Indecent Exposure (57 page)
- The
Times
article exemplified the extraordinary momentum of the Columbia scandal as a media event. The "tip of the iceberg" theme, first enunciated by Cliff Robertson in
The Washington Post
on Christmas, implied that corruption was rampant in the executive suites of Hollywood. It implied that check forgery and other forms of embezzlement were commonplace. Even though the allegation was not substantiated by Robertson or anyone else, it had gained widespread credence in the press by mid-January, and was gradually expanded to embrace allegations of bribery, kickbacks, and all manner of corruption, none of which was documented. But by the end of the month.
The New York Times,
one of the most responsible newspapers in the world, chose not only to perpetuate the "iceberg" theory in a big front-page story but to expand the dimensions of the. "iceberg" still further by appending to it allegations of other types of illegality whose relevance to embezzlement was highly questionable. If one man's check forgeries were indicative of widespread check forgery and other forms of embezzlement (and they might have been); and if the embezzlement was indicative of general corruption, including bribery, kickbacks, and other felony crimes (and it might have been); and if all that corruption could legitimately be said to encompass decades-old courtroom wrangling over film-profit percentages and antitrust questions (one could argue that it did),
The New York Times
failed, at each juncture of its article on Sunday, January 29, to make the case. But no matter. It was on the front page of
The New York Times.
There was no stopping the snowball now. The
Times
story was mild compared with what was to come. - The
Los Angeles Times,
the
Los Angeles Herald Examiner,
the London
Observer,
and many other papers carried more modest stories on the Columbia scandal that Sunday. On Monday,
The Wall Street Journal
ran a lengthy page
-one analysis of the power stru
g
g
le inside the company. - FORTY-THREE
- Alan
Hirschfield
and Joe Fischer read the
Journal
article aboard the nine o'clock American flight to Los Angeles Monday morning. Though he was still furious with Herbert Allen,
Hirschfield
again was doing Herbert's bidding. He was returning to the studio, expressly this time to show support for David
Begelman
. "If you want us to back you, you're going to have to back David." Herbert had said. Hirschfield thus would meet with the motion-picture executives Monday afternoon and the television executives Tuesday, and he would try to rally them from the stupor that had numbed them since Begelman's reinstatement. "Despite what you might have read or heard," Hirschfield would say, "David has my full support and I, in turn, have the full support of the board of directors. David and I both are at Columbia to stay. It's time for the company, its executives, its staff, and all its employees to forget the past and work hard for the future." Hirschfield wondered how he and his listeners would get through the speech without bursting into either laughter or tears. For unlike Herbert Allen, Hirschfield was convinced that the
Begelman
problem could not be talked out of existence. From daily telephone conversations and from his own observations at the studio earlier in the month, it was clear to Hirschfield that the "elephant in the room" phenomenon, which had been so evident during the fall when
Begelman
had attended studio functions while on suspension, was worse than ever. Now, the check forger not only was in the room. He was president of the studio again. - But Hirschfield had to carry on. He had to maintain an appearance of order and harmony. He had to keep buying time—until it became clear whether he would succeed in inducing a strong outsider to bid for control of the company. And that meant supporting
Begelman
for the time being, no matter how false the sentiment. - For the first time in years, Hirschfield did not stay at the Beverly Hills Hotel. Hoping to avoid the press, which had been pursuing him day and night on both coasts, he chose the equally elegant but newer, smaller, less pretentious, and less known L'Ermitage, which was situated on Burton Way in Beverly Hills and had become a favorite hotel of wealthy Europeans who wanted to avoid the charged, show-business atmosphere of the Beverly Hills and the Beverly Wilshire.
- After checking into the hotel,
Hirschfield
went immediately to the studio, and in the visiting-executives suite found a very pale Joe Fischer. - "Have you seen this?" Fischer asked, handing Hirschfield a copy of the new issue of
New West
magazine, which had just come out that day. The magazine's cover story, entitled "The Incredible Past of David
Begelman
," was Jeanie
Kasindorf's expose' of
Begelman
's disputed handling of Judy Garland's funds in the early sixties when he was her agent. Spread over seven pages, the article repor
ted the details of Sid Luft's decade
-old allegations that
Begelman
had embe
zzled hundreds of thousands of dollars from Garland in part by manipulating her checking accounts. Checks—the same method he had employed in stealing from Columbia Pictures. - "Sid Luft's files go back to 1961," the article said. "He is sure they show that David Begelman's check-cashing problem is more than 'aberrational.' "
- Alan Hirschfield was nearly incoherent. "Jesus Christ, I cannot believe what I am seeing," he said, scanning the article, whose most dramatic illustration was a photocopy of the front and back of a check for $6,000 which
Begelman
allegedly had written on Judy Garland's New York checking account and cashed in Las Vegas. There was Begelman's sweeping signature—the same handwriting that had been found on the Cliff Robertson check, the Martin Ritt check, and the Pierr
e Grole
au checks. - "Doe
s that signature look familiar?" Fischer asked. - Questions about the checks had been raised in a report prepared by a Beverly Hills accountant, Oscar Steinberg, who had audited Judy Garland's financial records in 1963 at Luft's request. According to Kasindorf, Garland was in rehearsal for a CBS television scries when she saw Steinberg's report and did not want to be bothered. Kasindorf quoted Luft as saying, " 'When Judy got a copy of the report, she said, "Look, suppose he did steal $200,000 to $300,000; sweep it under the rug now. I'm going to make $20 million on these television shows. What is $300,000?
- "That sentiment would be echoed on the Columbia Pictures lot fourteen years later," Kasindorf wrote, and again quoted Luft: "Columbia has covered up for David just like Freddie Fields once did fifteen years ago. There's a list a mile long of people who've covered up for David
Begelman
." - In addition to reporti
ng Luft's allegations, Kasindorf’
s article reviewed the current brouhaha at Columbia, giving particul
ar attention to Ray Stark's tie
s to
Begelman
and to Allen & Company. And she revealed that even though
Begelman
often had indicated to people that he was a graduate of Yale and its law school, the university had no record of awarding him a degree. - As Hirschfield was reading the article, Dan Melnick walked in. "You've seen it," he said. "Stark really charmed Kasindorf out of her pants, didn't he?"
- "I
knew she was too smart,"
Hirschfield
said.
There were calls from New York on every phon
e line into the suit
e. It turned out that the Kasindorf article had appeared that day, as well, in
New York
magazine under the title,
begelman babylon.
Hirschfield spoke with Jaffe, Adler, Lang, Kaufman, Gruenberger, and others. No one knew what to do next. Everyone was shocked. And everyone was responding, of course, not so much to what the article said in a literal sense, as to what it suggested and implied: that David
Begelman
had been a crook all his adult life, that his embezzlements from Columbia were, indeed, the "tip of the iceberg"—an iceberg not of corruption in Hollywood (a subject the article did not address) but of corruption in David
Begelman
's past, an iceberg which Columbia's supposedly careful and thorough investigation of
Begelman
had missed entirely.* - "If this is true,"
Hirschfield
told the others, "the jig is up. There's nothing that can be done for him now. It's the same pattern. God knows what else we're going to hear about. It's like the breaking of a logjam. This stuff is going to be coming from everywhere." - A meeting of the top officials of the studio, including
Begelman
, had been scheduled previously for early afternoon.
Begelman
arrived, looking ill and exhausted. - "I guess you've seen it," he said to Hirschfield. "I've authorized my lawyers to sue. Freddie and I have legal documents, signed by Judy, releasing us from any financial obligation to her. Sid Luft has been walking around with this stuff for fifteen years. He's a publicity hound. We went through it all years ago. It's dead and settled. I'm going to sue him."
- "Maybe you'll want to talk to your lawyers this afternoon instead of meeting,"
Hirschfield
suggested. - "No, let's go ahead and meet."
- Feeling foolish, Hirschfield proceeded with the remarks he had prepared. "Look, these are tough times," he told the studio executives, more than perfunctorily but less than enthusiastically. "We've got to
- *
A close reading o
f the article would have reveale
d that it actually documented and stated far less than it suggested and implied. While
the accountant's report in 196
1 raised legitimate questions about Begelman's handling of Garland's money, it neither answered the questions nor proved wrongdoing. While Garland and Sid Luft had brought suit against Begelman and Fields in 1967. Garland bad dropped the suit the nest year, formally released them from
any financial obligation to her,
and subsequently bec
ome their client again. While Luft had continued the suite on his own. he had not pursued it
for ten years. While failure to pursue a lawsuit is not necessarily evidence of lack of substance, it surely
raises the question of whether the suite
has merit.
In most jurisdictions, failure t
o pursue a suit automatically results in its dismissal by the court. However, t
here is no such procedure in Ne
w York, where the
Luft
suite was filed, so technically the suite was still aliv
e. - pull together. Regardless of anything you read or hear, David has my backing. I wouldn't have brought him back if I didn't know he could do the job. We've got to pull together here."
- The group went on to an agenda of regular studio business.
Begelman
was called out of the room every few minutes to take phone calls. During his absences, there was whispering about the
New West
article. The agenda finally was covered and the meeting was adjourned. - Early that evening
Hirschfield
kept an appointment with a man who wanted to discuss the possibility that Columbia Pictures Industries might purchase the Howard Johnson hotel and restaurant chain. Hirschfield had difficulty concentrating; he kept seeing the photostat of Begelman's signature. - Joe Fischer, too, couldn't get his mind off the article. Dining with Jim Johnson at The Saloon in Beverly Hills, he studied the piece line by line. Fischer was seared by a sentence that Begelman had uttered in 1963 in rebuttal to a charge by Sid Luft. "I swear on the life of my child,"
Begelman
had said.
Looking incredulously at Jim Johnson, Fischer said: "That's what he told us in September when he was claiming we had found everything! Then we found more!" - david hartman:
Good morning, Rona. - rona barrett:
Good morning, David, and good morning, America. The media investigation of Columbia Pictures president David Begelman, who admitted to financial wrongdoing before being reinstated to his executive post, has started an investigative juggernaut that has Hollywood in an uproar. Regardless of how industry executives view the Begelman situation, the consensus is that whether he now resigns under pressure or not, his conduct has already opened up Hollywood to such strong scrutiny that the industry may not withstand the pressure of so many prying eyes. Currently,
The New York Times
and th
e
Wall Street Journal
are conducting full-scale, across-the-board investigations of industry activities, and executives are worried that before the spotlight is off Hollywood, its already precarious reputation as an upstanding industry will be demolished. Ironically, this scrutiny comes at a time when industry profits have never been higher. However, with the billions of do
llar
s
Hollywood earns,
it must be accountable to the same standards of behavior ethical people apply to all businesses. Therefore, while I deplore the headline-grabbing stories that are long on accusations and short on insights that have been published in regard to
Begelman
, I am confident that a reasonable look at our industry, by well-informed analysts who know the territory, can only do Hollywood a world of good in the long run.
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