Opinion ID: 2791704
Heading Depth: 3
Heading Rank: 3

Heading: Wilson’s Compensation

Text: The conclusion of unconscionability was also properly grounded upon the bankruptcy court’s decision that Wilson’s level of compensation under the 2008 AMA was excessive. The bankruptcy court looked to the language of the three AMAs setting forth Wilson’s duties as a “personal manager, advisor and counselor.” It also looked at the terms of the AMAs stating what Wilson was not (“an employment agent, theatrical agent, or licensed manager”), and what Wilson was not promising to do (“procure or produce or attempt to produce, and employment or engagements for the Debtor”). We see no error with the bankruptcy court’s assessment, when it compared Wilson’s role under the AMAs to the role of a personal manager as stated in an entertainment law treatise and the testimony of Mickey Gilley, that the duties listed for Wilson in 18 the AMAs were consistent with the definition of a personal manager. See Thomas D. Seltz, Melvin Simensky, Patricia Acton & Robert Lind, 1 Entertainment Law 3d: Legal Concepts and Business Practices § 8:7 at 1. And, the court properly pointed out the practical difficulty with the fee arrangement. After payment of Wilson’s 50% cut of gross proceeds and payment of all expenses from his own 50% share, the Debtor could end up with nothing. In addition, Wilson maintained that he operated as a sole proprietor, but his effective employee (the Debtor) was required to pay the sole proprietor’s expenses under both the 2007 and 2008 AMAs. The unconscionability decision is also supported by, as the bankruptcy court noted, the evidence that the traditional amount of compensation for a personal manager set forth in the employment law treatise and by Gilley (15% -20% or 10% - 25%, respectively) was consistent with the level of compensation in the 2005 AMA that was drafted by an attorney. See 1 Entertainment Law 3d § 8:7 at 1. The court took care to distinguish exceptions to the norm, giving a few examples including the King agreement and King himself, on valid and significant grounds.6 The record supports the decision that the King deal and the other exceptions referenced by the court were truly exceptions to the rule on compensation. We also agree with the bankruptcy court’s assessment that Wilson’s record and experience did not merit compensation at an exceptional level. And, the bankruptcy court appropriately discredited Wilson’s stated reason (that he was moving to representing the Debtor exclusively which carried additional risk for him) for the increase in the amount of his compensation (to 50%) from the 2007 AMA to the 2008 AMA. Lastly, we agree with the bankruptcy court that the 6 The court also distinguished Gilley’s 50/50 deal with his own manager and the compensation of the manager for Elvis Presley. 19 Debtor’s arrangement with Precious Princess Productions and Unchained Productions is distinguishable and irrelevant to the determination of unconscionability of the AMAs.