By Daijha Morrow
Kevin Masuda is a partner in the Los Angeles office of Gibson, Dunn & Crutcher and is co-chair of the firm’s Media, Entertainment and Technology Practice Group and its Betting and Gaming Practice Group. He regularly represents content companies, including motion picture studios and music companies, technology companies, gaming companies, private equity funds, sports and talent agencies, and other clients in various types of business transactions, including mergers and acquisitions, joint ventures, investments, restructurings, licensing agreements, sponsorships, and other strategic agreements.
Daijha Morrow sat down with Mr. Masuda to discuss his background, legal journey, and advice for current law students.
The Beginning of his Career
Daijha Morrow: It’s a pleasure to have you here today! One of my goals through the Harvard Journal of Sports and Entertainment Law is to allow people interested in entertainment law to get a deeper sense of what the work looks like practice. This interview consists of a few questions that I wanted to ask to gain that insight. Does that sound good to you?
Kevin Masuda: Sounds great!
Morrow: Perfect! The first question is how did you begin working in entertainment law? Was this something that you knew that you wanted to do straight out of law school?
Masuda: Not at all. I studied Economics as an undergrad so I was always interested in business – how business works and how people make money. Originally, I leaned towards corporate law. However, I did not have any lawyers in my family so I didn’t truly know what a corporate lawyer did.
So, I tried various areas in corporate law. I first worked in high-yield debt and then kind of happened into the field of sports and entertainment law.
I’ve always been a huge sports fan. I’m a diehard fan of the LA Lakers and the LA Dodgers. I told people that I was really interested in sports and so I started to work doing mergers and acquisitions (“M&A”) and strategic transactions in sports. Then, as I got more opportunities, some of the cash/sweat structures for my sports deals also worked well in entertainment, especially music as the 360 deals with artists became the new thing. And that’s how I started to dip my toe in entertainment. It was really just luck and following opportunities.
Morrow: That’s awesome! Having studied Economics in undergrad, did you take a gap year between law school to work in business or did you go straight through?
Masuda: No, I didn’t take a gap year. I went straight through. Back in my day (I graduated law school a little more than 30 years ago), I think that a higher percentage of people did go straight through. During college, I worked some summers at law firms, including this law firm [Gibson Dunn], to get a sense of how law firms work. I also wanted to understand the Big Law business model because really, nobody in my family has done this.
So, I was pretty focused and that’s how I learned about the business of law as opposed to the image of the trial lawyer as is often represented on television.
Morrow: That makes total sense. Do you think being interested in business led you more towards transactional work? Did you ever experiment with litigation?
Masuda: I tried litigation during my 1L summer when I was at another large law firm.
At larger firms, the nature of the litigation process is a lot longer. So, lawyers are working on cases for many years. There’s a lot of research and a lot of preparation. It’s a bit more reactive. That said, I know that it can be interesting and really strategic/creative.
The longer term nature of litigation, however, didn’t appeal to me as much. Doing some corporate projects, you can be a bit more proactive, rather than reactive, especially in M&A which is what I do.
You can look at questions such as why are these two companies merging? Why is the target that is being sold going to be more valuable in the buyer’s hands? Why does this transaction make sense? It’s that proactive nature of thinking about business that I find really appealing and challenging.
I also enjoy doing mergers in different industries, whether it’s a human services industry, or a manufacturer, or a branding company. Thinking about how that company makes money and where is the best place for that company to be is challenging. I’m learning every day and that’s what I like most about doing mergers and acquisitions.
On his Favorite Projects
Morrow: Thank you so much for sharing that. I saw that you have done a lot of really big deals in different industries and companies. For example, I saw that you completed a deal with Lebron James’s company. To that point, I wanted to ask you what has been your favorite project to work on?
Masuda: That’s hard to say. There’s been so many interesting deals in different parts of my career. But, I think what I like about entertainment is that it is constantly evolving, and people always want to consume content. However, people consume content in different ways. You’re a lot younger than I am, so you consume content one way, like my children. My wife and I, who are older, and your parents probably, consume content a little differently. So companies are always trying to adapt to match consumer consumption preferences.
I enjoyed representing Beats by Dre. That initiated a new era and a brand new market for headphones — where people who previously didn’t spend $300+ on headphones now were. It was partially a branding deal, partially a technology deal. And everything came together perfectly for this company to grow exponentially. For instance, Apple iPhone connections changed to the Lightning jack (so consumers were ready to replace their plug-in speakers) and Bluetooth became a standard. It was amazing to watch a nascent idea like that develop. I saw Beats by Dre go from eight employees to 600 employees and sold within three years. It was a great ride
But I still enjoy working with SpringHill Entertainment, which is Lebron James’s production company. With streaming content being more prevalent and content providers no longer locked into linear television content, to see what they’ve been able to do to attract eyeballs is amazing. And every year, we see further shifts, whether as a result of the pandemic, a writers’ strike, technology change, or natural evolution. Things happen in the industry, and people still want to consume content so there are shifts. And that’s what I find fun.
On Entertainment Law
Morrow: That does sound really fun to keep up with! A lot has definitely changed, even in this lifetime!
I have another question that I would like to ask you. What would you say differentiates entertainment work from other types of M&A work?
Masuda: Given the nature of entertainment content and big names, you’re always coming across issues that are a little bit different, whether they’re related to branding or technology. I do think that the core is “content is king”. That is – driving eyeballs is important because that’s what makes money. But you need to figure out how to distribute that content and how to popularize that content and that’s what’s always constantly shifting. In a sense, I think it’s similar to other industries in that you’re selling a product or a service, but it is a different type of product and service, and generations consume it so differently. I think that’s what differentiates it.
For example, live sports is a type of entertainment content, but it’s very different. So, unlike how people can steal content, you can’t steal live sports. So that has developed in a different way than traditional movies and television. Also younger generations aren’t consuming sports as much. You’re not watching an entire baseball game, even though the World Series starts shortly, because people just don’t have the attention span. There’s also a lot of competing content. For instance, in Major League Baseball, they are focused on how do I capture these consumers when the average fan is over 55 years old?
So it’s like traditional M&A, but with a twist. Understanding the industry is extremely important in executing a transaction successfully.
Morrow: That makes total sense. As far as understanding the industry, do you think that it helps to live in a hub where the entertainment industry is very popular such as Los Angeles or New York?
Masuda: I think New York and LA are great places to be. Other markets are probably okay, too, such as the Bay Area and Atlanta, where there’s a huge music and film presence. I do think that locality helps. I spend most of my time in LA and NY where the concentration of my clients are. I still like to do in-person meetings and I think that’s important – the human touch in providing legal services.
On his Favorite Parts of the Job
Morrow: Absolutely. I wanted to pivot a little bit to what do you enjoy most about your job, as well as, what are some things that you wish you could change about?
Masuda: That’s a great question. Let me start with the positive. What I enjoy about my job is that it’s a little ivory-towerish. You go in, you negotiate transactions, and you have to be creative. And then the two parties are happy once they finish the transaction. I then move onto the next deal. You’re not worrying about the day-to-day issues, such as the integration and the other types of issues that inevitably come up with an M&A transaction.
So, it feels like you’re like a hired gun. You come in, you do it, you learn about the company, and then three or six months later, you’re off doing five other deal. That’s what I really enjoy about it. That’s perfect for my level of attention span.
What has been challenging in big law practice is that firms have become extraordinarily financially successful over the past 20 or 30 years and at some point it has come at the cost of culture. So, I think it’s harder for you, as a law student, to see some of the differences among the firms. But there have been cultural shifts as firms have become more bottom-line oriented.
So, my advice to young lawyers who would like to go into private practice is to make a careful choice. Look at the signs from the younger lawyers at the firm. Make sure it’s a place that hasn’t sold out its culture for profitability.
I work really hard, and it’s really important that I be around people who share my values so I think it is important to find a firm that has a culture.
And I think that’s the unfortunate side effect of the law firm models – that culture has dissipated some over the years.
Advice for Current Law Students
Morrow: Thank you for sharing that. I think that is definitely something we need to keep in mind. Pivoting just a bit, what advice do you have for current law students who are considering going into the world of entertainment law?
Masuda: I would think about entertainment a little bit more broadly. I think a lot of law students focus on talent representation – that’s almost like being a talent agent in some respects.
I think that doing entertainment on either the litigation side or the corporate side at a larger law firm is super interesting because we are like canaries in the coal mine, in terms of when new ideas come out, we’re doing deals and trying to execute. For example, NFTs and the changes to content distribution.
I think there’s a lot of broad ways to be involved in the entertainment industry as a lawyer, other than talent representation. My advice would be to try out a whole bunch of different areas. You never know what you like or don’t like until you try it. There will be unique opportunities. One of my favorite sayings is that when opportunity knocks, too many people are in the backyard looking for the four-leaf clover.
I was super interested in sports and I would have been perfectly happy just practicing sports law, but some of my skills translated well into the entertainment industry. The deal structure translated well. And now I’m really interested in entertainment. It was kind of by happenstance, but there was a good opportunity and I tried to follow it as best as I could.
On Trends in the Entertainment Industry
Morrow: That makes sense. When you were a student at Harvard, was there anything that you took advantage of that you recommend that current students take advantage of?
Masuda: I did a clinical at the Attorney General’s office in Boston while at Harvard. It was a wonderful experience and I got a chance to do some administrative hearings. That experience solidified to me that I didn’t want to be a litigator.
But, I think the biggest benefit of law school is just the friends that you meet. From staying in touch with them, I see that they are all doing wonderful things. I was just in Washington D.C. and I met with one of my law school classmates who was a great friend and now he’s doing interesting things in government. I would take advantage of the quality of people that you meet at Harvard Law. Developing and maintaining friendships was the best part of law school for me.
Morrow: Thank you for that. We are coming to the end of the interview and I wanted to ask you one final question. What is a recent trend in your industry that you think law students should do some research about?
Masuda: That’s an interesting question. I hate to sound like everybody else but I think copyright issues relating to AI. This issue came up during the Writers’ Strike as well. I would look into whether you can protect intellectual property rights in AI or what parts of it can be protected.
Like it or not, I think AI is here to stay and I think it is going to really shift the entertainment industry. For example, in writing scripts for shows, even replacing talent with artificial intelligence.
I think that that is a really interesting area and I think as it evolves and technology improves, it will have an incredible impact on the industry.
On Personal Life
Morrow: Definitely! Lots of my professors have also been interested in the future of AI. We have been having such a great conversation, so last question for real this time. What are some things that you do in your free time?
Masuda: I’m a brand-new empty nester. I have three children. They’re all out of the house now. Two are in college, and one is working. I enjoy hiking and playing tennis in my free time. That said, I’ve only been an empty nester for a few months now so I’m still figuring it out.
I enjoy just hanging out with friends and cooking, but I’m still a huge sports consumer.
Unfortunately, my Dodgers got eliminated early in the playoffs, but I’ll be watching the World Series.
Morrow: Hopefully, you still have the Lakers to look forward to! Thank you so much for taking the time to interview with us today. We really appreciate your insight!
Masuda: It was my pleasure. Thank you!
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