8 N.Y. Modeling Firms Accused of Price Fixing

Eight top modeling agencies were accused in a class-action lawsuit Tuesday of violating federal antitrust laws since the 1970s by fixing the fees they charge models for finding them work.

California models Amanda Masters, Justin Klentner, Carolyn Fears, Lorelei Shellist, Barbara Cheeseborough and Carla Gross allege in the lawsuit that Elite Models Inc., Ford Models Inc., Wilhemina Model Agency Inc. and five other New York-based agencies formed an association in the 1970s and held monthly meetings to keep each other--and smaller competitors--from underpricing each other.

The eight agencies, who together control the lion’s share of the modeling market, currently charge models 20% of their pay per job--10% more than employment agencies are allowed to charge under New York law, lawyers for the models said. In addition to the fees from models, agencies also charge the employers who hire them 20%, the lawyers said.

Katie Ford, chief executive of Ford Models, said she hadn’t seen the suit and denied the allegations.

“There has been absolutely no price-fixing in the industry,” she said.

Part of the alleged conspiracy involves an agreement in the 1970s to describe themselves as managers instead of employment agents to circumvent the New York law, the lawyers said.

“If you procure employment, you are an agent,” said Brian Rishwain, a Los Angeles lawyer representing the models. “They charge 100% more than they are allowed to in New York, and, in order to maintain that, they’ve all gotten together and colluded to set a price.”

The models who filed the suit are “representative of the 95% of models who are out there--the non-supermodel who can’t negotiate [like] the big players can,” Rishwain said. “They are not Christy Turlingtons.”

Models sign such disadvantageous contracts with agencies because they typically start out young, are not well represented and fear getting blackballed from the business, said Andrew Hayes, a New York lawyer for the models who is a partner in the law firm of David Boies.

“The only way models can get jobs is to be listed with a modeling agency,” Hayes said.

The relatively few models who do attain supermodel status hire managers and lawyers who recognize the unfairness of the contracts and negotiate their clients out of them, he said.

Klentner, who quit modeling a few years ago after a career in major print campaigns including Calvin Klein and Versace, said industry practices are stacked against the talent. He said the Screen Actors Guild represents its members for a 10% fee and offers a pension and health insurance.

“I modeled for 15 years and I’m not vested for any kind of pension or anything,” Klentner said.

If the lawsuit succeeds in obtaining class-action status, it could result in damages awarded to thousands of current and former models who have worked for the agencies since the alleged conspiracy began.

Hayes said the lawsuit is unprecedented but is similar to litigation brought by his firm against auction houses Sothebys and Christies, which were convicted in 2000 of price fixing. Usually, lawsuits by injured parties follow criminal prosecutions in antitrust cases, as has happened with the auction houses, which have faced claims from customers in the wake of the conviction.

But it also can work the other way, said Tom Campbell, an antitrust law professor at Stanford University. If the models prove their case, the lawsuit could lead to prosecution under criminal antitrust laws.

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Times staff writer Ronald D. White contributed to this report and Bloomberg News was used in compiling it.