Labor Commissioner ordered to immediately issue a license to Direct Models.
Premier adult industry talent agency Direct Models it pleased to announce that it has prevailed in its preliminary legal battle with the California Labor Commissioner, and won back its licensure in the state.
The stinging 15-page decision found that the Labor Commissioner abused her discretion when the Division of Labor Standards Enforcement made the sudden move not to issue Direct Models another license effective April 1, 2021.
A licensed talent agency in California since 2005, Direct Models applied for a renewal of its license in August 2018 and the Division of Labor Standards Enforcement issued a provisional license, while investigating the application.
Subsequently, the DLSE filed a Statement of Issues against Direct Models, instigated by attorney Allan Gelbard — best known as the bus driver in the “Shane’s World” adult video series. The DLSE continued to issue successive provisional licenses — maintaining Direct Models’ licensed status — until the hearing it initiated could be completed.
Then, in April 2021, after nearly 30 months of provisional licenses, the DLSE abruptly and capriciously reversed course. Although there were no changes in the licensing process, circumstances, or situation, and although the hearing guaranteed Direct Models was still months away, DLSE arbitrarily refused to issue another provisional license. That action constituted an an improper de facto suspension of Direct Models’ Talent Agent License. It effectively terminated then agency’s license for at least six months, and denied it the right to continue conducting business as a talent agency, all without any showing or adjudication of wrongdoing or unsuitability for licensure.
Direct Models filed for a Writ of Mandate in Los Angeles County Superior Court, and a July 12, 2021 date before Judge Howard W. Cohen of the Office of Administrative Hearings was set.
The Labor Commissioner was represented at the OAH hearing by Barton Jacka, an attorney with the Division of Labor Standards Enforcement, who mentioned on the record that it was he who made the decision stop issuing licenses to Direct Models in April 2021.
Originally scheduled for a number of days, the hearing lasted only a few hours after Jacka was unable or unwilling to present any evidence to demonstrate what facts the DLSE, an office of the government of the State of California, considered when it exercised its discretion not to issue another provisional license.
Having refused to offer such evidence, Jacka failed to establish a factual basis for the Commissioner to have denied Direct Models an additional provisional license in April 2021.
Jacka instead relied on a novel argument: that his own office had been violating California law by exceeding its statutory authority for nearly two years by issuing successive provisional licenses to Direct Models.
Having informed the court that the DLSE finally understood the law which was its job to enforce, Jacka essentially argued that same office should be trusted and supported in its new interpretation of California law.
The court instead found Direct Models’ legal argument persuasive:
“Issuing a provisional license is discretionary during a pending new license or renewal application process. But where the Commissioner, rather than issue a renewed license, invokes the administrative hearing process by filing a Statement of Issues, it cannot, unless evidence establishes cause, deprive a licensee of continued licensure merely by refusing a “bridge” license, i.e., a provisional license or a series of provisional licenses, to the licensee before the Statement of Issues is heard and a decision issues. Any other ruling would render the requirements of [California law] meaningless and would vitiate Legislative intent.”
“Because the Commissioner offered no evidence to dispute that she issued sequential provisional licenses over the course of two years, and no evidence to show the Commissioner considered facts that would cause her to alter this pattern, there is no basis to support a finding that the Commissioner’s denial of respondent’s application for a further provisional license was not an abuse of discretion,” Judge Cohen found.
“The Commissioner shall immediately issue to respondent a provisional 90-day talent agency license, to be effective on the date issued,” the court ordered.
“Although the Commissioner’s exercise of discretion may be broader in granting or denying a provisional license than it is in granting or denying a license
renewal, that discretion may still be abused. Issued without any factual basis, and while a Statement of Issues is pending a hearing that will, presumably, yield substantive findings in support of a decision, the Commissioner’s denial without supporting evidence of a provisional license or a series of provisional licenses extending until a decision on the Statement of Issues case issues is and will continue to be an abuse of discretion,” the judge warned.
Direct Models’ attorney Richard Freeman commented on the court’s decision:
“We are extremely pleased that the erudite Administrative Law Judge recognized that the Labor Commissioner acted arbitrarily and capriciously in April 2021 when she refused to issue a continuing (the 21st) Provisional License while the administrative process that the Labor Commissioner herself had initiated was pending. We appreciate that the ALJ saw the actions of the Labor Commissioner as a clear abuse of her discretion.
“It is indeed gratifying that the Labor Commissioner has been ordered to issue a further license to Direct Models as it combats her efforts to revoke its permanent license. We feel this is a positive sign of the good things to come for the agency as well as anyone doing business in California.”
Judge Cohen’s decision may be downloaded here: https://www.dropbox.com/s/f16bstwyl657t10/OAH%20Direct%20Models%20Decision.pdf?dl=0
Adult News
April 23, 2024
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