Contributing Author: Bryan Sullivan

In the face of the global coronavirus (COVID-19) pandemic, entertainment consumption has been key to feeling a modicum of normalcy. Even during crises, going to the movies and watching TV provides a familiar sense of shared experience. As TV and movie productions slowly start filming again to make up for the current dearth of streaming content, questions have arisen about the legal issues surrounding resuming production and consumption, particularly “in-person outings.”

Movie theaters are set to reopen soon, and many people question if an uptick in case transmission will cause the theater business to face the same “start/stop” fate as the restaurant and other live entertainment businesses. Governments are in uncharted territory, attempting to balance safety with the prospect of many businesses having to cut workforces or shut down completely. CAA laying off 90 agents and furloughing another 275 is an example of the pandemic’s toll on the entertainment industry.

From casino and hospitality company Caesars to the new SoFi stadium in Inglewood, CA, reopening plans are moving ahead but, as cases have spiked, those openings are teetering. Movie theaters have seen a rebirth of the drive-in, while facing a slow-paced and tentative re-opening with limitations on capacity in some areas, and requirements for patrons to wear masks. Sporting events have begun to resume with limitations on spectators, but may face more shutdowns as infections spread.

Attorney Natela Shenon, who is representing 60Out Escape Rooms in an ongoing case, says California and Los Angeles County are “overstepping their executive powers by not analyzing the closures from a perspective of balancing hardship/benefit vs. risk of covid.” “The closure and reopening orders have been sloppy and vague. The County is wasting taxpayers’ dollars on useless litigation when all they have to do is fix their own oversights. There is a disconnect between health objectives and constitutional rights,” she adds.

But in these unprecedented times, local and state governments are using legal authority to make the rules. In Professor Evan Gerstmann’s Forbes piece he notes that “the courts will likely grant the government a lot of latitude.” However, “while the government must act forcefully to protect public health, it would be best if restrictions were enforced flexibly,” Gerstmann adds.

Further, “guideline confusion” makes things difficult for production and other entertainment companies as they resume operations. For film and television productions, local, county, and state guidelines and requirements often supersede union requirements or those put forth in a white paper by the Alliance of Motion Picture and Television Producers (AMPTP) in conjunction with the Directors Guild of America, SAG-AFTRA, and MPA. These guidelines are at times vague, and may contradict each other or pass the buck. California’s guidelines for Music, Film and Television Production indicate that productions should follow “safety protocols agreed by labor and management,” while the state of Georgia “encourages film and television companies to develop strategies to support the health and safety of their cast and crew as production activity restarts,” offering only a few general guidelines on safety protocols.

Even the white paper, the most thorough of these industry-specific guidelines, references “adequate ventilation of indoor locations” without going into any detail or providing a resource to turn to for further guidance on what is considered a workplace, or what standard should be used to determine what is “adequate.”

Thus, it is understandable that some businesses, unable to procure adequate insurance, might be reluctant to open when opening would leave them susceptible to lawsuits from employees.

Employment lawyer Benjy Smith of Smith & Benowitz notes that when attempting to reopen: “Companies must provide personal protective equipment, implement physical distancing and safety protocols to the maximum practicable extent, clearly communicate a strong anti-retaliation policy, and, most importantly, maintain an open dialogue between staff and management about safety concerns consistent with the anti-retaliation policy. Also, companies must maintain employment practices liability insurance and workers’ compensation coverage.”

Smith adds, “companies need to recognize that things like positive Covid-19 tests and related workers compensation claims are basically inevitable, but they can minimize risks by taking safety concerns seriously; recognizing that safety protocols will likely evolve over time; and using employee feedback to help improve practices on an ongoing basis.”

Since regulations and enforcement have been inconsistent, and guidance often either incomplete or vague, business owners nationwide will continue to have to react quickly, since adaptations can be out of date almost immediately. For in-person entertainment venues like movie theaters, music halls, arenas, escape rooms, and theme parks, adapting can take a more committed approach to the physical space, and such measures will be harder to revise halfway through. It may be crucial for any re-opening efforts that these businesses be afforded a review process, and clearer guidance on the requirements they face from their city, county, and state.

Concerns over clear and definitive guidelines are certainly valid. For businesses to thrive in the face of a crisis like Covid-19, it is critical that any enforcement actions, such as closures, fines, or criminal proceedings be based on policies that are fair and well-defined. If policies are unclear, and businesses are unfairly penalized, the ensuing litigation could be incredibly costly, and the human cost of lost jobs may be even higher.

Bryan Sullivan, Partner at Early Sullivan Wright Gizer & McRae, advises and represents his clients as a legal strategist in all their business affairs. He has significant experience on the litigation and appeals side of the practice, as well as with entertainment and intellectual property contracts, investment and financing agreements, and corporate structure documents on the dealmaking side.