Cruise’s United Artists, writers nearing deal

HOLLYWOOD – United Artists, the independent production unit of MGM controlled by actor Tom Cruise and his producer partner, Paula Wagner, is expected to become the first movie company to reach an interim agreement with the Writers Guild of America, enabling the recent start-up to hire union writers despite the continuing strike.

The guild, which is close to finalizing a deal with UA that is expected to be signed as early as today, is also in discussions with several other independent companies, including Lionsgate and the Weinstein Co., about similar interim agreements.

The agreement with UA would benefit the company’s distributor and majority shareholder Metro-Goldwyn-Mayer Inc. by supplying the studio with films once they are produced.

UA is a relatively small player in Hollywood, and a deal with the company is not expected to have an immediate effect on the larger dispute that has roiled the film and TV industry. Writers walked off the job two months ago, largely over pay for their work distributed on the Internet.

Since studios broke off talks in December, the guild has been attempting to sign up independent companies to put pressure on major studios to return to the bargaining table.

However, MGM, which unlike UA is a member of the Alliance of Motion Picture and Television Producers, does not plan to break ranks with the alliance’s other major studios and sign a similar side deal with the guild, according to people close to the situation who requested anonymity because they were not authorized to talk publicly. The alliance represents the major studios in negotiations with Hollywood’s labor unions.

In recent days, Harry Sloan, MGM’s chief executive, has been attempting to dissuade Wagner and Cruise from making an interim deal with the guild, people familiar with the situation said. But Sloan ultimately must defer to Wagner, who as chief executive of UA has the final word on how the company operates. Some people close to the matter cautioned that the deal between UA and the guild still could fall apart.

The pending agreement with UA is patterned after a similar deal the guild has struck with Worldwide Pants Inc., the production company owned by late-night host David Letterman.

Both agreements contain proposals that the union sought in negotiations with major studios, including in the key area of Internet residuals. Securing such deals is part of a strategy by the guild to present itself as a reasonable negotiating partner.

Wagner and Cruise, who have been production partners for more than 15 years, jointly own 35 percent of UA, with MGM and its equity partners controlling the majority shares.