Bona Law Represents Tony-Winning Producer Against Union’s Group Boycott Antitrust Violation on Appeal in the Second Circuit
July 6, 2023
Bona Law is representing Garth Drabinsky—renowned creative producer of live theater—in his appeal against defendant Actors’ Equity Association (“AEA”), the union that exclusively represents Broadway performers and stage managers.
This appeal filed in the United States Court of Appeals for the Second Circuit, challenges the district court’s grant of AEA’s motion to dismiss Mr. Drabinsky’s complaint, which alleges in detail that AEA instituted a defamatory smear campaign and a concerted group boycott against him in violation of federal antitrust and New York state laws.
AEA’s boycott against Mr. Drabinsky (memorialized on its “Do Not Work” list) is unprecedented. It precludes AEA members from accepting or continuing employment on any production in which Mr. Drabinsky serves as a producer or acts in any producing capacity in any field of entertainment including Broadway. The blacklist applies even if a production fully complies with the union’s collective bargaining agreement and all relevant health and safety protocols. If not stopped, the boycott against Mr. Drabinsky will continue in perpetuity. AEA’s conduct effectively eliminates, without justification or due process, a unique and legendary source of creative talent from the limited pool of producers who are able to create meaningful opportunities for stage actors. Indeed, Mr. Drabinsky is the creative force behind landmark Tony Award winning productions like Kiss of the Spider Woman, Hal Prince’s restoration of Show Boat, the original productions of Ragtime and Parade, Fosse, and most recently, Paradise Square.
While AEA does not deny that it has instituted the group boycott, it has argued that its anticompetitive conduct is shielded from antitrust liability by the statutory labor exemption. In certain cases, a union’s activities are exempted by statute from federal antitrust laws, but this exemption has strict limits; it applies only so long as a union acts in its legitimate self-interest (a defined term) and does not combine with non-labor groups. Phillip E. Areeda (late) & Herbert Hovenkamp, Antitrust Law: An Analysis of Antitrust Principles and Their Application ¶ 255a (4th and 5th eds., 2023 Cum. Supp. 2016–2022).
Whether a self-interest is “legitimate” is generally not susceptible to resolution on a motion to dismiss. But the district court here did just that: concluding that the exemption bars Mr. Drabinsky’s antitrust claim based on AEA’s factual assertions that the boycott was a legitimate response to member concerns about wages and working conditions. But those factual assertions are absent from Mr. Drabinsky’s complaint, and directly contradict his complaint, and so the district court should have completely ignored AEA’s assertions. For example, AEA claimed in its brief that Mr. Drabinsky withheld union wages, but AEA claimed in grievances and arbitrations against others (not Mr. Drabinsky) that wages were not his responsibility. Indeed, Mr. Drabinsky was not a contractual employer of AEA members responsible for wages or working conditions.
Mr. Drabinsky alleges that the boycott was unjustified—grounded in motives unrelated to wages and working conditions that cannot be identified more specifically except through discovery. The district court’s decision is troubling because, if affirmed, it sets a path for unions to escape antitrust scrutiny early at the pleadings stage through mere self-assurances that its wrongful conduct is legitimate. That result is inconsistent with precedent that the exemption’s application is best determined upon a full record, particularly where a union’s true intent requires resolution of factual disputes.
The district court also erred by dismissing Mr. Drabinsky’s negligence claim under the repeatedly criticized doctrine first articulated in the 1950s in Martin v. Curran, i.e., that certain state law claims may be asserted against unincorporated associations (like unions) only where “the individual liability of every single member can be alleged and proven,” requiring each member to have “expressly or impliedly with full knowledge authorize[d] or ratif[ied] the specific acts in question.” 101 N.E.2d 683, 686. The rule does not apply to negligence (one of Mr. Drabinsky’s state law claims), but the district court incorrectly ruled that it did.
Mr. Drabinsky also argues that the doctrine clashes with the real-life functioning of unions, which, due to their size, often delegate decision-making to a subgroup or a committee that does not require knowledge or ratification of every single union member (which, in AEA’s case is over 50,000) to make decisions. Martin, in essence, makes it impossible for individuals like Mr. Drabinsky to challenge a union’s defamatory or other intentional tortious conduct—an illogical result often criticized by state and federal courts.
Mr. Drabinsky is optimistic that the Second Circuit will recognize the district court’s errors and allow his claims against AEA to proceed.
Update: Bona Law’s reply brief, submitted on Mr. Drabinsky’s behalf, can be read here.