders him to pay approximately $3.2 million in disgorgement and a $3 million penalty. The settlement is subject to court approval. Rattner also consented to the entry of a Commission order that will bar him from associating with any investment adviser or broker-dealer with the right to reapply after two years.

The SEC’s investigation was conducted by Joseph Sansone and Maureen Lewis of the New York Regional Office. The investigation is continuing.