Indecent Exposure (47 page)
- "That was the worst board meeting I've ever attended," Fischer said. "I have never in my life seen anything like that."
- Adle
r looked at
Hirschfield
and said, "I assume you see from what went on in there that even if Begelman isn't reinstated, he's going to be running the company from his consulting position." - "I see very clearly," Hirschfield replied. "They're systematically emasculating me, my ability to run this company. This isn't the end. It's just the beginning."
- Ira Harris, who had returned to Chicago that morning, had left a telephone message
for Hirschfield. "Important! Pl
s call when alone." When Adler and Fischer left, Hirschfield phoned Harris. The investment banker had spoken to Jimmy Goldsmith, and Goldsmith was indeed interested in discussing Columbia Pictures when
Hirschfield
was in London.
In Los Angeles that evening. David Begelman was relaxed and charming—and still looked very much like a mogul—when he and Gladyce turned out for the black-tie West Coast premiere of Ray Stark's
The Goodbye Girl
and the supper party at the Century Plaza following the film. - THIRTY-FIVE
- For at least two decades, David
Begelman
had been known as one of the most skilled negotiators of deals in the entertainment business— perhaps the most skilled without exception. His mind was agile and creative. He could marshal broad concepts and tiny details with equal case. He could charm. He could bludgeon. Quite conceivably, therefore, he could have negotiated his production-consultation contract with Columbia, and the settlement of his old contract, without assistance. But he chose to supplement his own skills with tho
se of his lawyer. Frank Rothman,
who flew to New York on
Begelman
's behalf Thursday afternoon. - Hirschfield
, by contrast, felt ill equipped for the negotiation. Aside from lacking anyone with
Begelman
's special mixture of skills to represent the company. Hirschfield believed that the board, by insisting that Begelman be made "whole and happy," had undermined the company's ability to conduct a strong negotiation. The board, in effect, had thrown its power to Begelman, and Hirschfield assumed that Begelman and Rothman knew that. - To handle the negotiation, Hirschfield appointed Joe Fischer, Victor Kaufman,
Todd Lang, and Peter Gruenberge
r, and also summoned Eli Horowitz, the chief contract negotiator at the studio. Horowitz flew in late Thursday, and the negotiators began their work Friday morning in Todd Lang's suite at Weil, Gotshal & Manges.
Begelman
, after conferring twice with Rothman by phone on Friday, came east that evening, and joined the group on Saturday. - The temperature was in the twenties and a strong wind off Central Park buffeted the General Mo
tors Building, chilling the unde
rheated and otherwise deserted law offices, and forcing the negotiators to face each other in sweaters and overcoats. Lunch was brought in. By the middle of the afternoon, it began to appear unlikely that an agreement could be reached without personal intervention by
Hirschfield
.
Begelman
was demanding that his production deal include provisions that Columbia had never given any producer. The company negotiators were refusing.
Begelman
and Rothman were threatening to leave and return to Los Angeles with the deal unresolved. Finally Todd Lang advised Hirschfield by telephone that "only two people can conclude this—Alan
Hirschfield
and David
Begelman
. You'll have to see
him yourself." Hirschfield reluctantly agreed and asked that
Begelman
be told to come to Scarsdale on Sunday morning. - Begelman balked. His last conversation with
Hirschfield
had been unsatisfactory. Peter Gruenberger insisted, however, that David go to Scarsdale. After conducting a difficult six-week investigation and then waiting through another three
weeks of uncertainty, Gruenberge
r had little patience left. "David, I won't stand for a scene over this," he said. "Do it as a favor to me. I think I've treated you fairly during this whole ordeal. I could have hurt you. Now, do me the favor of going to see Alan."
David agreed. He would see
Hirschfield
alone. Frank Rothman had to return to Los Angeles to prepare for a Monday court appearance on another matter. - Berte
and Alan Hirschfield rarely dined alone, even when Alan was not traveling. When they were home, one or more of their children usually was present. When they went out, they normally were with other people. Alan occasionally remained in Manhattan
on weeknights, and in Scarsdale
on the weekends there frequently were guests. While not dissimilar to the habits of many busy affluent couples, the Hirschfields' daily routines signaled an
additional factor: their fiftee
n-year marriage was under strain. As in many troubled marriages, however, each remained the other's closest confidant, particularly in a crisis. So it was that on the evening of Saturday, December 10, a bitterly cold evening, the coldest since the previous winter, Alan Hirschfield sought the private solace of his wife. They drove up Interstate 684 into northern Westchester, across Bedford Road, and up the Old Post Road to the hamlet of Bedford and a cozy, informal restaurant called Nino's. Situated in a converted barn, Nino's was the antithesis of the high-profile Manhattan and Beverly Hills restaurants where the Hirschfields usually dined, and they had gone there in the past when they wanted privacy. Anonymous, and free of interruption, they talked quietly for hours about Alan's plight and his pain. And Berte became the first to know that Alan had tentatively decided to succumb to the pressure and reinstate David
Begelman
to the presidency of the Columbia studio. - "There no longer is a right answer and a wrong answer," Alan said. "There are only wrong answers. There are only bad decisions. As compelling as the arguments are against reinstating him, they lose a lot of their compelling quality when I see that if those arguments are followed, it will be impossible for me to run the company. It's not being run now. The company is convulsed by civil war. If Begelman is not reinstated, the war will go on and get worse. The board made it abundantly clear on Thursday that it is willing to systematically undermine my ability to run the company, and that it is going to treat
Begelman
as the dc facto president of the studio whether his title is president or only consultant. That's entirely unacceptable to me. So what options do I have left? 1 can't and won't resign. That would be a betrayal of the people I've brought into the company. It would be total surrender, and I'm not going to leave without a lot more of a fight than I've put up so far. I'm primarily responsible for this company's return from the abyss. I orchestrated one of the most spectacular corporate recoveries on record—from the brink of bankruptcy to full prosperity and an utmost unlimited future. This is my company in a very real way."
"Right," Berte said. "You're one with the company. You're a big part of it, and it's a big part of you." - "So it's quite possible that the only thing to do under the circumstances is to take him back. It's a short-term solution. It's not a cure. It's like a shot of morphine to relieve the pain overnight, but if I don't take it I may be dead by next week. I'll just have to go from day to day and see what happens. If I bring him back, it will at least establish a truce with the board, even if only temporarily. Meanwhile, maybe somebody like Jimmy Goldsmith will come along and make the
Allens
an offer they can't refuse. If something like that could be encouraged or arranged, I could always get rid of Begelman later." - "The most important thing now is to do what is best for you personally," Berte said. "If this is what you have to do, then this is what you have to do. You've tried to do what you think is right, and it doesn't seem to work. What you see, no one else seems to see. Your friends have betrayed you. If they hadn't been your friends all your life, it would be easier. But in any event you're not compromising your principles. You're just opting for a short-term solution. If the short-term problem isn't solved, the long-term won't mean much."
- "Maybe I'm deceiving myself. Maybe this will only make things worse. Maybe all the bad things that I've predicted if he's reinstated will in fact happen."
- "You'll just have to improvise. It can't get any worse than it is now."
- "I know one thing. I'm never again going to subject myself to a board meeting like that one on Thursday."
- "Nor should you have to."
- "I haven't definitely decided yet, but it can't go beyond tomorrow."
- With large windows on three sides, the Hirschfields' living room was one of the brightest rooms in their ninety-year-old, three-story home. The living room was on the cast side of the house, off a large foyer-gallery and the main staircase. The dining room was on the opposite side of the foyer, and beyond the dining room was a large, sunny den. The kitchen, pantry, and another staircase were behind the dining room at the back of the house. Most of the family traffic was through the den, dining room, and kitchen, as well as on the upper floors via the back stairs. So the living room, somewhat isolated by the foyer, was the best place in the house for private business meetings, and it was there that
Hirschfield
's negotiating team—Fischer, Lang, Gruenberger, Kaufman, and the studio's Eli Horowitz— assembled at ten Sunday morning. Since it had fallen to
Hirschfield
himself to conclude
Begelman
's production arrangement and contract settlement, it was necessary that he be briefed on the lengthy and complex negotiations that had taken place on Friday and Saturday. There was a general consensus that unless either he or
Begelman
was prepared to make major concessions, it would be difficult to strike a deal. - Begelman arrived at noon and was surprised to find six people from the opposition camp instead of one; he had thought he was going to a genuine summit meeting.
Soon,
it
turned out that he was.
Hirschfield
and Fischer stayed. The others repaired to Todd Lang's home just around the corner to await recall if needed. Fischer settled in the Hirschfields' den with the Sunday
New York Times
and football on television. And Hirschfield and Begelman shut themselves in the living room,
Hirschfield
having told everyone that he and David would require no more than an hour or so.
- Except for a bathroom break, they did not leave the living room for six hours.
- Hirschfield explained why he could not give Begelman as "rich" a deal as David wanted. It would embarrass the company publicly and would be scorned by the SEC.
Begelman
explained why he could take no less; he couldn't worry about what the SEC would say. He was getting on in years and had his own security and that of his family to consider. - They talked about the consulting Begelman would do, apart from producing films.
- "If it was up to the board,"
Hirschfield
said, "you're the de facto president of the company, so
I
guess you'll be a full-time consultant."
"Well, in my opinion,
I
have a large contribution to make. I can be very helpful."
"I'm sure that's the case. There's never been any question about your talents. Except that no one can have two bosses. Danny
Melnick
can't report to two bosses. Norman Lev
y can't report to two bosses. We
can't run a company where someone is the president in title and someone else is the p
resident in fact. We
can't have the board running to you to second-guess every deal that the president of the studio or the president of TV wants to make." - Hirschfield
recounted the board meeting of the previous Thursday. "There have been all kinds of threats and mandates laid down by the board." Hirschfield continued, "about how the company is to be run—the role you have to play, the role I have to play. I am in deep trouble with the board, and quite frankly. David, you
are
really no longer the issue here. I'm in a spot where I can't win. If I bring you buck I've compromised my position and I'm letting the company in for a lot of grief from the various communities and people with whom we have relationships. If I don't bring you back, I've alienated the board. I think my tenure here is certainly going to be limited, and my ability to be effective is highly limited. I assume you've heard about Herbert's threats, and I assume you've heard about Ray's threats, and I assume you know about the telegrams and phone calls, and I assume you know about
Berte
and the threats that have been made against her." - Begelman
professed ignorance of the details of the pressure on Hirschfield. - "Well, all of that has been a way of life here for the past couple of months,"
Hirschfield
said. "I've been put in a position where it's me versus the board. You
are
no longer the issue. Whether you come back or you don't come back, this is a contest of wills between me and Herbert Allen, and me and Matty Rosenhaus, but essentially Herbert, who feels that he has the right to call the shots as to who's going to run this company. Herbert and
I
are
really on the outs, and it looks like irreparable damage has been done there. Matty and
I
are on the outs, and it looks like irreparable damage has been done there. Irwin Kramer, who was for your conviction and hanging at the beginning, saw the light of day and became the loyal son-in-law, your strong advocate, and
Berte
's prosecutor."
"Alan, perhaps I could be of help in repairing that damage. I'd be happy to do anything I can."
"I don't think there's anything you can do. Quite frankly, the issue is not you. You're simply a pawn at this point in time. But I must say that faced with the prospect of having you become a consultant and in effect run the company in that capacity without my direction, it might be better if you came back into the company and we tried to use that as a mechanism whereby perhaps we could put this whole thing to rest and get on with the remainder of our lives. As far as I'm concerned, just sitting here and talking to you, I'm probably better off bringing you back simply because
it's the only chance that I see
for any kind of rapprochement with the board, and any kind of peace and quiet, and any kind of settling down of the problems, so that I can go back to running the company. David, I cannot run the company! It's clear that I no longer have the backing to run it!" - "Lo
ok, I'll do anything you want me
to do. Obviously, more than anything else in the world, I would like to come back. I'll give up everything I've asked for in terms of the independent arrangement. I know I can't have a new contract. I know I'll have to abide by my old contract. But all that aside,
I
can't help but recall that a week ago, you said I was being stuffed down your throat. In spite of everything you've said, I still don't believe it would be good for either of us for me to come back if you feel that way about me." - "Well, I've had to think about this in broader terms. You're really looking at a man who is beaten down. I've tried to do what is right. I've been accused of 'Going Hollywood.' I've been accused of being out to get you. I just don't have any good answers anymore. But I do know that the company's coming apart at the scams. This fight is just splitting it apart, and everything we worked for
,
for the last four and half years is just being torn asunder by what's going on, and I see no prospect of any improvement. One way or the other, the board is going to have you back. You're either going to be called a consultant, or you're going to be called president, but as far as they're concerned, they want you back." - "Look, I'll do whatever you say. I'll never forget this
opportunity if you give it to me
. I'll spare no effort not only to do my job, but to justify your confidence, and I'll also spare no effort to try to square things between you and Matty and Herbert and the rest of the board for being big enough to give me this chance. But in order to succeed 1 must have bona fide support from you. We can't be working against each other. You would have to be willing to give me a chance. There would have to be at least a measure of true willingness by you to have me back." - "Really, David, at this point, it doesn't make any difference to me, quite frankly, whether you come back or you don't come back. Except that if you do come back, maybe there's a chance to pull it together. If you don't come back,
I
see no chance." - "Alan, I can make it work. I'll double my efforts to build these businesses. I know it will work.
I
know
I
can do it if I have your support and your confidence. We can make things right with the world. You just name the terms and I'll sign the piece of paper." - "Well, I want to think about it a
little more. But it seems to me
as
I sit here and talk to you and listen to myself, that I'm going to be
wrong either way, and I may as well be wrong in the direction of
giving the company a chance to survive. Because it ain't going to
s
urvive the way we're going. That
's clear." - * * *
- Six o'clock. Hirschfield and Begelman sat in chilly shadows. It was dark outside and the temperature had dropped below 20 degrees. Only one lamp was on in the big living room.
- Hirschfield
went across to the den and asked a bewildered Joe Fischer to summon
Lang and Gruenberge
r. With the five men assembled in the living room, Hirschfield asked the lawyers to reiterate the likely consequences of Begelman's return. They listed the well-known risks. If
Hirschfield
wanted to change his mind, they would inform the staff of the Securities and Exchange Commission the next day.- "I want to think about it some more." Hirschfield said.
- "Alan, please," Begelman said, "I'll do whatever you want, but I must know for sure before I leave here. The uncertainty is tearing me apart."
- Hirschfield stood by a window staring up into the cold, star-lit sky. His attention was momentarily diverted by what appeared to be a meteor. "There's a shooting star or something," he said. "There wasn't a space shot tonight, was there?"
- "Don't think so," someone answered.
Hirschfield paused, still gazing out the window. Then he turned back to the group. "Okay, I'll take him back." - David Begelman's eyes glistened with tears. He stood and embraced
Hirschfield
.
"I
won't let you down," he said. - The limousine dropped
Begelman
at the Drake at 7:30. - His first call was to Gladyce, who was dumbstruck. "Are you sure this is right?"
- "No, I'm not sure of anything, but that's where I'm at."
- His second call was to Herbert Allen, who laughed. It was not a laugh of merriment or glee, but a laugh of cynical surprise and bemusement.
- "What did Alan say?"
- "He said to me that I'm not just the best man for the job. I'm the only man for the job."
- "Well, what do you want to do?"
- "I'd like a chance to make up for all the horrible things I've done to you and to all the other directors and to the company."
- "Well, whatever you two fe
llows want is fine with me." Herbert said. - Begelman
's third call was to Frank Rothman, who was at home in Beverly Hills preparing for his court appearance the next morning. Rothman chuckled. - * * ·
- In Scarsdale, Alan said to
Berte
, "It's a shot. It's an expedient for the moment. It may buy enough time for things to calm down so that I can find a suitor to come along and buy these people out. Then I can walk in the next day and fire
Begelman
. That's my fantasy." - Alan telephoned Herbert later in the evening, "You've made him the de facto president of the company, anyway. He might as well have the title. This is what you've always wanted. Maybe it'll give us an opportunity to repair some of the damage. Maybe we can move forward. It's certainly a disaster where we're at. So he's coming back, unless I have a change of heart in the next couple of days." Without responding to Alan's anger, He
rbert said simply and gently: "I
think that's terrific. That's the right decision. You two will work it out." - "It may not work out so well, Herbert. There's going to be a firestorm of publicity."
- "It'll all blow over in a week."
"I hope so. I'm gonna call Matty."
"You should call Matty," Herbert said. - To
Hirschfield
's horror, Rosenhaus was angry. - "How could you do this? I thought you were going to negotiate a deal."
"Matty, we couldn't negotiate a deal. It was the wrong deal. It was an outrageous deal."
"There's nothing wrong with the deal. We can give him whatever we want. If you don't want him, you shouldn't bring him back." - "Matty, it's not a question of what I wan
t anymore. It's the only way I
see to try to preserve this company and bring it back together instead of tearing it apart and ruining everything we've done for the last four and a half years." - "Well, you shouldn't do it unless you really want him. He was willing to become a consultant."
- "He wasn't a consultant, Matty. He was going to be the de facto president of the studio."
- "Well, consultants can get into everything."
- "Look, Matty, this is what you want and you've got it. For better or worse, you've got it
. Mat
ty! This is what all the fighting has been about for the past three months! He's back! I'm going to bring him back!"- PART THREE
THIRTY-SIX - A euphoric David
Begelman
flew back to Los Angeles on Monday in time to accompany his wife to a party whose timing could not have been better. Given by producer Allan Carr at his home in Benedict Canyon, the party honored the pu
blication of a book that Gladyce
Begelman had coauthored—a book which had become an embarrassment both to the Bcgelmans and to Columbia Pictures because of its coincidental juxtaposition with the investigation of David for "unauthorized financial transactions." Entitled
New York on $500 a Day (Before Lunch),
the book was a tongue-in-chee
k but quite comp
rehensive guide for wealthy free
spenders. - The Begelmans' embarrassment (if not Columbia's) had been instantly nullified, however, by Hirschfield's decision to reinstate David to the presidency of the studio. Despite all of Todd Lang's warnings, David had convinced himself that when he returned to his job it could be made to appear that he was being exonerated on the "matters of judgment" that had been in question, and that no one except the inner circle ever would know what he had really done.
- Since David's restoration was to remain confidential for a few days, he and Gladyce could not give free rein to their joy while at Allan Carr's party. But it was with light hearts indeed that they mingled with the two hundred or so guests, many of whom were close friends—Ray Stark, Sue Mongers, Dan
Melnick
, David Geffen, Candice
Bergen, Marty Ransohoff, Ed McMahon, and many others. Allan
Carr, producer of the soon-to-be-re
leascd
Grease,
had a reputation for giving some of the more flamboyant parties in a town long noted for flamboyant parties. Carr's invitations were imitation
"Master Charge" cards in Gladyce
Begelman
's name. Six colorfully cos
tumed carolers roamed through the crowd singing Christmas
songs. And red and white poinse
ttias were everywhere. - Ray Stark, as it happened, a
lready knew David's news but re
sisted the temptation to spread it around the party. However, the glaring irony of Gladyce's book and David's predicament, whatever the outcome, was a source of amusement rather than discomfort for the guests in general. Hollywood is a town that takes delight in spitting in the face of irony. - For Alan Hirschfield, the next several days amounted to a brief period of pretending—pretending that the
Begelman
crisis had been contained, pretending that a week in London and Paris would ease his problems in New York and Los Angeles, and pretending that he could meet secretly with Sir James Goldsmith, one of the world's most rambunctious business tycoons, without anyone's finding out. In part, the pretending reflected a natural yearning for rest and recreation after three months of intense, seven-day-a-week pressure. But in a more fundamental sense, it reflected the somewhat homespun naivete" that was a deeply ingrained part of Alan's character— "the Oklahoma in him" as
Berte
saw it—a quality that endeared him to many people but also occasionally left him vulnerable. - Alan and
Berte
flew to London on Tuesday to head the Columbia Pictures delegation at the British premiere of
The Deep.
The premiere, which Prince Charles and Lord Mountbatten would attend, was
to be held on Thursday evening a
t the Odcon Theater in Leicester Square as a benefit for the English National Opera and Sadler's Wells Benevolent Fund, and the Variety Clubs of Great Britain. - The most important event of the week, however, was not the premiere. It was the rendezvous with Jimmy Goldsmith. In two phone conversations with Ira Harris on Monday in New York,
Hirschfield
had agreed to a meeting Friday afternoon at Goldsmith's estate outside London. The plans for the meeting were highly confidential;
Berte
, for one. was acutely conscious of the secrecy and made a point of reminding herself not to mention it. even t
o close friends they were to see
in London. - It was Alan Hirschfield's first royal premiere and he savored all of it—walking up the red carpet, being announced to the prince, and being a center of attention at the gala dinner dance after the movie in the ballroom of the Savoy. Director
Peter Yates, producer Peter Gube
r, and the author of
The Deep.
Peter Benchlcy. flew in for the event. Most of the leading figures in the London film world were present, as well, and most of them paid their respects to Hirschfield, the man who had saved Columbia Pictures. Aside from a few whispered exchanges through the evening, nothing was said about the Begelman affair. So far as the guests knew, it was still under investigation, and Hirschfield said nothing to the contrary. - In New York, Cliff Robertson and Dina Merrill had begun hearing rumors that Columbia was going to reinstate David Begelman to the presidency of the studio. Incredulous, they pondered what to do. Cliff decided it would be inappropriate for him directly to contact Leo Jaffe or anyone else at Columbia. Dina, however, had an idea. As one of the wealthiest women in the nation and the daughter of the late E. F. Hutton, she knew people in Wall Street and had met Charlie Allen on occasion. It occurred to her that Charlie might not know the nature of David Begelman's misdeeds and that if he were informed, he might prevail upon Columbia Pictures
not to reinstate Begelman. Dina
tried to contact Charlie but was unable to reach him. She was telling her troubles to a friend over lunch at "21" when the friend pointed out that Charlie Allen's daughter, Terry Allen Kramer, was seated just across the room. Dina, who had never met Terry, went over and introduced herself, and explained that she had been trying to reach Terry's father to discuss David Begelman. She had heard a rumor that Columbia was about to reinstate Begelman and was sure there must have been a misunderstanding of what Begelman had done. Terry assur
ed her that Columbia and the All
ens were fully informed and that Dina should not worry about it. - "But you don't understand." Dina said. "David
Begelman
forged my husband's name on a check. He's a crook." - Terry Kramer assured Dina that she
did
understand and the situation was under control. She repeated her suggestion that Dina not worry about it. - Dina turned and walked away, nonplussed. "You'll never believe what just happened to mc." she said to Cliff a few minutes later at the UN Plaza.
- From his suite at Claridge's,
just before leaving to see Jimmy Goldsmith. Alan
Hirschfield
participated by telephone in a meeting of the Columbia board of directors, which was called to ratify the reinstatement of
Begelman
. It was agreed that his return to the studio would be announced the following Monday. - * * *
- Hi
rschfield's limousine required t
he better part of an hour to make its way through the late Friday afternoon traffic to the estate in the London suburbs. Jimmy Goldsmith turned out to be an engaging man—strapping and energetic—whose baldness made him look older than his forty-five years. Tea was served in the study in front of an open fire. Children were about, and it occurred to Hirschfield that Christmas was only nine days away. - Someone—presumably Ira Harris—had sent Goldsmith two of Columbia Pictures Industries' annual financial reports, but it appeared that he had only glanced at them. As an astute businessman, he knew that an annual report contained only a minor portion of the information that one needed before making an investment. Hirschfield spoke for more than an hour about the American entertainment business, about Columbia and its financial recovery, about the
Begelman
problem, and about the festering enmity at the top of the company. Goldsmith was very interested and made it clear that if he were to invest he would want to purchase all the stock owned or controlled by the
Allens
and by Matty Rosenhaus—a total of just under 1.5 million shares, or about 18 percent of the company. On the open market the block was worth S30 million, but a single purchaser buying directly from the owners would be expected to pay a premium. The amount of the investment did not faze Goldsmith. He told
Hirschfield
that he would speak to the All
ens, whom he had known for a number of years, on his next trip to New York. - Hirschfield had not had such a cordial and hopeful meeting with anyone in weeks, and he was optimistic when he returned to Claridge's. His mood at dinner with close friends that evening, and in Paris over the weekend, was brighter than it had been in weeks—perhaps since the Tuesday before Thanksgiving in Los Angeles when he and Berte had dined at Ma Maison and toasted the firing of David
Begelman
. - In his suite at the Plaza Athenee
late Sunday morning,
Hirschfield
met with one of his closest European business acquaintances, David Karr. A shadowy, controversial figure, David Karr had made a fortune in recent years acting as the broker in b
usiness deals between the
Soviet Union and various corporations in the United States, Europe, and Japan. The fifty-eight-year-old Brooklyn native had worked in the United States as a newspaperman, theatrical producer, public relations man, and hotel manager before moving to Paris in the early sixties. When Allen & Company posted Alan Hirschfield to Paris to establish an office there, he got acquainted with Karr, who
then owned both the Plaza Athe
nee and Georges V hotels. At one time the two men considered going into business together. - David Karr was friendly with a number of leading Democratic politicians in the United States—Edward Kennedy, John Tunney, Alan Cranston, Sargent Shriver, Henry Jackson, and Jen
n
y Brown, among others—and occasionally acted as an informal and secret liaison between the Soviet and U.S. governments on issues such as arms limitation and the emigration of Soviet Jews. - Karr also did business occasionally with Jimmy Goldsmith. He knew of Goldsmith's interest in the motion-picture business, and coincidentally, just before Ira Harris had placed Hirschfield in touch with Goldsmith, David Karr had telephoned former Senator John Tunney to ask about investment opportunities in Hollywood. Having lost his 1976 bid for re
-
election to the Senate, Tunney had been practicing law and doing business in Los Angeles, and had excellent contacts in the film community. Among the people John Tunney contacted on Karr's behalf wa
s Herbert Allen, with whom Tunne
y had been very friendly since Allen had contributed to his 1970 Senate campaign. Tunney was generally familiar with the Begelman trouble at Columbia Pict
ures and thought perhaps the All
ens' interest, or even the whole company, might be for sale. Herbert assured him (hat it was not, and after making a few
more inquiries, Tunne
y reported back to David Karr that there did not appear to be any current opportunities for Jimmy Goldsmith in the motion-picture business in America. - Karr was quite surprised, therefore, when he learned on Sunday, December 18, in Alan Hirschfield's Paris hotel suite of
Hirschfield
's meeting with Jimmy Goldsmith less than forty-eight hours earlier. Actually, Karr had heard a rumor about the meeting before seeing Hirschfield. - On Monday. David
Karr again telephoned John Tunne
y in Los Angeles. - "Did you know," he asked Tunney, "that Alan Hirschfield is over here talking to Jimmy Goldsmith about buying Columbia Pictures'?"
- "You must be kidding," Tunney replied. "No, he met with Jimmy on Friday in London, and I talked to Alan here over the weekend."
- "I can't believe it."
- "This must be kept confidential."
- "Of course," Tunney said, "but I
do feel obliged to tell Herbie Allen because of our previous inquiry." - Tunn
ey called Allen in New York. "Herbie
, you won't believe what I
just found out!" - "What?"
- "Alan Hirschfield is in Europe trying to sell Columbia Pictures to Jimmy Goldsmith!"
- As information on
Hirschfield
's secret negotiations with Goldsmith was being flashed quietly from Paris to Los Angeles and back to New York that Monday, Columbia was disseminating a press release about the return of David
Begelman
. - for immediate release
- New York
(December 19, 1977)—Columbia Pictures Industries Inc. announced today that David
Begelman
has been rein-slated as President of its Motion Picture and Television Divisions. Mr.
Begelman
has been on a leave of absence since September 30, 1977, pending completion of an investigation by the Audit Committee of the Board of Directors into a number of unauthorized transactions involving Mr. Begelman and the Company. The investigation established that in a number of separate and unrelated transactions from January 1975 to May 1977, Mr.
Begelman
obtained through improper means corporate funds in the amount of $61,008 for his personal benefit, and that the emotional problems which prompted these acts, coupled with ongoing therapy, will not impair his continuing effectiveness as an executive.
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