26
ASMP - NY News Aug. Update
July 31, 1996
By: Barry Tanenbaum , Editor, ASMP/NY News
The following article was written by Barry Tanenbaum, editor of the ASMP/NY News, the newsletter of the New York Chapter of ASMP. It was originally published in the July/August issue of that newsletter.
MPCA Fallout: Statements, Memos, Reports...and the "Doomsday Machine"
The weeks following the expulsion of Peter B. Kaplan and Alan Goldstein
from the National board (reported in the May/June issue of ASMP/NY News)
have been marked by comment, controversy and a flurry of postings to a
number of Internet sites.
Several documents considered confidential and private have been
made available to photo industry reporters. One, Alan Goldstein's report on
MPCA to the ASMP board, has been posted by Photo District News to their
web site.
At least two of the charges brought againt Goldstein-that he
"published outside the board a privileged communication" and that he made
and published "unsubstantiated accusations of malfeasance and other
statements of a libelous nature against ASMP and MPCA officers, staff and
members....[and]...incorrect and inaccurate statements concerning the
structure and purpose of MPCA, which, if true, would expose the Society to
potential anti-trust and tax liabilities...." pertained to his report of
February 28, 1996, in which he analyzed MPCA's financial structure,
strategies, current condition and likelihood of long-term success.
We've heard that while some members of the board initially praised
Goldstein's efforts, the situation changed when ASMP executive director
Dick Weisgrau and Society counsel Victor Perlman read it. They were
convinced that it compromised the Society and libeled certain ASMP board
members and officers.
Goldstein withdrew the report and rewrote it to reflect those
sensitive areas, but the result was his expulsion from the board.
PDN, which obtained copies of Goldstein's original and rewritten
report from an anonymous source, posted the original at their web site. At
this writing, the first report is available under "Association News" in the
news section of PDN's site at http://www.pdn-pix.com/news.html.
In the report, Goldstein wrote that "MPCA is not being run as a
separate entity. It is merely an alter ego of ASMP. This deviates from the
legal opinions that were solicited when MPCA was established."
He cautioned board members not to forget that "the Executive Board
members also serve on the MPCA board. So they shouldn't have much debate
among themselves when approving use of ASMP funds for MPCA. While they
might want to be objective, there is a conflict of interest here."
(Currently the ASMP board is the MPCA board, based on a decision made at
the last board meeting.)
"It was clear to me that MPCA...originally...was expressed and
intended to be a separate for profit corporation run as a subsidiary of
ASMP," Goldstein wrote. "In a memorandum written by J. William Gray to
Charles D. Ossala dated 9/5/1991, ASMP was clearly advised to form MPCA as
a separate for profit corporation."
"I have read the legal opinions that were prepared for ASMP in
regard to the formation of MPCA," he continued. "It is clear that we are
not following the suggestions offered by Mr. Ossala or Mr. Gray. I have
concern that we may be placing ASMP's non profit status into jeopardy by
diverging from their suggestions."
"The same people who are trying to develop MPCA have the power to
authorize and spend ASMP's capital," he wrote. "They can't be expected to
be objective.
Dick Weisgrau denies that ASMP acted against advice of counsel when
MPCA was established. "We followed their advice," Weisgrau said. "We set
MPCA up as a separate corporation. [T]he very same law firm that gave us
the legal opinions was helping us draw up all the papers to fulfill [them].
Alan Goldstein's report, in my opinion, [contains] a tremendous number of
inaccuracies.
"The main concern is that as soon as the report moved beyond the
board, it was no longer a privileged document." He is referring to the fact
that Goldstein sent a copy to a non-board member, Steve Sint, president of
the New York chapter.
"Also," Weisgrau said, "we know that he gave selected parts of the
report to both Robert Rathe and Vince Streano to read. He's admitted that.
Therefore he went beyond the board."
Weisgrau maintains that in the report Goldstein speaks as an ASMP
director. "As a director, he is held to a higher standard than any other
[Society] member....A director has a fiduciary responsibility to the
organization not to damage its interests. You can say anything you want
when you're a director, but you don't send it out beyond the board of
directors."
So charged is Goldstein's report that Victor Perlman, in a
confidential memo to members of the ASMP board dated March 12, 1996,
likened it to "a doomsday machine."
"Once set into motion, it is virtually impossible to defuse or
destroy it," he wrote. "Its mere existence creates a threat to ASMP, MPCA,
their Boards, Dick Weisgrau, Matt Herron, etc."
Perlman, writing that he sees only one course of action "that might
serve to reduce significantly, but not eliminate, the risk," suggests that
Goldstein ask for all copies of the report to be returned and that no
others be made.
One of the main points of Perlman's memo, which also refers to
Goldstein's report as a "Damoclesian sword" hanging over ASMP's head, is
that while Goldstein's statements are "factually untrue," no one in ASMP
wants to have to deal with the effort and expense of having to prove that.
Perlman points out that were the Society not to succeed in
litigation or an investigation, there would be potential criminal penalties
and personal liabilities for present and past officers and directors of
ASMP.
Perlman refused to discuss specific points of his memo, calling it
"a confidential and privileged legal opinion, and because of that it is the
absolute policy of the Society that it not be...published or discussed."
MPCA Issue Sparks Chapter Debates
The question of whether ASMP should continue to fund MPCA is by no means
limited to the upcoming referendum. At least two chapters have held
debate-and-discussion evenings to explore the issue, and one capped the
night by asking meeting attendees to cast votes.
The South Florida chapter held its MPCA meeting on June 13, with
ASMP executive director Dick Weisgrau presenting National's views. Said
chapter vice president Richard Marx, "It was a very laid back discussion.
People had strong opinions, but it didn't turn into a fiery debate."
Although no vote was taken, Marx felt that "the majority of people were
not in favor of continued funding of MPCA. They felt that it would be a
good thing if it worked, but they don't know if we're equipped to make it
work."
The Mid-Atlantic chapter held an MPCA debate on June 17th.
Representing those who support the cease-funding petition position were
Robert Rathe and Jim Pickerell. Speaking for ASMP's support of MPCA were
Dick Weisgrau and ASMP board member Matt Herron. Herron, grounded in
Chicago by bad weather, participated via phone.
The debate lasted well over an hour and was followed by an hour of
questions. When the audience was polled, 19 favored a halt in funding,
seven National's position.
Weisgrau framed the issue as one of "vision vs. vacuum," saying
that the world is changing while the petitioners want things to remain the
same. He and Herron placed emphasis on the value of the "secondary rights"
part of the CCC package. "It is the acquiring of images, the cost of
putting images of marginal value into an expensive on-line system and the
system for licensing primary rights that is causing the problem," Pickerell
maintained. "Therefore, why isn't it better to set up a separate operation
that just focuses on negotiating secondary rights?"
"The point is that there may be other ways to go," Pickerell added,
"and I'm not convinced that Dick is taking MPCA on the right course. Dick
makes the point that we need the power of an organization to help us in
negotiations because the publishers have always intimidated us when we try
to deal with them as individuals. It seems to me that by joining up with a
publisher-controlled organization we my simply be allowing them to control
us in a different way."
Said Rathe, "After three years, I'm convinced that MPCA is a
failing enterprise that will drag down our Society; eventually draining our
financial resources, our energy and our standing in the industry. In
addition, ASMP's traditional leadership in advocacy and education is being
compromised by the intense focus on MPCA."
Said Pickerell, "Our goal is not to kill MPCA. We simply want the
board to stop using ASMP funds and ASMP staff time to support MPCA. ASMP
has provided enough 'seed money.' It's time MPCA became self-sufficient."
Some Mid-Atlantic members took a middle ground position. They want
"more information and more control over...MPCA...but given how much effort
has already been put in, they would like to give MPCA another year to see
if it can really get off the ground," the chapter reports.
National's Education Plan Calls For Action At Local Level
April's joint meeting of chapter presidents and the National board in
Aspen, Colorado, was significant for more than the board's removal of two
members, although that event has drawn the most publicity and controversy.
Education was also on the meeting's agenda.
Earlier this year, when the position of ASMP education director was
eliminated, ASMP executive director Dick Weisgrau told us that ASMP had
"determined a different way to conduct [educational] affairs."
He said that education's larger role in the future of ASMP would
require that it have an equal amount of Society's resources. No longer a
single department, education would soon be "a major area."
Weisgrau indicated then that he was preparing a "strategic plan"
for the future of education. Part of that plan called for him to direct
educational efforts and transfer his legislative and legal issues
management to another person who was to be hired for that purpose. Shortly
after, Victor Perlman joined ASMP as full-time general counsel and managing
director, filling the legislative and legal issues management position.
The strategic education plan Weisgrau presented at the Aspen
meeting calls on local chapters to take a large measure of the
responsibility for fulfilling the Society's education goals. Local chapters
will be expected to devise educational plans, then supply volunteers to
carry them out. No details were provided about National's implementation or
support of chapter efforts, or what form that support might take.
Said Weisgrau of the overall task of education, "We don't have the
resources at ASMP to carry this out."
With chapter presidents accepting and the board approving his
"mission statement" for the Society's educational and legislative efforts,
Weisgrau said, "I'll turn now to creating the operational plans."
He added, "The only way we [can] deliver education, which is a
critical component of success, is if we can bring it to the level where all
photographers in the business can afford it and easily access it-meaning
delivering it in not only the largest but the smallest chapters we have.
"The staff could never be big enough within ASMP's budget to
deliver all this.
"My job is to plan how to do it, find the volunteers for it, get
the financing together for it, set up the programs and go out and do some
of the training myself."
He acknowledged that no plan could succeed "unless the chapters are
involved in [both] action and spirit." Asked what he would do if the
chapters don't come through with enthusiasm and help, if they are
apathetic, Weisgrau said, "I'll go to the board and say [that] this plan
cannot be accomplished with chapters the way they're acting; they're not
responding, not doing anything, and now I want permission to ignore the
chapters and go out and find my own people, and work in a way that I can
set this up in smaller venues without [chapter] support."
Hidden Agendas on MPCA?
A story in the May/June issue of the Colorado chapter's newsletter, ASMP
Colorado Image, caught our eye. "Weisgrau Defends MPCA," the headline reads,
and the piece reported on ASMP executive director Dick Weisgrau's April 24
appearance at a Colorado chapter meeting.
"Weisgrau seemed exasperated with a petition circulated by several
members to cut off ASMP financial support to the copyright collective,
characterizing it as a vote to continue or shut down MPCA," the story said.
"He said he would accept such a decision by members if it happens. He
suggested, however, that some of those who originated the petition had less
than altruistic hidden agendas behind their actions."
Wondering who he might be referring to and what their hidden
agendas might be, we called and asked him to elaborate.
"Steve Sint is on the record as believing that MPCA should not
exist in ASMP's hands," Weisgrau said. "He put that [opinion] on the
Internet. That's not [the same as saying] he wants MPCA to go forward, but
it just shouldn't be supported by ASMP. I don't have any problem with [him
having that position], [but] there [you have] one person, one of the key
organizers [of the petition] who has a different agenda than the referendum
states.
"I don't believe for a minute that Jim Pickerell's sole motivation
is the protection of ASMP. I do believe, however, that the vast majority of
petitioners conscientiously subscribe to what they signed, and that they
clearly believe that [it's] the best thing."
Weisgrau told us that he believes that there are people who support
the petitioners' side of the referendum who "don't really care about the
outcome of the referendum, but are supporting it because they are looking
for a political issue because they want to reach a level of power within
the ASMP that they do not [currently] have."
For some time we have heard that Weisgrau has a financial interest
in the success of MPCA through an arrangement made with the National board
at the time his contract was negotiated several years ago. This arrangement
supposedly gave Weisgrau a percentage of the profits of any project he
suggested and implemented. If true, this would provide him with his own
ulterior motive for the success of MPCA.
Weisgrau said he was grateful to have the chance to clear this up.
"When Image Bank wanted to hire me for $200,000-plus, the Society offered
me $150,000 to stay. I said I would stay, but I knew the Society could not
afford that amount." He said he would take $140,000 and defer $15,000 of
that for each year of the two-year contract. At the end of that contract
ASMP would owe him $30,000. He told the board that he hoped that over the
two-year period he would have the operation at a level where the board
could pay out the $30,000 to him over two years.
The board agreed. "I also put in the contract that I had a major
project I wanted to launch," Weisgrau said, "and I believed that this
project would make ASMP a lot of money. What I wanted was an incentive; if
I could make money [for the Society] on the project, over and above its
costs to ASMP, I would like to get a 20 percent commission on those
profits.
"I did not state the project. It was going to be the educational
program, which I was going to run myself. But immediately after signing
that contract I was diverted away from both education and MPCA, which was
already up and running, into two years of major copyright reform efforts. I
didn't do anything with education for that [time]. I hired [Emily] Vickers
to do it because I had no time, and then I gave [Ray] DeMoulin MPCA because
I had no time for that."
Weisgrau says that he never collected the deferred income. "We
rewrote the contract and I gave the money back. We [also] left the 20
percent thing out [of the new contract] because Strictly Business had
already been done, and I wasn't going to try to make 20 percent on a
program I had given to Emily Vickers to do."
He pointed out that his contract is with ASMP; he has no contract
with MPCA. "I make nothing [from MPCA}. For me it's a lot of extra work.
"I get no percentage of anything, no bonus income, no performance
payment, nothing of that nature. I have a straight annual salary [of]
$125,000." He concluded by saying that the latest story he had heard-that
he is getting paid by AGT and CCC-is untrue. "I have no income other than
my bank account, some small investments and ASMP. I don't even accept
honorariums."