They’re among the coolest cats at the bar, but they ‘re never stalked by the paparazzi. Not even their clients are stalked by the paparazzi. Hardly ever, anyway; that’s the advantage (or is it disadvantage?) of being a Canadian star. Still, the handful of entertainment lawyers who service the Canadian entertainment scene aren’t complaining. M&A dealmakers may be the pop stars of the bar- -especially in a year like 2006–but entertainment lawyers get to rub elbows with real stars.

And, in the case of the entertainment lawyers at Toronto’s Goodmans LLP, the aspiring pop stars of Canadian Idol.

Granted, most of the work is more legal than entertaining.

“Day to day we are involved in all manner of entertainment industry work, such as development, financing, production, and distribution of film and television shows, the buying and selling of film companies,” says David Zitzerman, one of the six (or dozen- -if you count the CRTC dudes) lawyers within Goodmans’ entertainment and media law practice group. (The CRTC group deals with, obviously, CRTC issues, including the buying and selling of regulated assets.)

Entertainment has been part of the platform at Goodmans almost from the inception of the firm by virtue of the interest and practice of one of its founding partners. Now, Goodmans is, above all, a heavy-hitting business law firm — an obscene profitable one, even by the most avaricious Bay Street standards, to boot. So how does an entertainment law practice fit into a platform dominated by corporate Philistines?

Just fine. So long as it brings in the cash.

“The good news is we’re a profitable group,” says Zitzerman. “We encounter good-natured ribbing from the corporate lawyers who are doing the ‘real’ work. But we are able to say, hey, we’re profitable. Our best defence is to make a lot of money and say, we make a lot of money so what’s your point.”

He makes it sound easy. But making Bay Street-level gobs of cash off a frequently embattled and usually impoverished industry can be a challenge. Hence the proliferation of entertainment law boutiques, from one to two person shops that specialize in representing individual performers or actors, to the heftier seven-person Stohn Hay Cafazzo Dembroski Richmond, one of Toronto’s premiere entertainment and copyright law boutiques.

Most of Stohn Hay’s lawyers hail from major firms that could not comfortably support the type of work that’s the bread and butter of a Canadian entertainment law practice.

“We have more flexibility in terms of rates,” says Diana Cafazzo, widely recognized as one of Toronto’s leading entertainment lawyers.

She spent the bulk of her career at McMillan Binch before becoming one of the name partners of Stohn Hay. “Like all boutiques, we have less overhead, so we can charge less. We can also do flat fees and other alternative arrangements. We were able to do some of that at McBinch” — which, Cafazzo notes, remains a firm with strong capability in the area–“but it is much easier in this environment. We look at each other, and say, is this what we want to do.”

Navin Khanna, now a partner with business law boutique Chitiz Pathak, ran into a similar problem at McCarthy Tetrault.

“There is almost always room at a large firm for someone who understands the entertainment industry, copyright law, privacy issues and so on,” he says. “But this practice does not equate with getting the billables. It is hard to get 1800 billable hours, at big firm rates, from entertainment clients. Most of them can’t afford your $600 an hour.”

And a pattern emerges: lawyers getting a taste of an entertainment law practice at a Mc- Binch or McCarthys, then taking that expertise to form a Stohn Hay or Hall Webber, another of Toronto’s well-esteemed entertainment law boutiques.

To date, that has suited the major firms just fine. But then, most of them didn’t blink when their intellectual property or technology people walked out either. Khanna believes a similar scenario is about to play out in entertainment law, because the industry — and the type of services it needs –is changing exponentially.

“The merger of technology and content we are seeing is changing the definition of the industry, who your clients will be and what they will want you to do,” he says. “It will be difficult to service that convergence at the bigger firms for the simple reason that the major firms service the big players in the industry. And both the big players and the big law firms tend to be risk averse. The next big thing in this industry is going to be created by mavericks More than half of what your really creative clients want to do is probably legal, but it will cause them problems. We see more and more clients in this area who are entrepreneurial, realize what the risks are, but want to do it anyway and sort out the problems later.” Those clients, argues Khanna, are taking entertainment law to a new level.

Norman Bacal agrees. He’s the national co-managing partner of Heenan Blaikie LLP, tax partner, and de facto founder of Heenan’s entertainment practice. The firm’s national entertainment practice, intimately intertwined with the firm’s tax expertise, has been anticipating the current convergence for a decade.

“The industry has changed so dramatically in the last 10 years with the interlinking of content and physical machinery,” says Bacal. “As an industry and as professionals who service this industry, we are in flux. We saw this coming six or seven years ago, maybe even 10 years ago you have to run pretty hard to stay ahead of the curve in this area.”

And frankly, there aren’t that many participants in the race, because the future belongs to those practitioners and law firms who are able to do sophisticated, cutting-edge work for itty bitty clients: in other words, multidisciplinary law firms with the flexibility or entrepreneurial thrust of boutiques, or hefty boutiques that can take their clients to the next level.

“The heart of the future of the practice is in the small and medium- sized companies that will be the big companies of the future,” says Bacal. “We’re in an industry where the next big thing will come from someone running a very small business with a very big idea.”

(Copyright National Post 2006)