In 1939, California implemented the nation’s first law requiring employers of child entertainers to set aside a portion of the child’s pay in a trust until the minor’s 18th birthday.
This so-called “Coogan Law” (named for a famous child star whose parents stole all the money he earned in Hollywood) was designed to ensure that even kids with less than scrupulous parents would have something to show for their work when they reached adulthood.
Today, California employers are required to deposit 15% of a minor performer’s gross income directly into a blocked “Coogan Account” which cannot be accessed by anyone except the minor once they reach age eighteen.
COOGAN LAW GOES NATIONAL
In recent decades, more and more productions have moved out of California to shoot “on location” in states that offer generous tax incentives to producers who are willing to bring Hollywood to the heartland. As a result of this boom in local TV and movie production, several of these states have passed their own version of California’s Coogan Law to protect the income of their own child performers.
As of 2019, New York, New Mexico, Louisiana, Tennessee, North Carolina, and Pennsylvania all have laws on the books which are comparable to Coogan. However, it is worth noting that only California, New York, and Florida permit judicial approval of minors’ contracts (See my post “Is a Contract With a Minor Binding?” for more on this).
This distinction between states with Coogan laws and states which permit minor’s contracts to be approved is relevant because the vast majority of contract approvals are sought and obtained in California, regardless of where the shoot is actually taking place. This is because California makes it very easy to establish jurisdiction for the purposes of applying for approval of a minor’s contract. Even if the minor is an out of state resident and the production itself is out of state, the producer can still apply to the California court for approval of the minor’s contract as long as the production company “has its principal office for doing business in the state of California” in California.
In practical terms, this means that a producer can shoot a movie in Louisiana using local Louisiana kids who have never set foot in California, but still file for approval of that kid’s contract in Los Angeles County as long as that producer has an office in LA.
Even stranger is the fact that California requires that any contract approved by its courts must use a Coogan account located in the state of California. The bizarre result of this mandate is that there are thousands of kids living in states with fully functional Coogan laws whose money is nevertheless sitting in a bank 3,000 miles away in a sate they have never visited.
If you have questions about compliance with California’s Coogan Law, contact us today.
