Episode Transcript
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Danessa Watkins (00:00):
welcome to
Litigation Nation. My name is
Danessa Watkins, here with my cohost, Jack Sanker. And this is
the show where we cover the mostexciting and interesting legal
news from across the country. Asa reminder, we have shows coming
out every 2 weeks, and you canfind us on Apple, Spotify,
YouTube, and wherever you getyour podcasts. Jack, what do you
have teed up for us today?
Jack Sanker (00:20):
So the adult
subscription website, OnlyFans,
has been sued for fraud andviolation of federal
racketeering statutes for thealleged widespread use of online
impersonators who would pose asmodels or performers, chat and
talk with subscribers, andallegedly, through those kind of
interactions, scam thesubscribers out of more money
online. This one's kind of superinteresting, kind of risque, but
(00:42):
I think we can handle it withclass on the show.
Danessa Watkins (00:45):
Well, in a
similar vein, I'm also covering
something to do withinfluencers. A little less
risque though. It is the newIllinois law that went into
effect as of July 1, 2024, andthis is forcing influencer
parents to compensate theirchildren for appearing in social
media content. I'm also gonnadiscuss the secret family battle
(01:08):
for the Murdoch news empirethat's being fought out in
probate court and just came tolight recently. All that and
more, here's what you need toknow.
Jack Sanker (01:20):
At the intersection
of technology, the influencer
economy, and adultentertainment, there kind of
stands one name above all aboveall else, OnlyFans, which is the
online subscription platformthat hosts mostly adult
performers and models. Danessa,why don't you tell listeners all
about OnlyFans?
Danessa Watkins (01:42):
Of course you
would put me on the spot like
that.
Jack Sanker (01:44):
I'm kidding. No. I
got I haven't. I'm gonna do
Danessa Watkins (01:49):
it.
Jack Sanker (01:51):
OnlyFans is a,
subscription based content
creator platform. It's reallykind of in its essence no
difference from, you know, say,a lot of other platforms like
Patreon or Substack, or anyother content subscription
platform, which themselves arereally not much different than,
like, subscribing to a newspaperor a magazine or anything like
(02:12):
that. It's just kind of theonline way of doing that. So you
pay monthly for access tocontent. You know, if it's The
New York Times, you're you'regetting a a copy of The New York
Times to read, you know, everyweek or whatever it is.
If it's only contents that'sbeing posted by the creators
that are on there. OnlyFans iskind of, infamous for being in
(02:37):
on an adult content site,pornography. It does, as I
understand it, and I think maybeeven been intended to do other
things, like, you know, blogposts or, like, online coaching,
so, like, workouts and thingslike that. But it's kinda just
become exactly this, like, youknow, adult content and
(02:58):
everything else. One thing thatOnlyFans does and, again, a lot
of these these other onlineplatforms do, but it's kind of
what we're gonna be talkingabout here today is it offers
the ability of subscribers, toreach out and send messages to
the models and performers, thatare on the website often for a
price.
(03:18):
And you can imagine that thecontent of those messages, is
often pretty, you know, racy, atleast according to the class
action complaint that we'regonna be talking about here
today. The underlying crux ofthis class action that was just
recently filed, by the firm ofHagans, Berman, Sobel, and
Shapiro in the central districtof California is that the
(03:40):
creators often farmed thoseinteractions, the actual, like,
chatting with the subscribersout to, offshore chat farms and
then and I think in some cases,even AI. So think about, like,
call centers, you know, if youcall in for customer service or
something like that, kind of asimilar setup, except those
types of setups are respondingto messages from subscribers
(04:02):
online. Again, the topics ofwhich are often, like, pretty
lewd, you'd imagine. Theplaintiffs in the suit who were
subscribers, to creators andOnlyFans, are claiming that they
were defrauded when paying tochat with who they thought were
the models, but it turns outthey were actually chatting with
these, like, subcontracted chatcall center people.
(04:26):
And the actual, complaint itselfnames both OnlyFans the company,
as well as a number of theagencies that represent the
creators who, according to thecomplaint, set the creators up
with these different chat farmsand kind of manage them directly
as part of their, talentmanagement, and they would do it
(04:50):
and take a fee for it.
Danessa Watkins (04:52):
Is this all
like, do you chat through the
through the program? Or arethese, like, text messages
outside of of, OnlyFans? I don'tknow if that came up at all.
Jack Sanker (05:06):
I don't know, to be
honest. I think I mean, I so,
like, I, like, I know so, like,I use Substack, for example. And
you can, like, just send amessage to the to the author of,
you know, a Substack article.And it's it's within the app. So
I I don't I I would assume it'sprobably, like, via OnlyFans.
(05:29):
Right?
Danessa Watkins (05:30):
Like like
sending, yeah, like, private
messages, that sort of thing.Yeah.
Jack Sanker (05:33):
Yeah. Like a
private message or whatever.
Although, actually, now that youyou're better. Although,
actually, now that you mentionedit, many of the models offered,
what they called the girlfriendexperience, which you could
subscribe to. And that may haveincluded, like, personal
messages, like, on your cellphone.
I don't know.
Danessa Watkins (05:51):
Got it. Okay.
Jack Sanker (05:52):
Yeah. So
Danessa Watkins (05:54):
Different tiers
of subscription. Okay.
Jack Sanker (05:57):
Yeah. So I I I
we'll start with a, write up in
Law 360 where I I I first foundthis headline and then kinda
dove into the actual lawsuitafterwards. I'll quote from the
lost 360 piece here. Quote, theonline platform is known
exclusively for hosting sexuallyoriented content according to
the complaint from 5 OnlyFansusers. According to them, users
(06:19):
pay to communicate directly withmodels and others who post
content on the platform inconversations that are often
intimate and romantic.
Fans, however, are unknowinglysharing these moments with
people hired to impersonate thatcreator and convince people to
spend money spend more money onthe platform, the suit says. In
addition to the blatantdeception and fraud, the scams
(06:39):
result in massive breaches ofconfidentiality and privacy
violations, the suit says,because sensitive information
from fans, including videos andphotos, can end up in these
unauthorized hands. The modelsin chatters are connected to
management agencies operatingonly fans accounts according to
the complaint. The agencies hireveritable fleets of chatters who
(06:59):
can convince fans that they areengaged in, quote, unquote,
authentic communication with aparticular creator, it states.
And OnlyFans knows about theagencies and the chatter scams
but does nothing because ittakes a 20% cut of everything a
creator earns on the platform,the complaint claims.
Creators can share content withtheir fans through the platform,
including photos and videos, andcreators make money through
(07:22):
monthly subscriptions fees ontop of pay per view and custom
content provided at a fan'srequest. The platform also
allows fans to send tips tocreators of up to $200 per
transaction. In 2021, theplatform generated approximately
2,000,000,000 in revenueaccording to the complaint. The
promise of a personal connectionwith creators is why users flock
(07:45):
to OnlyFans according, again, tothe complaint. And the
platform's marketing highlightsthis aspect according to the
users.
The agencies for the creatorsuse the chatty impersonators to
keep subscribers engaged andlead them along into thinking
that they're having a personalrelationship with the creator,
the suit claims, adding that theagencies even provide the
impersonators with training andscripts to identify the most
(08:07):
emotionally invested targets.Agency chatters are trained to
exploit emotional connectionsusing manipulative tactics that
prey on psychological biases andvulnerabilities. The suit states
they never reveal that they arenot the actual creators,
unquote. So, this will be the2nd time we referenced the movie
Her, on the on the on the show.But I guess, like, kinda think
(08:32):
about that.
Like, you're you're paying asubscription to have a, you know
you know, contact with someone.And, and instead of it being,
like, a a friendly ScarlettJohansson, you're you're getting
someone who's just essentiallytrying to coerce you into
sending more and more money overover again through, you know, a
(08:53):
a fake relationship that's,like, both fake in the sense
that they're, an online creatorthat's, like, built this
platform to suck money out ofyou and also fake in the sense
you're not even talking to thatperson. So, that seems to be,
you know, what's happening here.And looking at the complaint in
the actual lawsuit, one thingthat jumps out is that the
(09:18):
marketing from OnlyFans, itselfit it it markets itself as
offering kind of a uniquepersonal connection between
subscribers and the creators.And it expressly lists, like,
you know, quote, direct messageswith creators as a benefit of
being a subscriber.
So it sure looks like OnlyFans,you know, OnlyFans, like,
(09:40):
corporate or whatever you wannacall it, knows about this
arrangement and is at leasttacitly fine with it. And the
complaint has a lot I mean, it'slike a 140 page complaint. It's
actually it's, quite wellresearched. It's, it's very
interesting to read. There's alot of, like,
Danessa Watkins (10:00):
information.
Say that this seems like they
they're in the know about, youknow, like, I'm kind of curious
how they got all thisinformation about, like, the
behind the scenes businessRight. Portion of this. I mean,
my first my first question washow did they find out? Like, how
did they even you know, what wasthe red flag?
(10:20):
Was it because theirconversation was different one
day to the next? And so they'relike, alright. This clearly
isn't the same person. Or
Jack Sanker (10:29):
That's a great
question. I don't know if I saw
that in the complaint. AlthoughI did I did say that they, so
the as to the attorneys whowould have drafted the complaint
here, I think that they, like,did a lot of, they did a lot of
research on this, and I found itvery interesting because they
cite to in the footnotes of thecomplaint a number of different,
like, like, podcast interviewsof, like, creators who are,
(10:52):
like, going on a podcast andbeing like, and I signed with an
agency, and they said that Icould use this whole thing. You
know, they're, like, justcopying the whole thing. Yeah.
So they, like, they they seem tohave, like, a a pretty good
sense that this is I'll put itthis way. I don't think that it
seems like it was an opensecret, and I don't think that,
(11:12):
either OnlyFans or the agenciesor the creators are going to,
like, credibly deny that thiswas happening.
Danessa Watkins (11:18):
I
Jack Sanker (11:19):
think that they're
they will likely defend the case
on, you know, something in theterms of service or whatever
that would have, you know,ostensibly allowed them to do
this. But I I think that, theydo talk about and they complain
about, like, the volume ofpeople that are chatting with
these folks and, like, I don'tknow. I've seen, like, headlines
(11:40):
on even in, like, mainstreamnews sources where it's, like,
OnlyFans creator making, youknow, $300,000 per month, and
it's, like, chatting with, like,several 1,000 people per day,
which is just not possibleunless someone else is doing it
for you. So I don't think thatthere's gonna be any credible
argument that this was nothappening. It's it's just
(12:02):
whether it's, like, legal ornot.
Danessa Watkins (12:05):
What are the
causes of action they're
bringing?
Jack Sanker (12:07):
So various
variations on fraud, fraud in
the inducement, like, justfraud, fraud, RICO, violations
of a couple of differentCalifornia, specific privacy
laws, which I don't know muchabout. But, like, as far as I
could tell, the it it I don'tthink they would be, like,
(12:31):
considered, like, the, like,revenge porn statutes, but I
think similar in that way, inthat obtaining, you know,
illicit or or nude photos ofsomeone, like, through deception
is Mhmm. Expressly illegal in inin California.
Danessa Watkins (12:49):
Yeah.
Jack Sanker (12:50):
And which is not
gonna apply it across every
state, of course, but, like, thethe larger fraud counts and the
the, alleged RICO violationswould if it's certified as a
class. And given the amount ofrevenue that is that they're
claiming is coming in toOnlyFans and any amount of
active users that it has, stufflike that, which is, like, quasi
public information, sure seemslike they're gonna have enough
(13:12):
to get certified, which is veryinteresting. And the the
complaint, you know, like Isaid, it it it says that the use
of these chat farms, is widelyknown and discussed. It does not
allege that there that there isit doesn't expressly allege that
(13:32):
these creators are using AI, butit does allude to other creators
may be using AI. And I think atthis point, they have
Danessa Watkins (13:43):
to be assume.
Yeah. I understand that.
Because, I
Jack Sanker (13:46):
mean, the the the
complaint talks about, like,
these users getting in andspending tens of 1,000 of
dollars, by the way. Like, oneone individual, I think, spent
$20,000 or something like that.But that was in, like, 2020
2020, 2022. So, like, OpenAI,ChatGPT, all that stuff is,
like, laid out in 2022 through23 and 24. So Mhmm.
(14:09):
I don't think it would have justbeen, you know, as available
during the time which thesecauses of actions accrued.
However, like, as of today, Imean, I'm sure that that that
some, you know, chat gbt rap isbeing used by someone on someone
on on the OnlyFans platform. So,just an interesting kind of,
(14:30):
like, how is that technologylike, everyone's looking for the
first use case for, for, like,chat gbt in, like, a business
setting, and it turns out it's,like, porn scams.
Danessa Watkins (14:40):
So Makes sense.
Yeah. Yeah.
Jack Sanker (14:43):
So, you know, we'll
see. The complaint also names
the talent agencies as Imentioned, that work with the
creators to kinda supply thechat farms to set this all up.
According to complaint, quote,agencies even provide chatters
with actual scripts similar tothose used by telemarketers and
call center employees which givechatters a specific workflow to
follow in order to maximize theamount of money extracted from
(15:07):
any given fan. 1 onlinecommentator described how each
chatter is given a carefullydesigned script to follow in
their messages. The script hasbeen designed just as a sales
script is to lead the fan intogetting into a quote buying mood
and to end up buying content,unquote.
A lot of the creators themselvesare advertising things like I
mentioned earlier, like, beingyour virtual girlfriend is
(15:29):
something you can buy. Alongwith, like, other I mean, it
there's obviously, like, thethe, like, lewd and, like,
expressly, like, adult content,but then there's a lot of this,
like, really sad, like,emotional stuff. Like, you can,
you know, pay for a friendonline, kind of. And I if I had
to guess, that probably bringsin as much, if not more money
(15:53):
than the, like, you know, thepornography stuff. And the
complaint also talks about thatas well, how it's, like,
emotionally manipulative, and,you know, this, like, epidemic
of loneliness, which thecomplaint cites to, some, like,
NHS statistics on that orwhatever and how this isn't
sliding right into that crackthere and and exploiting it.
(16:17):
A lot of this leads to what, youknow, looks like pretty bad
oversharing by the users, ofcourse, as you can imagine,
details about their lives,families, their jobs, and then
ultimately and that specificpart, as I mentioned, according
to the plaintiffs, opened up thedefendants to further liability
under the various Californiaprivacy laws. So, they're kind
of looking for the the reliefthat they're looking for is
typical to a class action likethis. That they're looking for
(16:44):
is typical to a class actionlike this. And it, temporary and
permanent injunction on OnlyFansfrom operating this kind of way,
punitive damages, travel damagesunder the relevant federal
statutes, attorney's fees andcosts, etcetera, etcetera. Seems
like there's enough money thatthis is, like, a significant,
like, chunk out of this company,which does a ton of revenue.
(17:07):
And, you know, it's it's justone of those, like, like, 5, 8
years ago, like, this was, like,a fictional thing. Like, this
was, like, a Black Mirrorepisode or or the movie Her or
whatever, and now it's just,like, around. So I'll be
interested to see where thelawsuit goes. I think there's
(17:28):
very little chance that it goestoo far in the discovery. And,
likely, what'll happen is, youknow, if I had to guess,
OnlyFans and the agencies end uppaying, you know, a Fats
settlement once the class iscertified.
That's usually how it goes.
Danessa Watkins (17:45):
Yeah.
Jack Sanker (17:45):
So, you know, I
don't know. It's kind of the
further monetization of, like,the influencer economy as well
as, the kind of AI hook thatwe've been alluding to and
watching to see how that showsup in actual businesses. And,
you know, sure enough, one ofthe first, you know, it it's I
(18:08):
mean, it's not like anythingelse, but it's, like, one it's
like a new technology, and we'rewe're immediately gonna run
scams on it. Yeah. So we'll keepan eye on the lawsuit, which I
think will just be interestingbecause of what it'll reveal
about the economics of thatsector, and the way in which
that technology is beingdeployed.
(18:29):
But for now, it's just it's kindof a weird and interesting case
that jumped out of the headlinesat me.
Danessa Watkins (18:35):
Yeah. And it's,
I mean, I think you're right.
It's probably not gonna go todiscovery. I think this, this
class could be potentially huge.So I'm sure the company is gonna
try to get a quick settlementin.
But, I immediately, like, put onmy defense hat here and and
(18:55):
think about I mean, I haven'tresearched this at all, but you
did mention that even thecomplaint itself references that
this is discussed widely, youknow, on on podcasts and, you
know, these influencersthemselves are kinda, like,
revealing the what's behind thecurtain and what goes on. So as
(19:17):
a defense counsel, I would startlooking into that stuff and, you
know, were you actuallydefrauded? And maybe if you
didn't have the specifics, like,let's look at everything else
that's been around for a longtime. And you should have
assumed that, you know, businesswas gonna continue in the same
way on this particularapplication. Like, I'm just
(19:39):
thinking and I know you don'tpay for Instagram, but I'm
thinking about, like,celebrities on Instagram.
You know, they've you know, yougot the little blue check next
to your name. You know, that'ssupposed to signify that you are
who you say you are. But evenstill, if you're getting a
response from,
Jack Sanker (19:54):
Kim Kardashian.
Danessa Watkins (19:55):
Right now.
Yeah. Sure. Kim Kardashian on
Instagram. Like, that's not,yeah, that's not Kim Kardashian.
And anyone that thinks thatthat's Kim Kardashian, like,
come on. Like, you can't putyour head in the sand. So I
would from if they wanted tofight this, I mean, those are
the type of arguments I wouldthink they would be fighting.
Yeah. Don't not to be crass,but, like, don't fall in love
(20:18):
with a stripper at the sametime.
You know? Like
Jack Sanker (20:21):
Classic advice.
Danessa Watkins (20:23):
And not in in
no way, shape, or form am I in
any way trying to say that, youknow, people who are on OnlyFans
are strippers or anything? Iknow that they're very different
uses for that program. I mean,
Jack Sanker (20:34):
I think it's fair
to say that most of them are,
Dinesh. I think it really is
Danessa Watkins (20:38):
that, though. I
mean, that's I I literally know
nothing about it other than whatI've seen on Instagram where,
you know, certain people willsay follow me on,
Jack Sanker (20:49):
on this That's I
just like the biggest pipeline
is, like, Instagram and TikTok.And it's, like, here's, Right.
So, I mean yeah. I I don't know.It's I guess I don't have, like,
a super coherent story to tellthe audience on this other than,
(21:10):
this just the whole influencereconomy operates in a lot of
weird kinda gray space.
It's that, like because there'snothing wrong with, like,
selling adult adult content.Like, that's, like, perfectly
legal. I mean, obviously, youknow, within the confines of,
like, all the other laws, youknow, regulating it or whatever.
(21:30):
But, like, the what they'redoing is, like, not inherently
legal. It's this idea of, how,you know, how how much of a sell
can you really do to someone?
I mean, you could spam ads atsomeone all day. That's totally
fine.
Danessa Watkins (21:45):
Mhmm.
Jack Sanker (21:46):
Personalized ads
that, you know, is buying up app
user data and is is narrowing itdown by, like, demographic and
browsing history and, you know,where you live and, the race and
gender and all those things. Imean, I it's you probably know
this, but
Danessa Watkins (21:55):
it's like a
running
Jack Sanker (21:55):
joke how, like,
Instagram knows you're pregnant
before you do, because you start100%. Yeah. You start getting
that sort of formula and stuff.
Danessa Watkins (22:06):
Right. And
Jack Sanker (22:07):
and so this is,
like, a okay. Well, like, what
if I, like, literally pretend tobe your girlfriend and, like,
tell you you're handsome and,you know, and all those things?
Like, that's it's just a one oneof those areas of, this this is
getting close to, like, pushinglimits on some levels. Maybe not
legal acceptability, but maybe,kind of social or,
Danessa Watkins (22:30):
Yeah. I I hear
you. I mean, on on the one hand,
you're paying you're alreadypaying money to even subscribe
to some of these pages, and thenthey obviously have the tiered
pricing and whatnot. So you goin knowing that something is
being sold here and, you know,you're potentially gonna get
upsell up upselled upsold on theon, you know, further things.
(22:52):
But, but, yeah, at that sametime, if the, it it kind of all
depends on how it's advertised.
If it's advertised in such a waythat you you truly do believe
you're gonna spend this money inorder to talk to this person
specifically, then I I can
Jack Sanker (23:08):
Yeah. And and and
in cross
Danessa Watkins (23:09):
the line.
Jack Sanker (23:10):
Crucially for the
law sake of the lawsuit at
least, like, the both OnlyFans,the creators, and the agencies
are taking the position that no.No. No. You are connecting
directly with the creator. Ithey're they quote a number of
number of creators in thecomplaint who, like, say things
on social media posts like, oh,I got to you know, I I'm so
happy I'm doing this.
I've got to connect with so manypeople. I have, like, met so
(23:32):
many people through thisprocess. I I I love
Danessa Watkins (23:35):
Got it.
Jack Sanker (23:35):
I love talking with
my fans, you know, stuff like
that, but it's just, like, nothappening. You know? That's
just, like, part of thedeception. And I can see, like,
it's deceiving and, you know,and maybe folks turn a blind eye
towards it because they wanna bewillfully ignorant for one
reason or another because it's,you know, it's mentally, it's
it's probably cool to think toyourself that you're talking to
(23:57):
a supermodel, and, like, you'llyou'll keep that cognitive
dissonance up so that you cankinda maintain that fantasy. But
that does seem like I don'tknow.
That just seems not great.
Danessa Watkins (24:09):
Just reminds me
of the show Catfish too.
Jack Sanker (24:12):
Yes. I mean, yes.
It's it is that. It's exactly
that. Thank you.
Yes.
Danessa Watkins (24:16):
Yeah.
Jack Sanker (24:17):
Yeah. Well, we'll
keep everyone posted on this. I
it's just an interesting one. II think, the fallout from it,
maybe it'll be just a quietsettlement that goes away or
maybe people start thinkingabout this stuff a little
differently.
Danessa Watkins (24:37):
Alright.
Starting July 1, 2024, the
Illinois Child Labor Law isrequiring that children under 16
be compensated for theirinfluencing work when they
appear in adult content. So,typically, we see children
featured in family I guess,they're calling them now vlogs.
Adult and others.
Jack Sanker (24:58):
Different than what
we just talked about. Like
Danessa Watkins (25:01):
Yes. Yes. These
are, like, more more wholesome
videos. I mean, they could beliterally videos about anything.
Cooking, cleaning, dancing,like, whatever it is.
But I I think children havebecome, like, the new puppy, a
little bit when it comes tocontent. And, you know, it it
(25:21):
brings people in, people canrelate to it. So yeah. A lot of
times and I I follow plenty ofthem on Instagram where children
are prominently featured in invideos and content. But before
this law came into place, therecertainly were no requirements
that any portion of incomederived from these type of
(25:43):
activities would be given to thekids that are featured.
And Illinois is actually from myresearch, this is the 1st state
to do something like this, toactually change its child labor
laws in this way. So thespecific code provisions that
were added are sections 2.6 and12.6, and they sections 2.6 and
12.6, and they also changed thethe definitions or they added
(26:04):
new definitions to child laborlaws. So vlog, vlog, means
content shared on an onlineplatform in exchange for
compensation. And vlogger meansan individual or family that
creates video content performedin Illinois in exchange for
(26:26):
compensation. A vlogger thoughwill not include anyone that's
under the age of 16 who produceshis or her own vlogs.
So if you're, you know, 15 andhave a webcam and you're doing
your own thing, like, you're notif you make any money, I mean,
you're obviously just gonna keepit. But say you feature your
younger sibling in your videos,this seems to indicate that you
(26:49):
don't need to share that moneywith your younger sibling. So
it'd only be if somebody wasover 18 using somebody under 16
is my understanding. So per thestatute, if a child's name,
image, or likeness appears in atleast 30% of the content, then
(27:11):
within 30 days of making incomefrom that content, the creator
must put money earned into atrust that will become available
when the child turns 18. The actdoesn't actually set a specific
number, for the amount of moneythat needs to be put in, but
it's it breaks it down based onthe percentage of the child's
(27:32):
participation.
I think it's, you know, the thetime that they're actually
featured. And there is athreshold requirement, but it's
pretty minimum, for for how muchmoney actually needs to be made
on the content before they haveto do this, but it's it's, like,
pretty low. Section 2.6. So thatthat puts forth the detailed
(27:57):
record keeping that adultbloggers must maintain when
they're publishing contentfeaturing minors under 16. And
if the records are not properlymaintained for the statute, the
minor can actually commence acivil action to enforce the
proper record keepingrequirements.
And then section 12.6 deals withthe specifics of the trust fund.
(28:20):
And notably, if a vloggerknowingly or recklessly violates
those trust requirements, theminor cannot only bring a legal
action, but if they prevail, thecourt can award actual damages,
punitive damages, costs, andattorney fees. So this is
potentially setting up kidssuing their parents.
Jack Sanker (28:42):
I mean, this this
just seems is like the updated
version of, like, do youremember, like, the, like,
nineties kids stars who, like,would go in, like, movies and TV
shows and stuff? Then you wouldalways hear stories about, like,
how they never got any of thatmoney and, like, their parents
kept that money.
Danessa Watkins (28:58):
Yeah. So it's
interesting you went went that
road. So this actually goingeven further back than that,
this law was, actually goingeven further back than that,
this law was structured, Iguess, modeled after the Coogan
Act of 1939. Jack Jackie Cooganwas a child actor who was
discovered by Charlie Chaplin,and his parents cheated him out
of money. So Coogan actuallysued his parents, and California
(29:22):
created the Coogan Act, whichrequired child performers to
receive 15% of their earningsonce they turned 18.
Obviously, that's dealing withfilm. So now we're taking it to
the social media spectrum and,which is obviously more
prevalent, and I guess probablycan lead to more, you know,
(29:42):
abuse of of not compensatingyour children or or young
vloggers.
Jack Sanker (29:48):
So I I I don't have
any, like, hard evidence on
this, but there is a particular,YouTube, kid. He's, like, 11 or
12, who has been on YouTube for,like, at least 5 years that I
know of, who makes many, many,many 1,000,000 of dollars doing
toy reviews. And, like
Danessa Watkins (30:08):
Oh, yeah. Like
look at that.
Jack Sanker (30:10):
Like, 20 to
$30,000,000 a year doing toy
reviews. And I don't know muchabout it. I have kids, but my
sister has kids and hers herkids are older than mine. And I
remember asking her at onepoint, hey. Have you ever heard
of this kid?
Do they, like do you guys everwatch this stuff? And she's,
like, no. We don't we don'twatch that because his, his his
parents are ripping him off orsomething. It's, like, the story
(30:31):
that I heard from my sister. So,like, I don't know if that's
true or not.
That's why I didn't say hisname. But but, like, that you
could see how, like, appealingthat would be to, like, a
certain type of parent who'sgonna, like, put their kid on,
like, TikTok or YouTube orwhatever. And I think it's
interesting because, like, ourage demo, you know, like,
(30:52):
thirties, millennials, like,we're all, like, aging into,
like, kids, having kids. Mhmm.And so, you know, we're all,
like, consuming, like, kidscontent.
You know, like, I I really likeyou know, if I see, like, a
parent and their kid, like,doing, like, a cute dance on
Instagram or whatever, like,that you know, I I like that.
Right?
Danessa Watkins (31:10):
Yeah.
Jack Sanker (31:12):
So, like, there's,
like, a all of a sudden, like, a
mass appeal for this. So you Ibet people are like For sure.
Oh, we can get famous by, like,putting my, you know, 6 year old
on these videos or whatever, andthen the kid gets
Danessa Watkins (31:21):
nothing. Yeah.
I mean, no doubt. This this
legislation is trying to protectkids from exploitation, and it's
actually kind of interesting. Ilooked a little bit more into
how this came to be.
It was a school project by ateenager who just started
investigating the lack ofprotection for child
influencers, and then she sharedresearch and findings with the
(31:45):
state senator. And he he pushedthe the legislation. So, yeah,
it's it's kind of just brings aninteresting discussion about
who's the moneymaker of ahousehold when you have, you
know, maybe the the parents areare doing the postproduction and
coming up with the ideas. But,you know, if if your followers
(32:08):
and any income you derive I wish
Jack Sanker (32:09):
I wish my 2 year
old would get a job.
Danessa Watkins (32:12):
Seriously.
Yeah. So I I'm sure it's not
gonna be the 1st state to do it.I I mean, it is the 1st state to
do. I'm sure it's not gonna bethe last state to do it.
And I can't imagine too muchpushback coming from it. I
guess, at least not until kidsstart suing their parents and
(32:33):
then, you
Jack Sanker (32:33):
know Right.
Danessa Watkins (32:34):
What happens
with that. But On
Jack Sanker (32:36):
one hand, you could
see how it could be framed as a
way to, like, drive a wedgebetween, like, parents and their
children or whatever. I don'tknow. It's I I can only see it
ever being an like, I can onlyever see it being used in a
handful of cases where there'sso much money available that
both sides are able to, like,lawyer up and do this. So, like,
it would have to be, like, amega rich YouTuber who got
(32:59):
absolutely scammed out of tensof 1,000,000 of dollars by his
parents. You know?
That's the only way, like, youwould actually probably see this
getting forced. Like, I doubtit's gonna be, you know, some
kid with, like, an Etsy shop,like, suing
Danessa Watkins (33:11):
his
Jack Sanker (33:11):
parents for, like,
300 bucks. You know?
Danessa Watkins (33:14):
Yeah. You're
probably right. But either way,
I mean, good on Illinois forbeing a front runner and
protecting kids. So
Jack Sanker (33:23):
Yeah. More more
influencer economy news. It's
always, believe it or not, it's,I think, it's a huge sector of
the US economy.
Danessa Watkins (33:36):
I don't know
where I pulled this from, but it
said that, essentially, this actcomes from a slowed acceptance
of influencing as a real careernow that we've seen child
influencers earn up to $20,000per post.
Jack Sanker (33:53):
Alright. We got
some of that.
Danessa Watkins (33:56):
Yeah. Come on,
kids. Line up. Alright. Next up,
we have Rupert Murdoch who isthe 93 year old media mogul who
is an executive of FoxCorporation, News Corp, Wall
(34:17):
Street Journal, HarperCollins,and the New York Post to name a
few.
There is a family feud amongRupert and his 4 eldest children
that's been secretly takingplace in Nevada's probate court.
This just came to light lastweek after the New York Times
obtained a sealed court documentthat shed light on the conflict.
(34:39):
So right now, the trust isarranged for Rupert's 4 eldest
children to share equal control,so equal voice and through their
equal voting rights of of thefamily companies in the event of
Rupert's death, which again,he's 93. So, he's trying to
button things up now. But Rupertwants to change the trust to
(35:00):
give his son, Lachlan, majoritycontrol over the family empire.
Jack Sanker (35:04):
Oh my god.
Danessa Watkins (35:04):
This is
Jack Sanker (35:05):
this is literally
season 4 of succession, but
Danessa Watkins (35:07):
okay.
Jack Sanker (35:07):
Go ahead.
Danessa Watkins (35:08):
Okay. So I have
to admit, I have not ever seen
succession. Mhmm. But, but yeah.I my understanding is that I
don't know if it's true or not,but that's the rumor that it is
loosely based off of the Murdockfamily.
Jack Sanker (35:22):
So pretty tightly
based off the Murdock family, to
be honest.
Danessa Watkins (35:24):
I think even
the writers
Jack Sanker (35:25):
have, like, more or
less said so.
Danessa Watkins (35:27):
Oh, okay. Well,
then hit it on the nose. So 3 of
his children, James, Elizabeth,and Prudence, they are all
taking issue with this latestchange. James, in particular, is
the one that's been the mostvocal about his his feelings
that Fox News has poisoned thereputation of the whole
business, and he essentiallyjust wants to rid it from, you
(35:50):
know, from their docket, Iguess, so to speak, which I I
will say. I mean, Fox News wouldsell for, you know, a hefty
price if if it really was ofconcern.
But, either way, that's notwithin Rupert's vision, and I
guess his son, Lachlan, is is onhis side as far as keeping
(36:10):
everything together. The soRupert agrees more generally
with Lachlan's conservativeideologies than his other
children's and his otherchildren's opinions and beliefs.
But I thought it was kind ofinteresting when you look at the
the list that's, you know, partof this news empire, you really
(36:33):
have, like, a cohabitation ofjournalistic extremes. I mean,
Wall Street Journal on one endand then Fox News on the other,
which interestingly, I guess,they I think they, yeah, they
operate out of the same tower inNew York. So, I mean, on one
hand, Rupert just seems to belike any other businessman
diversifying his portfolio.
(36:56):
And Lachlan shares that vision,but I guess James is more
concerned about how, like, itseems like Fox News in
particular, how that reflects onhis family. Now the only way
that they can change thisirrevocable trust that's set up
is for Rupert to prove to thecourt that the amendments he
(37:16):
wants to make to the trust wouldbe in good faith and for the
sole purpose of benefiting itsmembers. So essentially, that
moving away from these moreconservative focus news media
agencies that it would, cause,you know, the success to
(37:37):
decline, and it wouldn't benefitthe trust. Perhaps worth noting
here, as of 2023, Rupert Murdochhad an estimated personal net
worth of 8,700,000,000 accordingto Bloomberg, and Forbes puts
his family's total net worth at18,000,000,000. There's a lot of
(37:59):
money at stake here.
But to be clear, he's not sohe's not changing how, like, the
finances or the economic stakesin these companies are divided.
I guess he has 6 children intotal, and it's set up so that
all will get equaldisbursements. He's more focused
on the control. Right now, his 4eldest are supposed to be
(38:21):
sharing in the control, and he'strying to change that to just
put one at at the head.
Jack Sanker (38:27):
So it seems like
James is Kendall. Lachlan is
Roman. And I don't know who'sConnor and Shiv yet, but, you
know, maybe by the end of this.
Danessa Watkins (38:37):
May yeah.
Alright. You're gonna have to
rely on our listeners to toweigh in on that. It's, like, my
Jack Sanker (38:42):
second favorite
show of all time. So
Danessa Watkins (38:44):
Alright. I
gotta make room for it. I'm I'm,
like, just watching now, BetterCall Saul. Like, I'm so behind.
And I just finished Your Honor,so I'll get to this one
eventually.
But, yeah. So I mean, this isall just I I guess it's been
brewing for a while. We justdidn't know about it. It's
(39:05):
finally coming out. So the I getit.
Jack Sanker (39:08):
The changing of the
trust, the the demonstration, I
guess, by whatever standard ofproof is, like, is in the
documents. I don't I don'tactually don't know much about
this. But, so it has to be shownto be be done in the best
interest of all thebeneficiaries of the trust. So
it's, like, actually a questionof what the motives are behind
(39:31):
altering the relationship withFox or not.
Danessa Watkins (39:35):
That seems to
be it. Yeah. And, I mean, like I
said, you know, the newsorganizations that he across the
board as far as ideologies and,you know, where they lean
politically and whatnot. So hemay have a good point that he's
just trying to to, you know,hold on to this diversified, you
(39:58):
know, news mogul. And he has oneson who wants to, I guess, kick
out the the more conservativeones, and one that wants to
just, you know, keep everythingas is.
Jack Sanker (40:13):
There's a lot of
gossip around the settlement for
the Dominion Voting Machineslawsuit, which we did cover on
an episode, I believe, which issome huge amount of money. I
don't recall what it was. Iremember it being a lot. And
then there was a lot ofspeculation that part of the
deal was also that they had tofire Tucker Carlson.
Danessa Watkins (40:33):
Right.
Jack Sanker (40:33):
And that was, like,
speculative, like and I don't,
to my knowledge, know it as itconfirmed that or or or fully
denied it. And, and there was,like, just a lot of, like,
messy, like, gossip piecesabout, you know, the the
Murdochs being furious with theFox folks for, like, getting
them into this trouble in thefirst place and and all of that.
(40:54):
So there's probably some levelof animosity between, between
Rupert and, like, Fox, like,broadly for, you know, costing
him probably a couple100,000,000 at some point
Danessa Watkins (41:05):
Mhmm.
Jack Sanker (41:06):
During that during
that lawsuit. So it it may it
may be, you know, financiallymotivated as you mentioned, but
it it could also just be, like,you know what? I hate these
folks. I wanna get out.
Danessa Watkins (41:18):
Well, that
could be a good argument for
James in in defending why theyneed all 4 kids to remain, you
know, have equal voting rightsbecause, yeah, there has been a
lot of uproar recently caused byFox News, and it has cost them a
lot of money. So maybe, youknow, it makes sense to have 4
(41:38):
people weigh in on that.Although, I, in no way, shape,
or form, envy that. I mean,we've we've seen this forever
though. This is what happenswith family businesses.
You hand them down and kids havediffering views on on how to
continue things. So it's, youknow, the classic case of
billionaire generational wealth,I guess.
Jack Sanker (41:57):
Yeah. Yeah. Yeah.
Yeah. No.
I mean, it'll, it it's, I Idon't wanna keep talking about
Succession, but it's that thatshow really seemed to hit the
nail on the head for how thatdynamic works, like, to the
point where, again, this was,like, this is just this was,
like, me this was, like, thetype of gossip rag that I read
(42:17):
was, like, the, folks in thefamily were, like, stop talking
to the writers of the show. God.Like, stop talent. Like, because
there would, like, be innuendosand, like, actual specific
instances of, like, familyinteractions, like, written into
the show so perfectly, they'relike, oh my god. Which of you is
talking to HBO?
Like, please stop.
Danessa Watkins (42:38):
Oh, like, in
real in real life, the Murdoch
Jack Sanker (42:40):
family was Like
like, actually, there'd be,
like, this like, there'sthere's, like, you know, like,
the conversation that happenedthat's, like, actually happened
among the Murdochs that wasportrayed on the show. And
they're, like, this is alright.Like, you have to stop leaking
this stuff to the stupid writersof Succession, please. So, yeah.
I mean, it's an it's a I it'llbe interesting to see what the,
(43:04):
how it gets resolved.
I mean, as I understand it,typically, it'll be resolved by
some type of, like, negotiationamong the various stakeholders.
So, like, the 4 kids will haveto figure out how they wanna
handle it along with Rupert, youknow, so long as he's still in
the picture that is. But, youknow, otherwise, it's like this
is the type of thing that's,like, years years of litigation,
like, a decade of litigation, ifif it if push comes to shove.
Danessa Watkins (43:28):
Yeah. I mean, I
don't and and I know you don't
either. We don't work in probatecourt, so I don't know how that
stuff, you know, generally goes.But, but it seems like at some
point, yeah, a judge is gonnahave to make a decision on
whether they can change theterms of this irrevocable trust,
which we do know, you know, fromour limited preparation for the
bar exam. Irrevocable doesn'tmean you're revocable.
(43:50):
Right. But but, yeah, there'sthey're gonna have to meet some
sort of a threshold before theycan change how things have been
laid out. So, yeah, I guesswe'll see. But I I think it'll
be more interesting to see themedia that happens after this,
you know, now that cat's out ofthe bag and I don't know. Maybe
it'll affect stocks in a waythat makes it, you know, to
(44:12):
their benefit to to unload FoxNews.
Who knows?
Jack Sanker (44:16):
Possible. Yeah. I
mean, I I think, you know, some
people will view it as Rupert isthe secret sauce that, you know,
has made Fox News and variousother media conglomerates what
they are. And, you know,removing him from the equation,
it makes them just like anythingelse. And, like, TV as a
industry itself, like, TV newsas an industry itself is a bit
antiquated.
(44:37):
So, you know, can they pivot tosomething, you know, more online
or whatever it is? So yeah. I Idon't know. It'd be interesting.
They they they could, you know,yeah.
They could buy Valtter and haveto shut it down after 1 season,
because it wasn't profitablewhen Lea went off like they did
in concession. So
Danessa Watkins (44:56):
I would say
that all just went over my head.
Jack Sanker (44:57):
So Yeah. I know.
Alright.
Danessa Watkins (44:59):
Enough of that.
Jack Sanker (45:04):
Alrighty. Well,
that's the show. Thanks for
listening. As always, you canfind us on Apple Podcasts,
YouTube, Spotify, wherever youget your podcasts every other
Tuesday. And followed up, we'lltalk to you in 2 weeks.