7 On Your Side has received complaints from several people saying they thought their kids were auditioning for jobs, then were hit up for money. What we found is that there are more laws governing talent companies than you may think.
The pitch starts with a card handed out to consumers at shopping malls around the Bay Area. The card states that Be Productions of Emeryville is now casting for TV shows.
Hundreds of would-be stars responded, like these families.
"Your child's so cute and we're holding this audition and why don't you come bring her and we'll see what happens," says Pamela Roney, a Walnut Creek customer.
After the audition and a callback, families found out this all came at a price -- as much as $4,400 up front.
"I was ready to go... well both my daughters broke out in tears and wore me down and I finally agreed to do it," says Roney. "But in retrospect, I'm very happy I did."
For the fee, kids get discount prices on services like singing classes, photo shoots, auditions and a chance to appear in two shows produced by Be.
Some parents said they're happy. Others have regrets.
"But then I got slammed with the price," says Sandra Flores.
Sandra Flores signed a $4,000 contract for her daughter. Corina Flores, no relation to Sandra, signed a $3,000 contract for her son.
"After I came home, my reality kicked me in the butt," says Corina Flores. "I can't do it. I can't afford it."
Both women called the company right away to cancel. Be said no because Sandra and Corina both failed to cancel in writing within three days as required by the contract.
So what are consumers' rights? If this is an ordinary contract, they are probably out of luck.
However, 50s' child star Zelda Gilroy says it is not ordinary. If you like TV reruns, you might recognize the feisty Gilroy from the old Dobie Gillis TV show. What does she have to do with this? Gilroy grew up to be powerful State Senator Sheila Kuehl and she wrote a powerful state law to regulate the type of talent companies that scout clients in public places.
"These people seem to be drawing you in. They'll go to the mall and they'll say you should be on television or your kid should be on television, just sign up with us and pay us a fee," says Kuehl. "We called them in the law, 'advance fee talent agencies' to separate them out because these people were charging a fee up front for services they hadn't provided yet."
The law is Section 1701 of the California Labor Code. It says talent companies that charge an advance fee must follow lots of rules, such as:
- Register with the state
- Post a $10,000 bond
- Give consumers 10 days to cancel in writing
- Refund all money if the artist does not get the expected services
- Cannot profit from referring clients to classes
"We are not governed by 1701," says Be Productions owner Erik Desando.
Desando says Be Productions, formerly known as My Artist's Place, does charge fees up front and does help kids get into show business, but it is not an advance fee talent service. He says Be doesn't actually provide the talent services like photo shoots, singing lessons and auditions. Rather, his company uses outside contractors. His company is more like a club.
"Those things you're talking about, they're being done, but they're being done by outside companies, not ours. So, in other words, (if) you want to meet an agent through us, you can't meet an agent through us. You have to meet an agent through the showcase company we contract with," says Desando.
But 7 On Your Side investigated and found the showcase company that Be contracts with is Dynamic Showcases. State records show Desando is the chief executive officer of Dynamic Showcases and Be co-owner Barry Falck is a principal executive.
We reached Desando by phone. He told us he did own Dynamic Showcases, but in order to comply with Section 1701 he sold it to Barry Falck's son, Ryan Falck.
"When we discovered we couldn't own it, we sold it to Ryan, but he didn't follow through with the correct state documents. We never made any money on the company, but we made a deal," said Desando.
Desando said he did not recall when the sale was made.
We checked and found Ryan Falck's name was added to the corporate documents in June after 7 On Your Side began asking questions.
Be's other main contractor is Rising Stars, a school that provides acting, singing and dancing lessons. Be is linked to that company, too, providing videos for Rising Stars. Desando tells us he does not make any money from those videos so there is no conflict.
ABC7 legal analyst Dean Johnson says using outside vendors would not exempt Be from the law, anyway.
"They take an advance fee and for that fee you get access to essentially everything that an artist would want to develop his or her career," says Johnson. "That is the kind of service that is exactly what the authors of the talent service agencies statute intended to cover."
The author agrees.
"They do fall under the definition of advance fee talent agencies, so in and of itself, by not posting a bond they are violating the law," says State Sen. Kuehl. "We made the law very broad in order to snare these kinds of folks."
We asked Desando if he could see why someone would think he would fall under 1701.
"Nope, not if they know our business," says Desando. "I've got our own high priced attorneys there telling us, you're not, we don't sell talent services."
Be started in Southern California. The Better Business Bureau of Los Angeles gives the company an "F" rating, mostly because it is operating without a license or registration.
"They're accepting fees in advance without the proper bonding or registration for what looks to us like jobs. If you look at their flyer, it says casting now for these television shows," say Gary Almond with Better Business Bureau.
"This really smacks right into the advance fee talent services because it is indirectly providing service to the talent," says Dean Fryer with the Labor Commission.
Still, Desando says, not me.
"Sheila's reason for the 1701 is to take unscrupulous operators that overcharge for services because they make promises they can't keep. Let's get rid of those companies. Let's get 7 On Your Side out there. Let's get rid of them. I'm completely for it and I'll go along with you arm in arm, you and I," says Desando.
The Better Business Bureau received 26 complaints about Be, many saying they thought their kids were auditioning for TV, others had a hard time canceling. An Antioch woman won a small claims judgment against Be after she tried to cancel by phone and could not. Finally, after we got involved, Be let both Sandra Flores and Corina Flores out of their contracts and refunded almost all their money.