The following is an excerpt from Practice Perspectives: Vault's Guide to Legal Practice Areas.
Tracy Smith represents entertainment companies and sources of capital in M&A, private equity, and commercial transactions, and advises entertainment companies on general corporate matters. Tracy rejoined the firm following a judicial clerkship for Judge André Birotte, Jr. of the U.S. District Court for the Central District of California. While in law school, Tracy was the lead articles editor of the Pepperdine Law Review. She also served as a judicial extern for the Honorable Beverly Reid O’Connell of the U.S. District Court for the Central District of California and the Honorable Sandra Segal Ikuta of the U.S. Court of Appeals for the Ninth Circuit. Prior to law school, Tracy worked in business and legal affairs at a film production company in Los Angeles.
Luisa Lizoain counsels public and private companies and investors on corporate matters, including M&A, dispositions, co-investments, and joint ventures, with a focus on sports, entertainment, and media. Her practice includes the representation of individuals, groups, and private equity firms on investments in, and acquisitions of, major professional sports teams and expansion teams. She also represents professional sports teams in connection with day-to-day operations, equity financings, sponsorship deals, licensing deals, stadium deals, and other commercial matters.
Describe your practice area and what it entails.
Luisa: I work in Sidley’s Entertainment, Sports and Media Group, focusing primarily on sports-related matters. In general, I do a lot of M&A-type work in the sports industry, with an emphasis on representing clients who want to invest in or acquire professional sports teams. Each league has a specific set of rules, so a large part of my practice involves helping clients navigate league rules and transaction approvals.
Tracy: I also am a member of Sidley’s Entertainment, Sports and Media Group and have particular experience in entertainment matters. I focus on strategic and private equity transactions, helping production companies, studios, and other sources of capital with M&A, joint ventures, and other commercial transactions within the entertainment and media space. Like the sports teams Luisa works with, the entertainment world has its own set of rules and languages, so my practice involves assisting clients with all of the unique issues that arise in entertainment-related transactions.
What types of clients do you represent?
Tracy: I have represented studios, production companies, private equity funds, and other entertainment entities like Artists Equity, The Gersh Agency, Neon Rated, The Raine Group, Team Coco, Trending, Warner Music Group, and Universal Music Group, plus entertainment-related founders, producers, and other individuals, such as Ben Affleck, Mark Burnett, Alex Cooper, Matt Damon, Dany Garcia, Eli Holzman, Dwayne Johnson, Matt Kaplan, Conan O’Brien, and Craig Piligian.
Luisa: My clients include a mix of private equity funds (Arctos Sports Partners and Monarch Collective) and individuals (Mitch Rales and Magic Johnson) who are investing in professional sports teams. I also do work for teams themselves, like Angel City FC—Los Angeles’ professional women’s soccer team.
What types of cases/deals do you work on?
Tracy: I handle strategic transactions between production companies/studios as well as private equity deals. Most recently, we represented Ben Affleck and Matt Damon in launching the production company Artists Equity with a minimum $100 million investment from private equity firm RedBird Capital Partners. Before that, we represented Conan O’Brien in the sale of Team Coco, his podcast network and digital media business, to SiriusXM.
Luisa: Many of my deals involve acquiring a minority interest in professional sports teams and, sometimes, control of a team. We help clients understand the team’s existing governance structure and their obligations as team owners. We also help clients negotiate for certain rights as team owners, including ownership perks. Since team valuations have been dramatically increasing over the past few years, we often work with clients who are looking to put together an investor group to acquire an interest in a team (or the team itself).
How did you choose this practice area?
Tracy: I have been in the entertainment world all my life, having grown up acting, dancing, and singing. I moved to Los Angeles to become an actor but soon realized I was more interested in the business and legal side of the industry. Having this background helps me connect with clients and understand their legal issues from a more empathetic viewpoint. It also makes my day to day more fun, as I am completely immersed in a world that I am passionate about.
Luisa: I have been interested in the entertainment, sports, and media industry since law school, and started out doing general corporate work and M&A, which helped me build the foundational skills I use now. I had the chance to start working on sports matters early on and really enjoyed the experience. Every deal is different, which keeps things interesting.
What is a typical day like and/or what are some common tasks you perform?
Tracy: When deals are active (and they typically are), I am usually reviewing or drafting deal documents, such as joint venture agreements, purchase agreements, governance documents, and/or employment agreements, and coordinating with the corporate team, the client, and the client’s other advisers (investment bankers, accountants, managers, and business managers) regarding the same. As Luisa notes, deals in this space are fun and collaborative, where client and co-adviser input is crucial.
Luisa: It really varies depending on the deals that I’m working on. I might be reviewing sponsorship or ticketing agreements for a team or reviewing a team’s governing documents for a potential investor. Our deals are often very collaborative, so we spend a lot of time communicating with clients and counsel for our counterparties and the leagues.
What training, classes, experience, or skills development would you recommend to someone who wishes to enter your practice area?
Tracy: I always recommend finding a legal internship in the entertainment space, whether at a production company, studio, or otherwise. My time working at a production company before law school solidified my desire to enter my practice area and provided me with the foundational skills I use every day at the firm. An internship will also provide opportunities to meet people in the industry, which is key to one’s career and overall business development.
Luisa: I have found the on-the-job training most helpful, especially observing partners and more senior lawyers and how they approach each deal. It is also useful to expand your commercial awareness by reading industry news and staying on top of the latest developments.
What do you like best about your practice area?
Luisa: Every deal is different, so I am always learning something new and interesting and building different skill sets. Clients are also really excited to be investing in teams—sometimes they’re lifelong fans of a team and are realizing their dream of becoming an owner—which is rewarding for me when I can help them navigate that process. It’s also fun to see the deals I work on in the news.
Tracy: Like Luisa said, working with the clients is the best part. When they come to us, it is usually because they are excited to grow within their current business or build a brand new business venture. They are passionate and energetic about the deals, as the deals give them greater opportunities to make content, provide capital to other companies, and generally expand within the entertainment field. It is always a fun adventure.
What misconceptions exist about your practice area?
Luisa: That you need to be a die-hard sports fan. It can help serve as an entry point to sports work, but is by no means necessary. We’re always happy to work with people who are eager to learn.
Tracy: That there is a separate “entertainment law” that we practice. While we work with entertainment entities, assets, and individuals, we are still practicing corporate law and conducting M&A deals in the same way our non-entertainment colleagues do. That said, there are nuances to ESM deals that require a level of expertise and deal fluidity that sets us apart and makes those who meaningfully practice in the space a team unto themselves. Plus, deals involving entertainment entities, assets, and individuals are just more exciting to work on (no disrespect to other sectors intended).
What are some typical tasks that a junior lawyer would perform in this practice area?
Luisa: It runs the gamut. On some deals, there’s a bigger focus on diligence, which allows junior associates to “get into the weeds” on the team’s key agreements and operations. Other times, there is more of a focus on reviewing and understanding governance documents. Junior associates also help revise transaction documents and draft ancillary documents.
Tracy: Luisa is exactly right. Additionally, junior associates can undertake whatever tasks they feel most comfortable in performing. When I had to be out unexpectedly, a first-year associate stepped in to close the deal by herself (with partner assistance, of course). She now has the confidence to take on bigger tasks well beyond her level, and we are happy to provide those opportunities.
What kinds of experience can summer associates gain at this practice area at your firm?
Luisa: Summer associates work closely with associates and partners on active sports matters. We try to integrate summer associates on the deal teams so they are doing real work and getting exposed to the types of documents we draft and review. Summer associates also shadow client calls and participate in deal team meetings to give them exposure to all aspects of a given deal.
Tracy: Summer associates are given responsibilities comparable to those of real junior associates. Whether they are drafting disclosure schedules or ancillary documents, or assisting with a closing, summer associates always get practical, hands-on experience—including opportunities for direct interaction with clients. Our summer associates are deal team members like everyone else, with the same level of responsibility—and expectations.