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The WGA Strike Deal and Implications for Lawyers and Contracts

The entertainment industry witnessed a significant upheaval with the recent Writers Guild of America (WGA) strike. The repercussions of this event will undoubtedly ripple through several sectors, including the legal domain. For law firms specializing in entertainment transactional law, such as Sehgal Law PC, it's crucial to understand the contours of the strike deal and its implications on legal contracts. In this article, we will delve into what lawyers need to know and anticipate regarding the changes to contracts in the entertainment space.

Background of the WGA Strike

Before diving into the contractual nitty-gritty, it's essential to understand why the strike occurred. The WGA's strike primarily revolved around demands for increased pay, better residuals from streaming services, enhanced health benefits, and stronger creative rights.

The entertainment industry has seen an unprecedented shift over the past decade. Streaming platforms are becoming dominant players, and traditional modes of content delivery are evolving. These changes have led to shifts in revenue streams, necessitating adjustments in how creators, including writers, are compensated.

Key Takeaways for Lawyers:

1. Streaming Revenue: One of the significant outcomes of the strike deal pertains to streaming residuals. Writers wanted a fair share of the profits generated by streaming platforms. As these platforms grow in importance, contracts will now need to contain clauses that specify residuals from streaming revenues. Lawyers must be aware of these new stipulations and incorporate them into contracts.

2. Compensation Structures: With the new agreement, there will likely be changes in how writers are compensated. For instance, shorter seasons, which are common on streaming platforms, might lead to changes in per-episode payments. Legal professionals must be proactive in understanding these revised compensation structures to draft and review contracts accurately.

3. Health and Pension Benefits: The strike also brought attention to the health and pension benefits of writers. As part of the deal, there are expected enhancements in these areas. Contracts will need to specify these increased benefits clearly, ensuring that there's no ambiguity, which could lead to potential conflicts later on.

4. Creative Rights: The WGA also demanded better creative rights, which could imply stronger contractual terms related to attribution, creative control, and even possible veto powers in certain scenarios. Lawyers will need to be vigilant in ensuring these rights are contractually guaranteed and protected.

5. Exclusivity Clauses: As the industry evolves, so do the formats and mediums. There might be demands from studios or platforms for exclusivity, limiting writers from working on multiple projects simultaneously. Lawyers must be attentive to these clauses, ensuring that they are fair and that writers' rights are not unduly compromised.

Adapting Contracts:

For law firms like Sehgal Law PC, it's essential to stay ahead of the curve. Here are some steps to consider:

  • Continuous Learning: Regularly organize workshops and training sessions to keep the team updated on the latest industry changes.

  • Collaboration: Collaborate with industry insiders, writers, and other stakeholders to gain first-hand insights into their expectations and concerns.

  • Standard Contract Review: Periodically review and update the standard contract templates to reflect the new realities of the entertainment industry.

  • Client Counselling: Proactively inform and guide clients on the changing landscape, ensuring they are well-prepared for the future.

The WGA strike deal is not just an isolated event in the entertainment world. It reflects the broader changes and challenges the industry faces in the age of digital transformation. For law firms, it offers an opportunity to refine their expertise, ensuring they remain invaluable partners to their clients in navigating this evolving landscape. At Sehgal Law PC, we are committed to staying abreast of these changes, providing our clients with the most informed and strategic legal advice in the entertainment transactional law domain.

BUT WAIT! What about AI?

The emergence of Artificial Intelligence (AI) in scriptwriting, content creation, and even in predictive audience analysis is revolutionizing the entertainment industry. In the recent WGA strike deal, the role and impact of AI was indeed addressed.

Implications for Lawyers:

1. Royalties and Credits: If AI tools are used to assist or even autonomously create scripts, there will be questions about royalties and credits. Who owns the rights to content partly or entirely generated by AI? Is it the developer of the AI, the user, or the studio that deploys it? Lawyers will need to draft contracts that clearly delineate ownership and rights when AI tools are utilized.

2. Ethical Concerns: The use of AI brings forth several ethical concerns. For instance, if an AI tool was developed using the works of past writers, how is their contribution acknowledged? Lawyers will need to ensure that contracts cover such ethical considerations.

3. Liability: If content generated or aided by AI leads to controversies or legal conflicts, who is liable? The developer, the studio, or the end-user? Clear clauses regarding liabilities related to AI-generated content will need to be integrated into contracts.

4. Training and Use: Contracts may also need to spell out the specifics about how AI tools are used. For instance, are there guidelines or standards for training AI systems? Do writers and creators need specific approvals before deploying these tools?

5. Exclusivity and AI: If a writer or a studio uses a specific AI tool, is there an exclusivity clause? Can that tool be used for competing projects or by rival studios? Lawyers must anticipate and address these questions in contracts.

Adapting Contracts for AI:

  • AI-specific Clauses: Given the novel nature of AI in entertainment, standard contracts may not suffice. Lawyers should consider developing AI-specific clauses or even separate contract modules addressing AI's unique challenges.

  • Collaboration with Tech Experts: It's essential for entertainment lawyers to collaborate closely with tech experts to understand the intricacies of AI tools. Such insights will be invaluable in drafting contracts that are both legally sound and technically accurate.

  • Client Education: Given AI's complexity, clients may not fully grasp its implications. Proactive education and counseling about AI's potential benefits and pitfalls will be crucial.


The integration of AI in entertainment is uncharted territory, bringing both innovation and uncertainty. The recent WGA strike deal's acknowledgment of AI underscores its growing relevance. As the industry navigates this new frontier, law firms like Sehgal Law PC will play a pivotal role in shaping the legal framework that ensures fairness, creativity, and innovation coexist seamlessly.

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