Last updated on November 3rd, 2021 at 07:59 am

My Rating: 9 of 10

Summary

Fascinating, thorough history on CAA, one of the big four talent agencies in Hollywood and in the 90s, the only agency that mattered.

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Notes

Introduction to CAA

In recent years, rivals have taken it hard to CAA. There is particular irony in WME’s ascendance, both because it was William Morris from which the founders of CAA fled, spending the next two decades grinding their former employer to near dust; and also because Endeavor, which merged with William Morris to create the new titan, was founded by agents who fled CAA during or shortly after its golden years. No one can say the retreats are tossed together at the last minute; planning for each retreat begins fifteen minutes after the current one ends and includes weighty retrospective analysis on what worked and what didn’t. For the anniversary retreat, retrospection went back even further—all the way to the agency’s founding.

Forty years of CAA history can be conveniently divided into halves that represent two eras of leadership. The first two decades from 1975 to 1995 are known around CAA as “1.0,” and the second two, from 1995 to 2015, as “2.0.” In recent times, some insiders have taken to calling the years 2010 and beyond “3.0,” because 2010 was the year that private equity giant TPG invested heavily in CAA and soon became its majority owner, with 53 percent of the company in its portfolio.

For the first twenty years, the company was run by now-fabled original founders Bill Haber, Ron Meyer, Michael Ovitz, Rowland Perkins, and Michael Rosenfeld. Each was a pioneer in his own way, jettisoning the rules of the ossifying agency trade as the firm grew from tiny start-up to industry dominator.

Ovitz was undoubtedly the most indomitable of the Founding Five—and, during the late ’80s and early ’90s, the most fearsome—but Meyer was equally indispensable. Let’s get this out of the way right now: If, instead of a Mike and a Ron, there had been two Mike Ovitzes, CAA would likely not have become the phenomenon that it did; and if instead of Ron and Mike, there had been two Rons, likewise. The agency needed Ovitz’s drive, gumption, and unbridled aggressiveness, but it would likely have been a calculatingly impersonal place without the legion of loyalty that surrounded Meyer, not to mention the invaluable mentoring he did with other agents in which he extolled the art of service businesses.

Ovitz was brains and science; Meyer was heart and culture. Theirs was a much-envied balancing act for the first twenty years of the company’s existence. Then, exactly midway through its life—1995, the most precarious point—CAA went through a kind of thrombosis, a disturbance in the force if you will, that saw the departures of Meyer, Ovitz, and Haber (Rosenfeld had left in the early ’80s, Perkins in the early ’90s).

When the music stopped, the agency once again had five at the helm: Kevin Huvane, Bryan Lourd, Lovett, Jay Moloney, and David O’Connor. Eventually, a shocking suicide and several secret rounds of corporate infighting would leave only a trio.

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Hollywood History

In 1925, there were fewer than twelve agencies listed in Hollywood directories, so one could almost empathize with Clara Bow, nationally famous “It” girl, and her professional suffering. Like other actors in pretalkie times, Bow seemed to be on a trajectory toward auspicious stardom, or at least marketable adorability, but also like most actors, she was a resounding flop at managing her own business—that is, the business of herself.

No sooner had Bow ascended to “It-ness” in 1926 than she naively signed a contract with Paramount that became a textbook case in stars failing to benefit from their own popularity. The contract paid her less than a third of what comparable performers were earning, and after it expired, it was too late for her to find financial success anywhere. She never attained the heights predicted, and her moment of financial leverage had been wasted.

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In the 1950s, Lew Wasserman transformed the talent agency MCA into a “packager” that would approach studios with already assembled teams of directors, actors, and writers. With this, Hollywood saw the birth of a new species—film stars who were also independent contractors, with the textbook case being Jimmy Stewart.

The star of Harvey and many other iconic hits saw his wealth multiply with a single role in Universal’s Winchester ’73. By forgoing a standard salary and taking profit participation instead, Stewart paved the way for actors, directors, producers, and writers to leverage their celebrity at the negotiating table. Similarly, Wasserman cofounded independent production companies for such luminaries as Jack Benny, Alfred Hitchcock, Errol Flynn, and dozens of other MCA clients, allowing them to minimize taxes while exploiting their star salaries and expanding their influence in movie production.

As anyone could have predicted, it was the stars, in particular the television “personalities,” who held sway over the American public’s imagination and affection. (Not for nothing was Shower of Stars the title of a typical drama anthology; the title Shower of Directors was likely never considered.) The power of TV was such that a “nobody” could become, virtually overnight, more famous than some venerable holdover from the studio system. Indeed, stardom in movies became less and less bankable as TV created its own sensations. At the same time, major movie stars like Bing Crosby, Frank Sinatra, the independent Mr. Stewart, and many others piloted shows built around them that often then ignominiously flopped. Orson Welles shot a pilot that never even made it to series. Not all stumbled, but television could tame even the biggest egos, with the little screen outgunning the “silver screen” time after time.

In 1962, MCA’s dominating presence in Hollywood ran smack into the Department of Justice. Its investigation into the company’s “monopolistic practices” resulted in a face-off between Wasserman (whose beloved allies included Ronald Reagan, then in the midst of leaving the Democratic Party and becoming a Republican) and Attorney General Robert F. Kennedy Jr. To avoid criminal and civil penalties for alleged antitrust violations, MCA agreed to divest itself of its talent agency at the same time that the company bought struggling Universal Pictures and Decca Records. Just like that, MCA quit the talent business and created the largest entertainment assembly line in Hollywood. Building on its library of detective shows, westerns, sitcoms, and specials, MCA and Wasserman transformed moribund Universal Pictures into grandiose Universal Studios, owners of the largest and busiest lot in Hollywood. When MCA departed the representation business, the move solidified William Morris as the agency. It had the biggest star clients and the greatest influence on the studios and networks. But perhaps more relevant to this story was the common belief that if you were young and wanted to get the strongest start possible for a career in the entertainment industry, it was the place to be. LOCATION: 462

The Beginning of CAA

MICHAEL OVITZ: I was student body president for a high school of four thousand students. I was also president of my fraternity at UCLA and dedicated myself to being very well organized. I had a huge appetite for getting deeply involved in everything that interested me. In college, I went to work as a tour guide at Universal. There were ten of us—five guys and five women. I soon got hired away by a guy who went to work at Fox helping design their tours, so while I was going to school at UCLA, I was also working full-time at Fox. I didn’t go to most classes in the beginning of the semester, but I’d always go to the final exams. I did that for three years, and in my senior year, I decided I wanted to start looking for a job after school. I interviewed at William Morris and CMA, an advertising agency. William Morris responded the quickest. During the interview, the personnel director at William Morris asked me, “Why do you think you should get this job? There are twenty people in the mailroom, and lots more who want to get in there.” And I said, “I can learn everything there is to know about being an agent in ninety days, or I’ll give you back all the money you pay me.” I knew it was an outrageous and stupid statement, but he couldn’t stop laughing. Then he said, “I’m going to hire you.”

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MICHAEL OVITZ: I made an assessment of what holes there were that I could fill as a young guy. What was open that no one had touched? When I went through all the William Morris network sales, most were prime time. There were few dayparts and little syndication. Then I was at a meeting at ABC and found out the network’s margins in other dayparts were four and a half times those in prime time, because programming was cheaper. I was in a state of shock. So I started developing clients in that area. I signed a guy named Bill Carruthers who was a daytime director and Jim Young, who did General Hospital. I put this whole coterie together. I became very interested in packaging—putting things together rather than just individually handling clients, which turned out to be the base of CAA.

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RON MEYER: Shortly after the Chianti dinner, three other agents—Rowland Perkins, Mike Rosenfeld, and Bill Haber—approached me. Bill was my boss, and Rowland was his boss. Mike and Rowland were senior agents: Rowland in television, Mike in motion pictures. They told me they were also thinking of leaving because of Phil’s departure and asked if I would be interested in joining them. I said, I might be, but only if Mike Ovitz was part of it. They didn’t know Mike very well, so I said, “Why don’t the five of us sit and meet?” I wanted to see what they were going to do, and to make sure they didn’t leave before us or screw up our plan. Howard West was a very close friend from William Morris, and Mike and I had a lot of respect for him. We had stayed in touch with him after he left the agency to become a manager, and then we asked him whether the two of us should go it alone or join the other three. HOWARD WEST: I digested the question, then said, “Guys, the industry is ripe for competition. It will embrace you because everyone is tired of the William Morris dominance.”

NOTE: Interesting that it sounds like Mike obits was the youngest amongst all of them and most junior yet he is the one who rose to the top.

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ROWLAND PERKINS: It was January 7, 1975. I got back from lunch and the phone rang. It was Sam Weisbord, who says to me, “Are you free for a walk?” He used to walk as part of his regimen around the neighborhood of William Morris and I said, “Sure.” RON MEYER: I happened to be home that day with the flu. ROWLAND PERKINS: Sam and I started walking, and when we got about two blocks away, he very casually said, “It’s come to my attention that you and Haber and Meyer and Ovitz are planning on leaving, is that true?” And the only lie I ever told him was “I can’t speak for the others, but for me it’s true.” He stopped dead in his tracks. He was a short guy and I’m six feet. He looked up at me and got as close as possible without making contact, and said, “You have committed treason,” then turned and took off for the office. I followed him, and soon as I got in my office I called Ron Meyer at home and told him what had happened. He said, “Okay,” and hung up. Then I called Bill Haber and Mike Rosenfeld and told them the same thing. Mike Rosenfeld was a good man and came into Sam’s office to personally tell him he was leaving, but Sam just threw him out. Then Bill Haber went over to Sam, hit him on the shoulder, and said, “Hey, Sam, isn’t this a riot?” and proceeded to tell Sam why the five of us were going to try it on our own. Bill just stood there and laughed while Sam sat frozen with his mouth open. BILL HABER: Sam was not pleased. The conversation didn’t take long at all. MICHAEL OVITZ: I had taken a rare break and had gone skiing. When I got back to my house, Mike Rosenfeld had put a note on my door that said, “You’re no longer working at William Morris. Call me.” FRED WESTHEIMER: I walked into Sam’s office and there were maybe five or six executives there and they said, “Why are you leaving?” I said, “I’m not.” They had just assumed I was part of the group. MICHAEL OVITZ: Sam Weisbord loved Judy and he loved me, but he looked at me and said, “You’ve really screwed yourself this time.” That’s what he said to me. I learned an amazing lesson from that moment. If he’d started that meeting differently, attempted to check his ego at the door, told me he didn’t want to lose me, and then offered me an insane amount of money, there was at least one chance in a thousand I would have stayed. Instead, he did me a favor, because instead of being compassionate or even making me feel guilty, he pissed me off. He attacked me and tried to belittle me. There was no way I was going to stay. After that meeting, Ron and I packed up our things. Rowland, Bill, and Mike had company cars they had to turn in—Ron and I didn’t—so we drove the five of us to Rowland’s house. RON MEYER: Here’s the truth: If we had actually stayed for another year at William Morris like we had planned, and during that time, Sam Weisbord had come to me and said, “All is forgiven,” I may have actually stayed. There was no way for us to understand whether our leaving was actually going to be real…

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RON MEYER: The one client I had who I was positive was going to come with me was Jack Weston, a well-known character actor. He was my most important client at William Morris, and he had literally said to me, “I’m with you forever.” In those days, he was probably making a couple hundred thousand a year, so we thought we could at least count on twenty thousand a year in commissions, which was a huge amount of money for us. Just as we were starting out, he was in a play in New York called Steambath, and we all had to pitch in for me to fly back to be with him on opening night. I saw him, we had a great time after the play, then I flew back. Waiting for me was a letter that had been mailed several days before from him telling me he had decided to stay at William Morris. When I asked him why he didn’t tell me anything when he saw me, he said he just didn’t feel comfortable talking about it in person. I was humiliated, embarrassed, and very pissed off. This was a huge setback for us, to the point where if we had known earlier he wouldn’t be coming with us, who knows, we might not have been so eager to leave. Years later, a friend of his approached me on his behalf and asked me if I would represent him. I said, “Tell him he can go fuck himself. Not if he was the last client on earth.”

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MICHAEL OVITZ: Our overhead may have been low, but our expenses were incredibly high. All of us were having every meal at restaurants with executives, clients, and potential clients. We were trying to keep things as inexpensive as possible, including staying away from high-priced meals. But then there was the dinner that Rowland put together with Joseph Bologna and Renée Taylor at a very expensive restaurant in Century City. They were hot writers and we wanted them as clients. We all brought our wives, so it was a table for twelve, which was going to be a fortune. RON MEYER: Before Joe and Renée arrived, Bill and I said to Rowland, “They picked this place, so maybe they are taking us. Whatever you do, don’t reach for the check.” JUDY OVITZ: We were hoping that because he was a regular there, the waiter would give the check to Joe Bologna. MICHAEL OVITZ: It turned out, Renée and Joe hadn’t come for a cordial dinner. We had never seen anything like it. She drew a line across the table and said, “This is Joe and me against you.” She was really combative. At one point, Bill just said, “What do you mean? We just want to work with you.” RON MEYER: The check was put in front of Joe Bologna and he just kept looking at it but never addressed it. MICHAEL OVITZ: His arm never moved. He just kept smoking a cigar, which he had also charged to the bill. JUDY OVITZ: So then Rowland’s wife, Diane, takes the check and gives it to Rowland. I was like, Oh my God. Rowland was horrified. I think that destroyed their marriage then and there. It was the beginning of the end for them. MICHAEL OVITZ: Rowland gives it to Mike Rosenfeld under the table, but Mike hadn’t brought his credit card. No one had a credit card except for me, so I took care of it. This was 1975, and the bill was $2,000 and we had no money. It took us two months to get our first commission check—it was something like $950. We framed it and put it on the wall.

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BILL HABER: Six months into the company, I sat with my wife at a place called the Swiss Echo, which is no longer on Pico Boulevard and Overland, and I laid out in front of her $5,000 in hundred-dollar bills, and I said, “This is our first money from CAA.” MICHAEL OVITZ: Every dime we made went back to the business. I sold a daytime television show called The Girl in My Life, and that paid us like $1,000 a week, which covered our rent and phones. Then someone sold a $100,000 TV movie and we got $10,000. We were barely making it. At the time, we didn’t even have expense accounts; we were paying our own expenses and deducting them on our tax returns. JUDY OVITZ: Thank goodness we didn’t have any kids at that time. We were lucky, we only had dogs.

NOTE: Sometimes you have to go hungry in order to be aggressively hunting

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The agency’s main source of revenue was the modestly successful Rich Little game show Rhyme and Reason, which ran for about a year. By the end of 1975, the company’s $2.5 million revenues left each partner a tidy sum of $25,000, but they took no salary and used revenues to pay for overhead and expansion. Revenue was limited to game-show package commissions and some TV bookings. There were no profits.

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BILL HABER: My job was to put television series on the air that we packaged and to collect a package commission, but in those early days, we were all doing everything we could to get our names out there and find out what was important for our business. SHERRY LANSING, Executive and Producer: In 1975, I was the executive story editor at MGM, which meant I bought material to make into movies. So this guy named Bill Haber calls and says, “I’d like to go through the release schedule so I know what’s going on.” I said, “Great, Susan Merzbach does that for everybody, so I’ll set up a time for her to meet with you.” And he said, “I don’t want to be treated like everybody.” I told him, “No, no, I didn’t mean to offend you. I just meant she has all the information, and it’s more efficient, but I will give it to you now if you want.” He said, “I’m not offended, and now I don’t even want the release schedule, I’m just going to shower you with gifts.” Then he started to laugh and said, “Bye.” The next day, fifty shower caps were delivered to my office. I called him to say that was really funny, but he wouldn’t take my call. The next day, fifty boxes of Morton Salts with the little girl and her umbrella were delivered. The next day, I got a bunch of umbrellas. I was laughing every day because it was all so original, and for ten days I received all these funny presents. Susan and I said, this has got to stop; I couldn’t even get into my office because of all the stuff that had been sent. So we hired an actor and said, “Put lots of soap in your hair and a towel around you, and go to his office and say, ‘The girls throw in the towel,’ and throw the towel on Haber’s desk.” The actor goes to CAA with a towel wrapped around him, and of course the receptionist won’t let him through, but the actor was so determined to do his job that he stormed past the door and goes into a conference room where Bill and Mike Ovitz were sitting with a client they were trying to sign. The actor runs in, throws off the towel, and exclaims, “The girls throw in the towel!” And he was stark naked underneath! We thought he would have a bathing suit on. The client looked at him and said, “Wow, this is the coolest place in the world,” and signed with the agency. Bill Haber called me and said, “You two are amazing! We must celebrate!” So he picks a night Susan and I are free and tells us to wait at the MGM gate. This huge stretch limo pulls up and the driver rolls out a red carpet and a man with a violin starts playing as he motions for us to get in. I was making $30,000 a year and had never been in a limo in my life. There was a chilled bottle of champagne inside waiting for us. We knew we were having dinner, but we didn’t know where and the driver wouldn’t tell us. Then the limo pulls up to the airport, and Susan and I are asking ourselves, What is going on? The door opens and the man helping me out of the car says, “Hello, I’m Bill Haber.” I had never met him. I said, “Bill, this is crazy…

LOCATION: 1076

Since all five of the agency’s founders had worked in William Morris’s television department, most of the agency’s clients in the beginning were television actors rather than the highly sought after movie stars who would become CAA’s future bread and butter. During their time at William Morris, the CAA founders had objected to WM’s television packaging fee of 10 percent of the budget, believing it was “too rich” and “people couldn’t afford it.” CAA slashed it to 6 percent, and, according to Ovitz, “it increased the volume of our business so we wound up making far more than if we had charged the higher rate.” MICHAEL OVITZ: Bill and Mike came up with the idea of cutting commissions from 10 percent to 6 percent.

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RUSTY LEMORANDE: Ovitz would never say who he was on the phone—not even “Hi, it’s Mike.” He would just say, “Is he in?” You had to recognize his voice, and we jumped like it was God calling, because we knew that Mike had that authority over you. Marty jumped, too—more for Mike Ovitz than any of his important clients. I always thought that was interesting. Marty had so much more experience than Mike; Marty had been brought in on a pedestal; Mike really turned to Marty for advice on how to handle film deals and, more important, big powerful superstars; and Mike was a kid compared to Marty. Yet Marty was in awe of Ovitz.

LOCATION: 1258

RON MEYER: We had a lot of clients who were booking episodic television with guest shots. In those days they probably paid $1,500 or $2,500 for a guest shot on a Quinn-Martin show, or The Fugitive, and we depended on a lot of that. When you book something for $2,500, your commission is $250, and even though every penny was always important to us, and the appearances were important to the clients, I realized we should get out of the episodic television business so we could concentrate on the series business and the Movie-of-the-Week business. There was a real robust Movie-of-the-Week business back then, paying actors $25,000 or $30,000 for a two-hour movie. There was money to be made for a certain caliber of talent. This was a big turning point for us, but it meant we weren’t going to be able to represent a lot of clients who depended on us just for episodic appearances.

NOTE: Not all opps are equal. Chase the big ones

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MICHAEL OVITZ: On the board downstairs at 1888, I saw the name of the law firm Armstrong & Hendler. We were on the fourteenth floor—which by the way was really thirteen, which was my lucky number—and they were on eighteen and I went up and introduced myself to Gary Hendler and discovered that he had taken with him almost every major movie star in the business from his former firm Irell & Manella, which specialized in taxes. I spent a year cultivating a relationship with Gary, taking him to lunches, to dinners, sending him gifts. I remember I found out he loved chocolate—I sent a barrel of Hershey’s Kisses, anything I could do to ingratiate us to him. He was very smart, a Harvard graduate, in his thirties when I met him, but he had every movie star you could think of—Redford, Streisand, Richard Dreyfuss, Sydney Pollack, and Sean Connery. Gary Hendler’s client list would prove to be one of the most important vehicles for upgrading CAA’s talent list over the coming decade.

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MICHAEL OVITZ: In the course of getting friendly with Gary Hendler, it became very clear to me that Barry Hirsch was very unhappy at his firm. He kept complaining that there were problems in the partnership and that he couldn’t get anything done. It was a Friday afternoon and he had gone on and on and on about it, and I happened to leave him and go to dinner with Gary Hendler and his wife. And Gary complained how unhappy he was because he didn’t have enough manpower. He didn’t have a real equal partner because his partner was not an expert in the entertainment industry, he was just a guy who handled corporate work. So I pitched Barry Hirsch to him, and he responded well immediately. I then called Barry Hirsch and I pitched him Gary Hendler. I arranged for them to have a breakfast Saturday morning at a deli and I went and introduced them, then I left. They talked for three hours, shook hands, and agreed to merge. In two weeks, they put together a firm called Armstrong, Hendler, & Hirsch and overnight basically controlled the legal side of the entertainment business. CAA ended up having two hundred clients with them.

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There were less than a dozen agents when my dad went over there, and he had to wear many hats. They didn’t have enough clients for him just to be a business affairs guy, so he became the guy who was taking care of things in the office while those guys were out signing people. As a lawyer, he was trying to see what problems might occur and implement ways to avoid them. Even though Mike and Ron wanted the final say on most things, my dad really spent the bulk of his time building the infrastructure of the agency. He understood what Mike’s agenda was, but he also knew he was going to be the one to create what was necessary for that to happen.

NOTE: Need to do the sexy stuff like signing and also set up infrastructure

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stayed close with our agents and always knew what was going on with them. This meant, for instance, if important writer clients wrote an unattached script, rather than sell it directly to a studio, we would put it together with a director and in some cases an actor or an actress, then sell it at a premium. Although we didn’t invent it, we did it very effectively and became known as a very strong packaging agency.

NOTE: Very similar to David Schwartz’s idea of the real estate agent who would give them the ideas of how to use plots of land. Add value charge a premium.

LOCATION: 1545

want to deal with CAA after years of dealing with the other guys? Because you couldn’t ask William Morris or ICM to peddle rights without actually contacting William Morris or ICM, which meant those agents would be exposing their authors to their competitors. CAA in effect branded itself as a safe harbor. They just wanted to help those author-clients get their books made into TV shows and movies, not to snatch literary clients for themselves. Thus did CAA get into the book business—without getting into the book business.

LOCATION: 1589

The Mort Janklow Story

It actually started back sometime in 1975. My secretary said, “There’s a man on the phone named Michael Ovitz, from California, do you know him?” and I said no, so she said she’d get rid of him. But she came back a few minutes later and said, “He’s an agent in Los Angeles and he’d very much like to talk to you.” I’m not that hard to reach, so I picked up the phone. He said, “I will make this short. Five of us have left William Morris to set up our own shop. We’re called Creative Artists Agency. Now I don’t want to fool you, we’re operating on bridge tables in empty space we’ve rented, with our wives manning the phones.” And then he said, “I’m going to build the biggest agency the world has ever seen in ten years.” That was his opening. So I said to myself, Oh my God, another Hollywood type. He said, “I’d like to come and see you, but only for a half hour.” Then he said, “And I’m only coming to see you.” I said, “Well, I’m flattered, come on in,” and we made a date for the following week. So he came in, walked into my office, pulled out a watch and put it on the desk in front of him, and pitched me for a half hour on what they could do for us. Basically, his idea was that even though we controlled a number of big writers at the time, and a lot of these books were being turned into films, we didn’t know that ground as well as we knew the literary biz. I asked him, “What could you do for us? We’ve sold a number of big projects ourselves.” He said, “If it’s a huge project, it sells itself, but if it’s just a good book, we can put you together with the right people and make more complete deals.” I said, “Well, it was nice meeting with you, Michael. I’ve learned a little and we’ll be in touch.” He said, “This is what I thought would happen; I didn’t expect much until you knew us better. How about this? Can I call you every Thursday at ten o’clock your time?” I said, “Sure,” and thought I’d never hear from him again. The following Thursday, the phone rang at exactly ten o’clock and it was Mike Ovitz asking, “Got anything for me to talk about?” I said, “No, Michael,” and he just said, “Okay, Mort, good-bye.” The call was fifteen seconds. No wasted time. MICHAEL OVITZ: I went to see Mort in New York and said, “Look, we’re going to change the way business is done and we want your books. We won’t take your books and we won’t charge you anything. We’ll give you all of the commission; we just want to be able to put packages together with our clients.” But he wouldn’t do it. So I asked if I could call him once a week on Thursdays at 10:00 A.M. He probably figured, What a bullshit artist, but said fine. For fifty weeks every Thursday, at 10:00 A.M. Eastern, no matter where I was—you could set your clock by it—I called him.

NOTE: Tenacity. Finding a way into a business

LOCATION: 1596

you, but it’s a wounded bird. Everybody has seen it before it came on the scene. I’d made a deal with the Mobil group to make it into a television series, and they bought it but they don’t know what to do with it; they can’t make it, so they’ve just turned around and given it back to me.” He said, “Put it in the dispatch bag and get it to me right away.” MICHAEL OVITZ: Finally, Mort said, “Okay, I’ll give you a book.” I gave it to several people in the office and then Bill said to me, “This book has been around and passed on.” I said, “I think it has, too, but who cares.” Bill said, “I agree. I’m going to try and put it together.” And to his credit, Bill made Chiefs happen. When I called Mort to tell him the book was getting made as a miniseries and asked him how he wanted us to handle the deal, he shit a brick.

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Stories

RON MEYER: A few years after we started the company, Mike and I had what we used to jokingly call “our walk in Central Park.” We were in New York and went for a long walk and he told me, “I feel like I’m carrying most of the weight here; I’ve got the most important clients; and I’m the face of this company.” And I have to say, at the time, that was all true. MICHAEL OVITZ: I remember that walk like it was yesterday. That conversation was me telling Ron that I was really concerned that I was going to get stuck not being able to make the kind of leveraged economics that I wanted to, but he just kept going after Bill. He said he didn’t like the way Bill behaved, he was upset Bill used to take off Thursdays to go to Paris every other week, and that he and I were the only ones working seven days a week. For me, that conversation wasn’t about me leaving or threatening to leave. It was how we calculated the money. It was the split. RON MEYER: Then Mike said, “I need to be the president of this company and have the ultimate say in its future.” He also said he wanted to divide the shares of the company up differently, with him getting more shares than us. He made it clear that if that didn’t happen, he would probably leave and do something on his own. I supported his position for two reasons: first, I felt that he was probably right in wanting to be in charge—we couldn’t keep having everybody voting on everything—and second, we were all better together than we would be apart. For our future and the future of the company, I knew I had to make this happen. So I went back to Bill, Mike, and Rowland.

LOCATION: 1687

ROBERT KAMEN, Writer: I sold my first script to Warner Bros., and because it became attached to an Academy Award–winning actor in the form of Richard Dreyfuss, it got a little bit of buzz. As the new hot young writer in town, I got passed around to various people at studios, including Jeffrey Katzenberg, who was a junior VP at Paramount. We hit it off, and he said to me, “What do you want out of this business?” I told him, “I’d like to be a major writer.” He said, “You can’t be a major writer unless you have an agent,” and he sets up five appointments for me. The first one is with Michael Ovitz and Steve Roth at CAA. I tell them this idea I have, and Michael Ovitz gets up and leaves the room. I said to myself, That is pretty fucking rude. Then he comes back after a few minutes and says, “Okay, you in a room with Jane Fonda and Bruce Gilbert.” Now Jane Fonda had just finished China Syndrome and was a big deal, and Bruce was her producer. I said, “Look. I don’t care if you lie for me; I just don’t want you to lie to me.” At that, Michael Ovitz gets up and as he’s walking to the door, delivers one of the classic lines of all time. He says, “I never lie,” and he walks out. I went back to my hotel, and told my best friend Erwin Stoff, who is now one of the principals of 3 Arts Entertainment, “If this fucking guy is lying to me, if I show up tomorrow at 10:00 A.M. and Jane Fonda’s not in that room, I’m going to knock his fucking teeth out.” I showed up the next morning at 10:00 A.M. and there’s Steve Roth, there’s Mike Ovitz, and there’s fucking Jane Fonda and Bruce Gilbert. She looks at me and says, “I commit.” Then I look at Ovitz and say, “You walk on water, right?” Michael and Steve took me to five studios, and the last meeting was with Frank Price at his magnificent home that Dinah Shore used to live in. It was Rosh Hashanah eve, but Frank is the quintessential goy; he’s descended from Aaron Burr, for crissakes. I tell him the story and he says to Michael, “You’re not leaving here until you tell me I have the package.” Michael says, “Yes. You have the package. Jane will do the movie with you.” Little did I know that Mike and Frank were in collusion. So Mike drives me right from Frank’s house to the airport and says, “Talk to nobody. I will call you.” Then he zooms off in his Jaguar with the CAA license plate. I go home to Colorado with my head spinning. Four days later, I get a call at 8:30 in the morning from my book agent, Ginger Barber, in New York. I had just sold a novel to Simon & Schuster the same day I had sold that first screenplay. Ginger says, “What’s My Brother’s Keeper?” I really had told nobody about this. So I asked, “Why?” She says, “You’re on the front page of the New York Times.” I said, “What?!” Then she reads me an article about the Hollywood dream but really it’s an article about Mike Ovitz and Frank Price and the headine is UNKNOWN SCREENWRITER HITS IT BIG. The article said Mike Ovitz sold the screenplay for $350,000 and…

LOCATION: 1868

Urban Cowboy was iconic, and unique in so many ways. I read Aaron Latham’s piece in Esquire and used it to sell a package to Diller and Eisner at Paramount. We got a go movie and there wasn’t even a script! We had Irving Azoff, James Bridges, and Bob Evans attached. I was also able to separate the music part of it because Paramount didn’t have its own record label. That record album became its own huge profit center, and as a result, changed the business of packaging. CAA had a piece of the movie and the album, and both did really, really well.

NOTE: Always find new ways to create deals

LOCATION: 1902

BARRY HIRSCH: To Michael’s credit, he was the first agent, at least that I was aware of, that embraced lawyers insofar as being part of the original dealmaking process. I think historically lawyers, especially with agents at the William Morris office and a couple of the other agencies at the time, were looked upon as people who caught paper and went over the paper. Most agents trained in those days were really trained to go over contracts. Michael realized that by getting the lawyer involved in the beginning, he could accomplish several things: One, he would nourish the relationship with the lawyer. Two, he realized that a lawyer might make the deal even better, which would then increase his commission. Three, having the lawyer involved protected him against the lawyer telling the client, “Why did Michael do this when I could have done better than that?” And finally, if the lawyer was involved early on, he wouldn’t have to waste his time being involved in secondary negotiable points as well as boilerplate points, which meant he could jump off and move on to do another deal. To my knowledge, he was the first contemporary agent that embraced the lawyer like that.

NOTE: Make the deal, be able to move on

LOCATION: 1915

JUDY HOFFLUND: Ron was very hard to work for—very demanding, very specific—but he taught me things that I carry with me to this day, like you have to return every phone call every day. Even now, I lie in bed feeling guilty if I don’t return someone’s call, and I’m not even working anymore.

LOCATION: 2185

SYLVESTER STALLONE: I was about to enter into a film called First Blood, and even though I hadn’t gone with him yet, Ron and I talked about it quite a bit. This is an interesting story, and will give you a little insight into Ron Meyer. My managers at the time were not thrilled by the idea of my bringing Ron on. They said, “You don’t need him, you don’t need him, he’s just there for the money. CAA needs money; nobody’s going with them.” I told them what was happening at the agency wasn’t my concern, and that I liked his personality and thought he was very sincere. I remember him telling me, “All I can say is I’m the best of the worst kind of breed in the world.” I kept being asked by my representatives to stay away from Ron Meyer. They told me, if you offer him money on it, even though he doesn’t deserve it, he’ll take it. Now, put this in perspective. I was doing First Blood and was going to be paid around five million. So it would be a pretty great commission for someone who had nothing to do with the deal itself and had only talked to me about the movie’s ending. But I really liked the guy, and he had been really supportive through all those discussions on the ending. So I decided to test him. I called him and had one of my representatives listen in, but Ron didn’t know anyone else was listening. I said, “Ron, I know you all could use a little financial boost, so I’d like to give you ten percent commission on First Blood right now.” He said to me, “Wow, that’s incredibly generous, and I’m not going to lie, I could use it, just let me think . . .” And there was a couple seconds of silence. Then he said, “Thank you very much, Sly, but I’m going to pass on that. I hope there will be other movies where I will have earned my fee, and I get a chance to work with you in the near future. Hopefully, I’ll see you down the road.” I hung up, looked at the other person who had been listening in, and they almost burst into flames from embarrassment. That was literally the ultimate world-class litmus test, because I don’t think anyone else would have passed on half a million dollars when they were desperate for cash. But he did, and that was the official beginning of me and Ron Meyer.

LOCATION: 2258

Michael Rosenfeld left CAA in 1982, becoming the first of the original founders to depart the agency. Under the original buy-sell agreement made by those founders in the first weeks of the company’s existence—and based on a zero valuation of the company—Rosenfeld was paid $750,000. Rosenfeld had worked hard at William Morris and was a key ingredient of CAA in its formative years. What he brought to the operation was not just skill but soul, often serving as peacemaker when necessary among the original five. He was also, as all the partners knew well, a man obsessed with death, having lost his father when the “old man” was only in his 50s. Rosenfeld was a big fan of television and movies and a voracious reader with impeccable taste when it came to judging talent, but from the time the agency was formed, it was clear that no one would be able to keep up the pace that Ovitz and Meyer had set. They gave their entire lives to the agency; Haber put in seemingly thousands of hours, but kept perspective, while Rosenfeld, along with Perkins, simply wasn’t going to let his work define his entire life. He may have known so well that he couldn’t keep up with Ovitz and Meyer that he wisely didn’t even try. There were many nights when Ovitz and Meyer would be leaving the office at seven to go to clients’ dinners and premieres and saw Rosenfeld also leaving the office but going home to his wife and two children. Even during daylight hours, he loved to escape whenever possible to pilot his airplanes, an exercise not without its element of symbolism. Rosenfeld saw the business becoming more and more demanding, especially when one was a partner in the agency. He was the sole architect of his own departure, and missed by many.

LOCATION: 2371

The Agents

ERIC CARLSON: I never went onto a desk. I came out of the mailroom and went straight to being an agent. I think I’m the only guy who’s ever done that. What happened was while I was in the mailroom, I wrote a study on all the emerging television markets. It took me three months and was like a thesis. I bound it with all the partners’ names on it, then personally handed it to each of them. I said it was a reference guide and included thoughts I had on what we should be doing in the future. Ovitz asked me why I wrote it, and I said, “Because I’m too smart to be in the mailroom; I should be an agent.” A few days later, Ray Kurtzman pulled me aside and told me Michael thought I had balls for doing what I did. It reminded him of what he did at William Morris: never accept no for an answer. Michael promoted me out of the mailroom to agent a month later.

TONY KRANTZ: In the training program, I had written a paper that was a hundred-page document about CAA and the music business, because CAA was not in the music business at the time. My vision was not to get into the booking of bands because I really didn’t love that business, having been the concert promoter at Berkeley; it was really about a different vision, about taking brilliant musical talent and moving them into film and television—say, Quincy Jones producing a movie, a Broadway musical starring Prince, having Ricki Lee Jones score a movie, having Elvis Costello write and produce a movie, taking advantage of CAA’s core strengths and bringing music people into the fold into this new kind of music/film/television programming that I really loved. Fred Specktor was my mentor and sort of supervised the writing of this document. It was, in many ways, the artistic dream of a twenty-two-year-old guy who led with his heart but didn’t necessarily lead with the practicality of agency commission. I delivered it to Fred; he gave it to Mike Ovitz. About a week later I was made an agent, not because of that document only, but also because Robb Rothman left the TV/literary department for a smaller agency. It was unheard of that any agent at CAA would ever leave because it was so clearly the place to be, but Robb did, and I had my shot finally to begin my career at CAA.

LOCATION: 2418

My dad had represented both the Ice Follies and the Ice Capades, but the Ice Capades had signed Peggy Fleming, and she was about my age. So besides the music, I got to represent Peggy Fleming, which was two different hats, and that wound up playing a big role in my thinking about the future of booking bands. The old adage in the booking business was “You can never get the popcorn and the peanuts.” But the Ice Capades and Ice Follies got a piece of the concessions when they played, because they played weeks at a time. The Ice Capades and the Ice Follies and the circus were the only major accounts that came every year to every major building in the country. They made an overall deal with Peggy because she was a star for fifty weeks a year. So every time she went into a building, she got a piece of the gross above and beyond what they did the year before. And she was the hottest thing in America. I realized there was an open door into what rock bands could take out of a building based on profitability. Remember, the agent’s sole responsibility in music was to be the fiduciary of the act against the promoter and the building. My deal was to get them the best, most money out of any situation.

NOTE: Think about ways to make a bigger strategic deal

LOCATION: 2714

MICHAEL WIMER: I saw that Jack Rapke had the best literary desk, so I started reading scripts and writing coverage for him, and I figured that if I outworked his reading pace, I’d get his desk when it opened up. And when Tom Strickler was promoted in early 1987, I got it. Jack was an awesome teacher—he had good taste, faultless follow-up, and most important, he never lied. That was my single biggest concern about being an agent—I simply wouldn’t stick around in a career where I had to lie. Nicita told me that “agenting is the artful presentation of the truth,” and Jack showed me that it was possible. What I figured out was that it would be a great career track as well. That’s why I chose to represent directors. I wasn’t at all compelled by actors, since most required so much fluffing, and the glitz didn’t matter a bit to me. On the other hand, I figured that directors were like field generals who, with so much smoke being blown at them, could smell bullshit a mile away—which meant that they would attach a premium to someone who was smart, strategic, and truthful. It played to my strength. So, although it was not where the highest profile was, once again, it was an easy decision to stay away from the actor business and go with the lit side. The fit was perfect.

NOTE: Interesting to know that Strickler was on McKee’s desk. Cool to see what the lineage looks like.

LOCATION: 3444

ADAM VENIT: I was working for just a couple weeks when someone said to me, “Listen, there’s a stain on the rug in the lobby.” I said, “Yeah, well, that’s not really what I’m supposed to be doing here.” And they said, “Oh, yes, you are.” I said, “No, I’m not. I just left one of the top law schools in the country. I’m not doing that,” just as Ray Kurtzman walked in. He says, “What do you mean, you’re not doing it? Get over there and clean the stain. That’s exactly what you’re doing here, and if you don’t want to do it, then you don’t want to be here.” So I said, “Okay.” He literally handed me a spray bottle and a sponge, and I went out to the lobby and Sylvester Stallone was sitting in the lobby, wearing a big double-breasted suit with wingtip shoes, and one of his big wingtip shoes was pointing to the stain. I had to bow down to him and wipe the stain away to the point where he says, “Want to get my shoe while you’re down there?” The beauty of Hollywood is I now represent Sylvester, and we laugh about this story.

LOCATION: 3541

On a typical day, the first task was to go through all the newspapers and trade publications. Michael wanted them spread out, neatly, across a big reading space in his office, with the New York Times, the Los Angeles Times, and the Wall Street Journal in one stack, and then Variety, The Hollywood Reporter, Billboard, et cetera, in another. The rest of that task required taking a yellow highlighter to stories of note, and sometimes even adding Post-its. Of course no matter how thoroughly you tried to complete that task, you’d inevitably omit the one article that Michael would catch, and then he would criticize you for missing it. It was Murphy’s Law, I guess renamed as Ovitz’s Law! The next task was to be ready for Michael on the phone. He would call in while driving to the office, and while he was “running calls” with one of the women who worked with Michael for years at a stretch and the males in the “trainee” assistant role, he’d want to run through work in the downtime, between calls. Of course there was a whole system of how all of the folks who worked for him would juggle these tasks and this call process, and another system of how to “clear the line” after each call—as Michael lived in a constant state of paranoia, in terms of people wanting to know what he was doing and in terms of his worries about not letting someone hear something who shouldn’t be privy to it. “Is the line cleared?” was a constant refrain, and it led to a whole set of other processes to ensure “security.” Once Michael was in the office, the day took on a different vibe. Although the agency relied on an open-door policy that encouraged agents to walk freely into and out of colleagues’ offices, Michael’s door generally was kept closed. That was true back at 1888 Century Park East—in one of the trainee-made films that premiered at the annual retreat, there was a recurring shot down the long hallway to Michael’s office, where the ominous Jaws music played each time the shot was used!—and of course in the Pei building. Michael would start the day by walking back to the bay of offices where all of his assistants worked, trying to get a quick handle on what was happening and where things stood. He would start by marking up his phone sheet: he had an elaborate system for how to prioritize the day’s calls that took into account incoming and outgoing calls, and the daily flow of calls then would be managed by the woman whose job that was—with the trainee assistant stepping in to relieve her at lunch, or earlier in the morning, or late at night, after she had left. The one piece of correspondence that Michael seemed to enjoy the most was birthday cards. As birthdays approached, we’d review a list of gift suggestions, and he’d choose what the gift should be. I made the mistake one too many times of waiting until the last minute for this task, and I would get yelled at when I did. Once the list was settled, I would bring in a pile of cards, with a list of upcoming birthdays, and…

LOCATION: 3648

DAVID GREENBLATT: I thought Ovitz was brilliant. I said, “I’m never going to be as smart as that guy.” So I did an analysis. I was almost four years married at that point. I had just had a kid. Bought a small starter house. And they were just starting to “we want to pay you a lot more money, we’re going to defer a lot of the salary so it’s paid out over several years.” And I said to myself, This is what golden handcuffs are. I don’t begrudge them that, but I said if I’m ever going to be wealthy, I’ve got to take a risk because Ovitz, I’m not in his category smarts-wise, but I’m as smart as Bill and Ronnie. I’m not saying I’m as good as they are, but I’m as smart as they are. And, I said, what was the difference between who they are and who I am? They took a risk. They did the setup with the card tables and they left their job or they got fired or whatever the story is, and they started CAA. I said, “The only way I’m going to be wealthy is if I take a risk. And if I take a risk now, I’m falling five foot, eight and a half inches. If I take a risk two years from now, I’ll have a bigger mortgage, I’ll have a lot more cash that I’m leaving on the table, and I don’t know if I have the stomach to do that.” And that was it. I knew if I could model myself after their techniques, I could be just as attractive with my new partners, with my potential clients.

LOCATION: 3857

DAVID GREENBLATT: Judy walks into my office at CAA, shuts the door, and says, “They know,” and I guess I was one of those guys who was trying to avoid the inevitable. I started shuffling papers and putting stuff in files as if nothing had ever happened. And she’s looking at me and after a couple minutes she goes, “David. We have to go now.” JUDY HOFFLUND: David took like twenty minutes to put on his jacket. I said, “Come on, David, we better go! We gotta go to Mike’s office.” Mike knew nothing because he was on the phone and Ron hadn’t spoken to him. Ron, me, and David were all standing on the other side of his desk and he stood up when he got off the phone. I think David said something like, “Mike, we came in here to tell you that we’re leaving to start our own agency.” And Mike looked like the air had gotten sucked out of him and he fell back into his chair.

LOCATION: 3893

DAN ADLER: At the Wednesday staff meetings, if you mentioned you were about to sign Client X, and Ronnie knew that they were still handled by, let’s say the Gersh Agency, he would throw the brakes on it at that point. And quite often, his first call after the meeting would be to the Gersh office, and he would say, “Look, I’m just letting you know that our guys are about to sign Client X, so go save him. If you don’t, I’m telling you you’re going to lose him.” It was his way of being a gentleman, and not beating up on the smaller agencies.

NOTE: Connect to move Joel Gotler story about Conolly or Ellroy

LOCATION: 3962

DAVID GREENBLATT: When I was relatively new as an agent there, I didn’t pay much attention to the mailroom guys or anything like that. I was too worried about my own self. So Ari becomes the head of the mailroom and he’s got a real chip on his shoulder. There was one bathroom at CAA. I’m in the restroom washing up. Ari walks in and says, “You know, that package that you wanted to go out, we can’t get it done.” With a real attitude. So I look at him, and I said, “You think you’ve got it made, don’t you? Head of the mailroom. Mr. Big Shot. Let me tell you what’s going to happen with your life. You’re going to get promoted, and you’re going to be somebody’s secretary. You’re going to get their coffee, and then you’re going to say, ‘Who may I get on the phone for you now?’ You’re going to schedule their meetings. You’re going to have to pick up their laundry, and you’re going to have to stay here until ten o’clock at night, be here at six in the morning and work weekends reading their scripts. And maybe, just maybe, somebody will promote you to agent. And you know what kind of agent you’re going to be at first? You’re going to be covering TV movies for Chuck Fries Productions.” And I could just see him wither. To this day we still laugh at this because it was so dead-on. I think that’s what lit a fire under him big-time, because that was his vision of hell. One of the things that we did at InterTalent that nobody else was able to do, Morris or ICM or anybody else—we were stealing clients from CAA. Why? Because Judy and I had worked there. Tom had worked there. We knew their secrets and everybody was intrigued by Bill. It’s not like we were denting them; we weren’t getting Jane Fonda or Tom Hanks out of there. But we were getting enough clients that we were really their only threat. You can make a lot of money packaging TV movies, by the way, but it was just not anybody’s idea of chic. So Tom says, “I think Ari might be ripe for the taking.” I knew they were close, so I said, “Set up a meeting.” So I sit with Ari—and again, I had only known him peripherally except for that one incident in the restroom. ARI EMANUEL: I loved Bill Haber. Just loved him. Bruce Vinokour was Bill Haber’s guy, so I got to see Haber a lot. Then Lee Gabler kind of took over the television department—I think there were some politics going on between Haber and Ovitz. In a way, there was just so much money coming in it didn’t matter, but because I was a Haber guy, Lee just killed me when I was an agent. He was just fucking killing me.

LOCATION: 3975

Monday off, and I had told one of my good friends, Jeff Jacobs, who is an agent there, that I was going to be telling them I was leaving Tuesday morning. And on Monday night he squeals on me. It was like an episode of Entourage. He fucking squealed on me. He calls me at 5:30 Tuesday morning and says, “I had to tell them.” I said, “What do you mean, you had to tell them? Tell them what?” And he says, “I had to tell them you were leaving.” I couldn’t believe it. So when I walked into the office, everyone—Mike, Bill, and Ronnie—knew I was leaving. I wanted to tell Ovitz to his face, so I went to his office and said, “I’m trying to see Mike Ovitz.” I was told, “He’s not going to see you.” But I walked into his office anyway. Now, at the time, Mike Ovitz was God, and I was just a fucking street urchin. And he says, “I’m not seeing you.” I said, “I’ll be back in ten minutes and you’re going to deal with me then.” When I walk back in, there’s Lee Gabler and Ray Kurtzman standing there with him. Ray liked me a lot, so I was calm and said, “Listen, it’s been great, but I’ve got to leave.” And then Mike gives me, “We’re going to kill you guys and your careers are going to be over.” I turned to him, got out of my Chinese chair, Japanese chair, whatever, and said, “Are you threatening me?” And I grabbed the chair with my hands and picked it up and said, “Because if you are, I’ll fucking throw this chair right out of here right now. Don’t threaten me.” I was an idiot. I was a complete moron. You don’t do that stuff, but I’ve been a fighter all my life. MICHAEL WIMER:

LOCATION: 4013

Talent

TOM POLLOCK: Twins was a groundbreaking deal at the time. It was not Mike Ovitz who made the deal. Ivan Reitman made it with me personally because I was his lawyer before I left for Universal and there was a writers’ strike going on. We’re five months into the writers’ strike and there’s no product. Ivan had signed his company up to the interim deal with the Writers Guild that allowed him to hire Bill Goldman and various writers. I agreed to the deal knowing exactly what the numbers were. What had not been done before is that Arnold Schwarzenegger, Danny DeVito, and Ivan Reitman took no money, so the movie was made for $15 million up front. But they got 35 percent of the gross for a certain period of time and then they took less while we recouped advertising. After that happened, they got more and they eventually went up even higher. They made a shitload of money. It was incredibly lucrative. Ivan, Danny, and Arnold told me that they never made as much money on any other movie as they did on this one. MICHAEL OVITZ: Sandy would do all of the modeling to compare to the studio. We had the capability to model as good as the studios, so we knew when they’d say, “Oh, well, we’re over budget,” and Sandy would say, “No, you’re not. Here’s our number.” We’d fight over his numbers versus theirs. SANDY CLIMAN: I brought modeling into CAA for the first time; before that, no one at the agency was thinking about projections, or in other words, a movie’s box office potential and all the revenue that followed from the home. So when we packaged Twins, for instance, which was sheer genius and nothing I can take credit for, we were able to have a sense of what it was going to do, and when the studio wanted two of our important clients to give up their fees in exchange for a bigger back end, we could tell them it not only made sense, but it would be terrific for them. Which it was; the back end worked like a charm.

LOCATION: 4060

support me.” I truly didn’t know how to navigate my way out of this, and then my phone rang. The voice on the other end says, “Hi, this is Mike Ovitz.” And I said, “Hi.” And he said, “I hear you have a problem.” I said, “Yes, I do.” He said, “Would you like me to solve it?” I said “Yes, please.” He said, “Stay by your phone.” Two hours later he called me and said, “Okay, I’ve solved your problem.” I said, “What did you do?” He said, “I traded some things. There are some things Universal wanted that Warners had, some things Warner wanted that Universal had. It’s all taken care of. Is there anything else you need?” And I said, “God, I’d love two more weeks of editing time on Clean and Sober.” And Michael says, “Stay by your phone.” And less than two hours later he calls back and says, “You have two more weeks of editing on Clean and Sober.” And he says, “Listen, I’d really love to sit with you and take you out for a meal and talk about representing you.” I said, “Oh, I could never do that.” And he said, “You could never do what?” I said, “I could never sit with you and have a meal because it would be very unfair to Elliot Webb. I’ve been with him for ten years and he would just be destroyed if he ever heard.” He laughed and he said, “Well, I hope you’ll change your mind because I’d love to talk to you.” A week later a messenger comes over with a book of coupons from McDonald’s. He says, “If you ever change your mind and want to have a meal, Mike.”

LOCATION: 4107

MICHAEL OVITZ: Jerry Weintraub once said to me, “You’re going to get to be so powerful that at some point, people will start saying you did things you didn’t do and that you were in places you weren’t.” I laughed at him at the time, but that’s exactly what happened.

LOCATION: 4276

MICHAEL OVITZ: I had been getting closer to Arne Glimcher and his wife and was blown away by their broad knowledge of aesthetics. I asked Arne to call I. M. and said, “Please tell him I only want fifteen minutes.” That was always my approach with someone I hadn’t met. I’d walk in, take my watch off as I sat down, and say, “Okay, I have fourteen minutes left.” With I. M. Pei, I told him I had looked at every building he had ever designed, and that I had this property that I wanted to be a cultural destination. I told him I wanted to put a major piece of art in an atrium, I wanted it to be an icon for the city, and most important, I wanted it to scream I. M. Pei.

LOCATION: 4422

JACK RAPKE: The studio decided they wanted to do two sequels. Bob Zemeckis had a directing deal on the original Back to the Future, which was a traditional director deal in the sense that if there was to be a sequel, he would receive no less than the floor of his deal, so they couldn’t do a sequel, hire him, and pay him less than what he got for the original. So I said, “There’s no way that Bob Zemeckis is going to direct the sequel or sequels for the floor of the deal. It’s not happening.” Tom Pollock was the president of Universal at the time and there was a long period of silence. We’re sort of marching toward the start date of Back to the Future II, and there is still no deal on the back end and no deal on the director fee. I keep on telling Tom and business affairs, “Guys, the clock is ticking and we still don’t have a deal.” Then it floats back, “Well, we believe we do have a deal.” I said, “What do you mean, we have a deal? We’ve been negotiating. We haven’t agreed to a deal.” “Well, we believe that when push comes to shove, we have a deal.” I said, “Well, that’s not the way I look at it.” In the meantime, the clock keeps ticking, the fuse is burning down. Now Bob’s getting a little frustrated, “Why won’t they make my deal? I made a giant hit for them, they want me to do the sequel pictures, why are they doing this to me?” I said, “I don’t know. I can assure you that it’s not personal, but I can’t get a handle on why they’re not negotiating this deal in a timely fashion.” So we hire Frank Rothman, a litigator who used to be the head of MGM, and he looks through the original Back to the Future contracts and he tells me that they could enforce a deal on Two, but they have no deal on Three. But if push comes to shove and they want to litigate you, they can force you to do Two under the original deal. It’s about seven business days from photography. We still don’t have a deal and the studio’s not talking. So I have a conversation with Bob where I said, “Bob, if we don’t have a deal, I don’t want you to report to the set the first day of photography.” And this is after millions have been spent on preproduction, okay? He said, “What? I’m not going to report?” And I said, “Yeah, because that’s the only leverage we have, because they’re still not negotiating this, and we’re seven days from photography without a deal! I will not let you go to the set.” He understood the play and he backed the play—which was not easy. So the following week, we’re about three days from photography, and I say, “Tom, I am going to recommend to Bob that if we don’t have a deal, that he’s not reporting to the set.” This is giant, okay. Next thing I know, Michael Ovitz calls me and says, “What the fuck? Come into my office.” He says, “What the fuck is going on? You told the studio that Zemeckis is not going to report to the set?” Now I don’t know if he spoke to Lew or he spoke to Sid or Tom, but I said, “Yeah,” and I run him through the whole history. Two days later,…

LOCATION: 4622

Rob Reiner had been a client of CAA’s for over a decade, and when he and his partners at Castle Rock went into television production, CAA wanted to make sure they got off to the strongest start possible. As a result, it was one of the accounts that Tony Krantz made a priority, and the first year out, the company and Krantz sold nine pilots to the networks, a truly impressive debut for any company, much less a brand-new one. One of the shows was based on what one executive called a “weird” little presentation out of the late-night division at NBC, featuring a comedian few had heard of. Howard West (who had been so influential during the formation of CAA) and George Shapiro called Krantz and asked if CAA would waive its commission on the show because the budget didn’t have enough money to pay the CAA package fee and pay the comedian’s managers (West and Shapiro were to be executive producers on the show). Krantz was obligated to take the request to Ron Meyer, who represented Reiner personally, for Meyer’s advice and approval. Meyer wanted to be loyal to his former William Morris colleagues, and besides, it was only one of nine pilots and no one thought it had a chance. So Meyer told Krantz that CAA would give up its commissions in the show. The “weird presentation” was for a show the managers were calling The Seinfeld Chronicles, and it would become perhaps the greatest television comedy of all time, and an asset worth as much as a staggering $4 billion. The loss in commissions to CAA was perhaps as much as $400 million, but Meyer would never regret it. As far as he was concerned, he made it possible for West and Shapiro to be a part of television history—and really, really wealthy.

LOCATION: 4940

Sony / Columbia / Matsushita

Walter Yetnikoff was the senior attorney at CBS Records who guided the Sony acquisition of CBS Records, which was a huge success for Sony, both economically and strategically. Yetnikoff developed a close personal relationship with Sony president Norio Ohga, who installed him as CEO of CBS Records and became his key man in the entertainment industry. In 1988, as Sony contemplated buying a movie studio, Yetnikoff, an Ovitz friend, suggested it engage Ovitz as a consultant on this exploration. Sony’s other advisers included Blackstone founders Pete Peterson and Steve Schwarzman. Ovitz first tried to steer Sony toward MCA and then MGM/UA, but terms did not work out. Sony finally decided to buy Columbia Pictures Entertainment for $3.4 billion in October 1989; at the time it was the largest takeover of an American firm by a Japanese company. It was a double victory for Ovitz: He proved that he played a key role in multibillion-dollar deals on an international scale, and it placed CAA in a unique position to do better business with the studio. Ovitz would earn $12 million for helping broker Sony’s purchase of Columbia Pictures—the check was sent via U.S. mail by Yetnikoff. In separate negotiations, Sony considered having Ovitz sell his majority stake in CAA and then take over Sony’s two studios, Columbia/TriStar. Morgan Stanley represented Ovitz and the deal fell through. Sony then hired Peter Guber and Jon Peters to run Columbia/TriStar. Ovitz was peeved, both because his counteroffer had been rejected and because he believed they were prodigal spendthrifts. Guber kept it simple. He invited the Young Turks—but not CAA’s senior partners—to his Aspen retreat.

LOCATION: 4978

MICHAEL WIMER: Around 1991, a private equity buddy of mine from Stanford bought Premiere magazine, which was edited by Susan Lyne. In one of her early “Power” lists, the magazine first used the term “Young Turks,” mentioning Jay, Richard, Doc, Bryan and Kevin, and myself as the group. Ovitz was on fire when he saw it—he went nuts. He called me on the carpet, as he wrongly assumed that I had made the connection. I’m sure that Susan, who knew the business well, was aware that Jay and Doc and Richard and I were great friends with Peter Guber since he and Jon Peters took over Sony in 1989. It was pretty high-profile stuff, with legendary times at his Aspen home or trips to sets on the Sony plane. Peter was an awesome mentor and buddy, and he couldn’t have been a more generous friend. At the same time, Bryan and Kevin were wired into Carrie Fisher’s world, and the group of us were the only agents—of any generation—at her high-wattage, intimate parties. What the hell? I remember laughing with Glenn Frey when we were jockeying to use the bathroom after Meryl Streep came out—laughing because Carrie had shouted at her about her “horse stream.” Nobody could make her laugh like Carrie. Hell, nobody could make any of us laugh like Carrie did. It was all such a hoot. All six of us were having a blast. But it wasn’t true that I had planted us on the Power list. What was true, however, was that the six of us had started to meet in 1989, on the qt, to discuss how we could be more effective at signing new talent, both in and out of the company, as well as having more of a role in affecting the direction of the company. The problem with CAA was that, in the motion picture department, there was a significant energy gap between the delineated leaders (Swedlin and Rapke in literary, Nicita in talent) and the defacto leaders, which were the group of us. Kevin and Bryan were signing machines. Jay Moloney used his position as Michael’s right-hand man to work into the worlds of Bill Murray, Tim Burton, and Martin Scorsese. Richard was outworking everyone and was about to sign Tom Hanks. Doc was running the literary department and had every big writer. I had a huge directors list. We were killing.

LOCATION: 4997

MICHAEL OVITZ: I got paid $12 million for the Sony deal and I turned down running the studio. I gave the Sony executives a list of people, which Peter and Jon were not on, and then when they picked them, I withdrew as a consultant because I could see the writing on the wall. Peter was brilliant, but Jon wasn’t an executive, and together it was just going to be a problem. I also didn’t think they could handle the whole Japanese side of things. PETER GUBER, Executive: A month after the title passed at Sony, Mike Ovitz came to the office and said, “I’d like my fee.” I said, “A fee for what?” He said, “For making the deal.” I said, “It’s the first I’ve heard of you being involved in the transaction. It’s the first I’ve known of you. So you’re peeing on the wrong tree. Go speak to Morita, and if he wants to give you a fee, it’s fine with me.” He said, “Well, you know how important I am to the business, and if I feel that I’m not being properly handled, I’ll be very upset.” I said, “Look. I’m not really good at managing anybody’s emotions, including my dog’s.” And that was the last I heard of him.

LOCATION: 5051

MICHAEL OVITZ: Sandy ran the whole business group, a department with something like eight MBAs in it. I asked Sandy to tell me what other Japanese companies might be interested in the film or media business. What came back to me was, no surprise, companies you’d see if you went to an electronics store: Samsung, JVC, Toshiba, Sony, and Panasonic. That was the list. Then if you went to Europe, it was Philips. Then I asked Sandy to find out which of them had cash on their balance sheet. Sandy went to a stockbroker, pulled the annual reports, then eliminated companies that made no sense. He came back to me and said, “I found one company that makes more sense than anybody else.” I asked him, “What is it?” And he said, “Matsushita Electric. They own Panasonic.” One number stood out at me when I read the annual report: they had $12 billion in cash. And I said, “Great, give me everything there is to read.” We bought every book on Matsushita Electric, including the seven books of the writings of the chairman, Mr. Matsushita. I read them all. And when they had appendixes and other references, we got them as well. Then I sent a mailroom guy to go to the UCLA archives and look at the English-language Japanese newspaper, which I had seen from being over there. We discovered that Matsushita was called by Japanese businessmen a Japanese word that meant “copycat” because everything that Sony did, they copied. And Sony had already bought Columbia. A lightbulb went off in my head and I said to myself, My God. They’re going to want to buy a studio. I started looking for ways to get in the door. I discovered that JVC had a young Japanese guy who was educated in America—which was the Japanese way at the time—living in Los Angeles, and his job was to watch Larry Gordon and report back to the people at JVC, who had made an investment there. And lo and behold, JVC was 50 percent owned and controlled by Matsushita, so being a good agent, I started to figure out a way to get on that guy’s radar screen. I got Sandy into a relationship with the guy to manipulate him to ask for a meeting with me. Which he did. And I said no. Which is the game: yes is no, no is yes. So for four weeks this guy asked Sandy, once a week, for a meeting with me. And true to his direction, he was told to tell the guy no. The fifth week, worried I was going to overplay my hand, I agreed to a meeting for fifteen minutes.

LOCATION: 5070

SANDY CLIMAN: The first contact from Japan on the Matsushita Electric deal did not come from Matsushita directly, but rather from Matsushita affiliate JVC. JVC legal adviser Peter Dekom helped bring together CAA with the JVC head of audiovisual, Isamu Tomitsuka. For the first meeting, we needed a private and secure place. We couldn’t meet at CAA, and we were too well known around town for even private rooms at restaurants or major hotels. So I picked the “Bruin” private dining room at the Holiday Inn in Westwood, a hotel so low-end no one from the industry would ever be seen there. That was the first meeting with JVC. It was Mike, Bob, Ray, and me from CAA, and Mr. Tomitsuka and his Hollywood lieutenant, Henry Ishii, from JVC. MICHAEL OVITZ: We exchanged business cards—I had great business cards, one side’s Japanese, one side’s English; that’s how it’s done all over the world—and to make a long story short, I charmed the shit out of this guy because I knew everything that was important to them and how to talk with them. In Japan, they don’t ask you how you feel. If you have a cold, they don’t ask you if you have a cold. If you have cancer, you’re not allowed to discuss it. You’re not allowed to sit with the soles of your feet toward your guest. You’re not allowed to cross your legs. You’re not allowed to take your jacket off unless you ask, “Can we all have our jackets off?” I can go through a hundred things like this. I knew how to use chopsticks better than many Japanese. I knew the history of sake. SANDY CLIMAN: After several strategy discussions, the JVC team reported back to Matsushita management. Like scouts who are replaced by soldiers, Matsushita took over discussions with us, and JVC was out of the picture, never to be seen again. Matsushita contacted Ovitz in the fall of 1989 and hired him as a consultant. Ovitz then assembled a team that included New York law firm Simpson Thacher & Bartlett to represent Matsushita in the United States, as well as Herbert Allen of the Allen & Company investment firm and public relations firm Adams and Rinehart. For its initial meeting with Ovitz, Matsushita sent executive vice president Masahiko Hirata; the firm’s decision to send a senior executive showed Ovitz that it was serious about acquiring a Hollywood studio. Ovitz persuaded Matsushita to consider MCA in the spring of 1990.

NOTE: How well you have to know your pplHow to expand into other arenas

LOCATION: 5087

MICHAEL OVITZ: At the end, one hour before we’re set to take off, they said, “So if we were interested in looking to buy a motion picture studio, how would we pay you?” That’s what the question was. I looked at Hirata, straight in the eye and I said, “Hirata-san, if I provide a service that you find worthy and productive but does not result in anything, I expect nothing but my expenses.” And then I said, “But if, Hirata-san, I provide a service that you find worthy and productive, and if the price is to your satisfaction and you buy a company, I will then expect you to take a Brinks armored truck, load it with money, and send it to my house.” There was a beat because the translator has to translate. Then he bowed so deep, his head almost hit the table. We shook hands and we left. BOB GOLDMAN: We didn’t charge them anything up front. We went to them as advisers, much like bankers, and we never talked about fees. SANDY CLIMAN: Our trips to Japan were highly orchestrated—even scripted. Mike, Bob, and I would board the ANA flight to Osaka. Mike and Bob would take an Ambien and sleep for eleven hours. During those eleven hours, I would write and rewrite the speeches Mike would give during the next several days of meetings with Matsushita. I would handwrite everything on a legal pad and hand it to Mike as he got off the plane in Osaka. MICHAEL OVITZ: On my first trip to Osaka, Hirata walked me into a room ten feet square. On the floor were twenty-five or thirty neat stacks, a couple inches apart, with cover letters on them from every investment bank in the world, thanking them for meeting, talking about their fee schedule, attaching a contract and information about their company, along with research on all the movie studios. Hirata had me look at it; then he looked at me, smiled, and then we walk out the door. He turned every one of them down and took me because I was the only one who asked for nothing, which is how they wanted to do business. They wanted a handshake. I never signed anything with them. ATSURO UEDE, Executive: CAA evaluated MCA and other companies for the purpose of Matsushita and advised us on the expected feeling of Mr. Wasserman, how MCA should be operated after merger, who were key persons in MCA, and played an important role to arrange first meeting between tops of MCA and Matsushita. He [Ovitz] never said he wanted the job. He mentioned that he was taking care of CAA. He didn’t want to run the company. SANDY CLIMAN:

LOCATION: 5122

More Talent

KEVIN COSTNER: I didn’t want to have standard deals, and I felt like CAA and Mike would be able to get me away from them. I wanted ownership; and I was willing to be entrepreneurial. ARMY BERNSTEIN: One day Kevin Costner came to my house, and was just really down. I said, “What’s going on?” and he said, “I have this screenplay, I can’t get it made. No one will do it with me.” I said, “What is it?” and he says, “It’s a Western called Dances with Wolves, and it’s from a novel. I just love it. I can get some money internationally, but I just can’t raise it domestically.” I said, “Why doesn’t anybody want to do it?” and he said, “Well, it’s three hours long, the Indians are going to speak original Lakota Sioux, I’m going to star in it, and I’m also going to direct it. I don’t have the money and the winter is coming and if I don’t do it now I’m never going to do it. And it’s the thing I want to do most in all the world.” I read it, one of the best screenplays I’ve ever read. I said, “Kevin, if you can’t get this movie made, then I don’t even want to be in the film business. Let me see if I can help you raise the money,” and I literally started to create Beacon Productions that day. I called a friend who I went to college with at the University of Wisconsin, Tom Rosenberg—he had become super successful in the real estate business—and he became my first partner in Beacon. I wanted to go go go, do whatever it took to finance Dances with Wolves, but I realized we probably wouldn’t be able to get there on time. So I went to Mike Ovitz, who was my agent, and sat down and asked, “What should we do?” He said, “I can get this made,” and he set it up at Orion. You see, Michael back then, he could get your movie made. He made things happen. And Kevin became his client.

LOCATION: 5277

MAGIC JOHNSON, Athlete: I was trying to get somebody to take my career off the court and take it to another level. I asked everybody who was the best in the city to do that, and help me go from being a basketball player to a businessman, and who could also redo my basketball contract. Everybody pointed me in the direction of Michael Ovitz. So I called him and asked if he would take a meeting with me, and he said yes. We had our meeting, and it was really interesting, because it wasn’t a long meeting at all. He said, “I have all the biggest actors, producers, directors, and writers in the world. Why should I represent you? Most athletes blow all the money they make and go broke. I don’t have the patience or the time to represent somebody who won’t listen.” I said, “I’m different, I’ve always wanted to be a businessman.” He talked for two or three or five minutes, and then he threw me out. So I went into his office six foot nine and walked out about five foot nine. He really bruised my ego. He called me back a couple of weeks later and said, “I did my homework on you, and I talked to a lot of people; they said you are serious about becoming a businessman.” Then he asked me, “Do you read the newspaper every day?” I said, “Yes.” He said, “What section do you read first?” I told him the sports section, and he said, “Wrong answer. It’s gotta be the business section.” He said, “This is what I’m going to do. I’m going to test you to see if you really want to be a businessman, I’m going to give you all of these business journals to read, and after you do, we’ll discuss them. Then I’ll know whether I want to represent you or not.” So he gave me a hard homework assignment, I came back and he asked me questions, and I answered them. After that, he decided to represent me. We used to meet at Morton’s, and before we went there for the first time, he said, “We’re not just going to lunch; I want you to watch and see what happens.” So they sat us right in the middle of the whole restaurant, and within the first ten or fifteen minutes, everyone there had made their way over to say hello, and everybody wanted to talk about a deal with him. I said, “Man, it’s like everybody wanted to come over and kiss the ring.” He said, “I always get the middle table so I can see everybody, and everybody can see me.” I took that note. When Michael Ovitz introduced basketball superstar Earvin “Magic” Johnson to top executives at Coca-Cola, it was clear they were eager to sign the star athlete to a lucrative spokesperson deal. But, typically, the ever-demanding Ovitz wasn’t satisfied with what was put forward on the bargaining table, and so his next stop was Pepsi, and by the time negotiations there were complete, Ovitz had secured for Johnson a huge deal to become partners with Earl Graves Sr., the founder of Black Enterprise magazine, in the Washington, D.C., area Pepsi bottling plant. The transaction would prove to be the foundation of Magic Johnson’s wealth for years—indeed,…

LOCATION: 5385

DAVID LETTERMAN: I was as low in my life as a person can get without the loss of a loved one. Michael came in with his cuff links and his two-million-dollar suits, and he gave me a career. I will never be able to thank him enough for that. It was phenomenal. It was just phenomenal. There will never be another deal like this in television. After the deal was done, he became like our uncle. He would show up and he would take everybody to dinner. One time he was friends with the Nobu people and we had a big catered sushi dinner. There was no reason to question this man’s friendship. None. I’ve never known anybody like him. I guess you don’t know anybody like him for the most obvious reason—there is nobody like him. Overlooked at the time was a clause in Letterman’s contract that not only gave Letterman equity in the 12:30 A.M. hour, but also a rich development deal for a half-hour sitcom. Letterman quickly had an idea for a show, one starring a little known stand-up comic known as Ray Romano. LES MOONVES, Executive: Everybody Loves Raymond was great for David Letterman and great for us. God bless him, because you want to know the truth? We would not have produced the pilot if it wasn’t for David Letterman. Ray Romano was a stand-up comedian in his midthirties. Phil Rosenthal had never really created anything that worked, but we paid a lot of attention to it because it was Dave’s project. Thank God we did. JEFF JACOBS, Agent:

LOCATION: 5537

Not since Jaws or The Godfather had there been a movie that screamed sequel so fast as Ghostbusters, but for several years after its release, despite it being high on the CAA to-do list, it seemed like an impossibility, which made it even more frustrating for Ovitz, particularly since it involved Ivan Reitman and Bill Murray, two clients he was particularly close to. The first big obstacle actually involved Murray and Ovitz himself. Columbia chief David Puttnam had gone so far as to publicly take on Murray and what he saw as a corrupt star system. Ovitz took great umbrage, and the chances for a Ghostbusters sequel were a casualty. But the other speed bump was the original group had splintered. There were some hard feelings left in the wake of the original’s success. The goddess of triumph had been kinder to some (Bill Murray) than to others (even Aykroyd and Harold Ramis weren’t at Murray’s level). Ghostbusters had obviously looked like a huge fat hit going in. For once, the dish proved as delicious as it had looked on paper. But in the afterglow, once the last celebration was over, the division of profits among the stars, director, and producers turned out to be extremely unequal, as were the shrieks of pain from Harold Ramis, who as cowriter contributed largely to the film’s success (he was also in the cast) but who likely got the lowest payout afterwards. Ramis, who once said that the seven months he spent working in an insane asylum helped prepare him for dealing with the movers and shakers of Hollywood, had felt his share of the spoils on the original qualified as lunatic, and was not shy about letting his opinion be known. Finally, Ovitz was able to orchestrate a sitdown at Jimmy’s in Century City with the film’s stars, joined by Kurtzman and Climan. At the lunch, Ghostbusters 2 was referred to affectionately as “economic entropy—money in the atmosphere just waiting to be harvested.” The group worked out a new split and was promised an unprecedented economic deal with Columbia. Ovitz asked Climan to “model” the movie as the studios had long done, though it was something then rare at the agency level. Financial performance was predicted based upon historic data that linked box office to earnings in home video, pay television, and dear old you-remember-that television. Climan had studied the studio formulas and developed CAA’s own set of equations, giving the agency another edge over its rivals that had not yet developed quantitative financial tools. As it turned out, Climan’s model did not differ all that much from Columbia’s, and the agency and the studio basically combined their models to come up with the gross percentage. That backstage story would prove to be one of Ray Kurtzman’s finest hours in terms of actual deal making, handing over to those jolly CAA clients a luscious 35 percent of the gross. Plenty of Kissingeresque shuttle diplomacy went into keeping everybody happy; even Bernie Brillstein, manager of the principals, ended up…

LOCATION: 5722

RON MEYER: Although it made a big difference financially, I was probably more against outside corporate deals than in favor of them. I felt our obligation was to focus on our clients, and not on outside businesses. I was also against getting into the sports business back then because I thought that would take us too far away from our core businesses. In retrospect, I was shortsighted. Agencies today have proven they can take care of their basic businesses and expand without damaging their clients.

LOCATION: 5807

PETER SEALEY: In the beginning, Michael said, “Peter, I’m going to do all of this at my cost. We’ll decide my profit later.” I should have peeked at that. I should have gone, “No, wait a minute,” but I said okay. So the campaign goes up and I can’t tell you how successful it was. So now I’ve got to decide how much to pay Michael. I went through a lot of machinations and I decided to pay him $10 million. I went to my financial guy and said, “Don, I want to pay Michael $10 million. It’s a lot of money, but he’s worth it. It’s a spectacular effort.” So I had my accounting people issue a check for $10 million, payable to Michael Ovitz, and I had them put it in the hands of a little toy polar bear and walked it over to CAA. Three days later, I get an envelope from Michael with the same check and a little Post-it note on it. The check is voided and the Post-it says, “Pete. Let’s discuss this.” He returned the check! And I said to myself, Oh, Christ. Here we go. When I brought my accounting guy the check back, he almost fainted. So Michael says, “Peter, I want to talk to Don about this. It doesn’t feel right to me.” So Michael went up one step to Don Keough, chief operating officer, and a final step to Roberto [Goizueta], the chief executive officer. MICHAEL OVITZ: I don’t remember the number for Coke. Honest to God I don’t. SHELLY HOCHRON: Michael never asked me what CAA deserved for the Coke campaign. I heard he turned away ten. Twelve? That would be high. PETER SEALEY: Thirty-one. Thirty-one million. In retrospect, it was worth it. But it was classic Michael Ovitz. You’ve got to admire the guy. PAULA WAGNER: I left CAA in August ’92. As an agent you aren’t a principal. You’re the representative of the principal, and I had decided I wanted to be a principal. I wanted to make movies and start a company. I had been an agent since May 1, 1978, and I loved being an agent, and I was one of a team of people that basically helped create the identity for Creative Artists Agency and made it the premier entertainment company. But on a deeper level, I needed to have something that was mine. I wanted to make my own mark.

LOCATION: 5887

JOEL SILVER: We were making Demolition Man in ’93, and Warner Bros. made a promotional partnership deal with General Motors. There was a guy named Phil Guarascio who was head of GM’s brand recognition, I think they called his division Consumer Awareness, and he had a budget of around $100 million a year. He used to give a big check to Ken Burns every few years to fund those great documentaries. One day he said to me, “You know what? We need help with our Oldsmobile brand.” In the movie, Sly’s character was supposed to drive a cherried-out 1970s Pontiac GTO. He said to me, “We want you to use an Oldsmobile in that scene.” So they actually made us, at the GM factory in fucking Michigan, a brand-new 1970 Oldsmobile 442 for the movie. They said, “We need Oldsmobile to be the signature vehicle for that film.” One day this guy named John Rock called me up, he was the actual brand manager for Oldsmobile, and said, “I’m reading about this place CAA. I haven’t told anybody yet, but I feel like I can discuss this with you. After like seventy years with Leo Burnett, we’re thinking about making a change, and I’ve heard a lot about what CAA has done with Coca-Cola and maybe they would be a good place for us. Can you see if they would be interested in talking to us?” So I called Ronnie and he says, “I would tell the guy no.” And I couldn’t believe it. I said, “But it’s Oldsmobile! He wants CAA! How can that not be great?” Ronnie said, “I promise you, you’ll never get what you want out of this.” So I called Ovitz and told him about it anyway, and he says to me, “I will only do it if I get all the GM brands.” I said, “Mike. Think about this. This is Oldsmobile. Do well for them, then maybe you’ll get Chevrolet or Cadillac,” but he told me, “I’m not going to do it for one car. I want all the cars.” So I called Ronnie and I said, “How did you know?” And he says, “Because I know him. I live here.” Come on, think of it: He wouldn’t have the fucking meeting with Oldsmobile unless he got all the GM brands. If they had announced that CAA was going to be the new advertising agency for Oldsmobile, it would have changed the fucking world at that time. He didn’t even want to take the meeting. In the course of redefining the job of agent, Michael Ovitz became a living directory of the most knowledgeable, celebrated professionals available—physicians of all kinds chief among them. Ovitz knew the best doctors to consult and the best hospitals to be treated at, all part of his service to his clients. If a client’s son or daughter had an automobile accident, Ovitz could refer the client to the right doctor, the right hospital, and if need be, the right lawyer. He could also recommend the “right” educational institution, be it college or private school. If a studio was hiring an executive and needed to get the executive’s kid into a private school, Ovitz knew the heads of each and what buttons to push for admission. All these talents made Ovitz indispensable as an agent, and…

LOCATION: 5918

AMY HECKERLING, Director: I was at another agency for a very long time, because the person had seen my student film and wanted to handle me. So we were together for a very long time, but at a certain point I kept feeling like I was banging my head against the wall. I would write something and it would be in development and even though I’d had a film, Fast Times at Ridgemont High, that cost nothing and made tons of money, it seemed like it didn’t get me anything like all the guys were getting, you know? I was afraid of CAA because of Mike Ovitz. He scared me. He seemed scary. Showbiz scares me anyway. I’m easily intimidated. My ex-husband had been with them and I always felt like he followed whatever was the cool thing to do. I always felt more of an outsider in everything and so I felt like “I don’t belong with the cool people.” I mean, that’s not where I sit in the lunchroom. But at a certain point I felt like, gee, maybe I should explore other possibilities. Michael Wimer, Ken Stovitz, and Richard Lovett came to my house, and I told them, “You’re the in crowd, that’s not where I live.” And they’re like, “No, no, we’re the nerds. We’re the nerds.” I just didn’t believe it because they were just too cool and cute and well dressed. And you know there were articles in the press about CAA and the Young Turks running around Wilshire Boulevard, but they sent me a gift basket, and it was to prove that they were nerds. It had pajamas with feet on them and a Brady Bunch quiz book and crazy stuff to say, “We’re not cool. We’re not the cool kids.” And part of me just went, Please. But the other part was like, Wow. They’re trying. That’s so sweet. You know? So I was like, Okay. Why do you always have to run away from what everybody else is having? Why not try it? So I said okay. At a certain point I went in to pitch a TV idea at Fox and they said, “No, we want to do something about cool kids. When other people come in to pitch stuff, it’s always about the outsiders. How come everybody always pitches the outsiders? We want to do something about the in crowd.” So I wrote a pilot based on a character I had always had floating around in my head which was the opposite of me. Somebody that was positive and wasn’t afraid the world was always going to take them down and assumed things would always be great. I found that type hilarious. When I joined CAA, Ken Stovitz asked to see everything I had been writing, and I showed it to him, and then he called me up and he said, “This is too good to be a pilot. This is a movie.” So he got to the TV people, had everybody talk, then he made that happen, ultimately in the form of Clueless. He got to Scott Rudin, and when Scott Rudin read it, he liked it. And then we went from everyone in town passing on it to a bidding

Note: See Clueless Notes

LOCATION: 6307

war. The fact is that Ken Stovitz refused to give up in the face of everybody telling him we’re not doing movies with stupid teenagers anymore because Airheads did badly, and the genre has passed because nobody wants to do female characters and all these things that people would say were the rules of the day. Ken just…

LOCATION: 6326

Ron Meyer was in his office with one of his many protégés—CAA agent Kevin Huvane. On the phone was actress Demi Moore. The news was good, and Demi told Meyer how grateful she was for the help. “Kevin did all the heavy lifting on this,” Meyer told her. “He’s the one that deserves the bulk of the thanks.” Elsewhere, CAA agent Jay Moloney had just gotten off the phone with one of the agency’s superstar clients, director Martin Scorsese. Moloney was bouncing off the walls, telling Michael Ovitz and several other agents gathered Scorsese had told Moloney how much he loved him and how much he loved working with him. It was, Moloney said, “The greatest phone call of my life.” Ovitz took all Moloney’s unbridled enthusiasm in, and then said to him, “Yeah, and I can take him back with just one phone call.” Moloney’s face went flat.

LOCATION: 6628

EDGAR BRONFMAN JR., Executive: The first time I ever heard from Mike Ovitz was around 1985. He called and told me his father worked for one of Seagram’s distributors in Southern California, and according to Mike, management there was forcing him to retire. He said they’d even taken his office away. So I said, “That doesn’t sound like the way our distributors normally behave, but let me find out what’s going on.” So I actually called the guy who ran my U.S. sales operation at the time and I said, “Look, this guy Dave Ovitz, he’s on the Thrifty Drug account and evidently they’re trying to get him to retire. Make sure he stays there as long as he likes and that he has an office. When that’s done, call me back.” He called me back an hour later and said, “Dave Ovitz is in his office for as long as you want.” And I said, “Thank you.” I called Mike and said, “Call your dad. He’s in his office.” He said, “I don’t know how to thank you,” and I said, “You don’t have to thank me, I’m happy to do it.” And he said, “Well, no, no. I want to thank you. Would you like to meet Martin Scorsese?” And I said, “I’m always happy to meet somebody, but you called me for a favor, I know who you are, I admire what you’ve done, I’m happy to do you a favor.” The next time he came to New York, he called to see me, and from then on, he made it his business to be my friend. There was no salesman like Mike.

LOCATION: 6876

DAVID GEFFEN: What happened was, Edgar called me up and told me that he was having problems closing the deal with Mike and he wanted to talk to me about it, so he came to my apartment in New York. He explained the deal and how Mike kept on asking for more and renegotiating to try and make it better. He told me his father had finally lost patience with it. He felt he had gone too far and wanted to go in the other direction and make it less than what was on the table at that moment. And I said to Edgar, “You know, you’re going to have nothing but trouble with Mike. This is the way he is.” And because I knew Ronnie wanted out, that Ronnie hated being an agent and was fearful he’d never get out, I said to Edgar, “I’ve got the perfect guy for you.” He said, “Who’s that?” I said, “Ron Meyer. Ron Meyer is the guy you should get. Ron Meyer is a guy who you can work with; who you can trust; who isn’t greedy and everybody loves him. And he knows everybody.” So he said, “What would he cost me?” I said, “Send me a contract and Ron will sign it. He won’t negotiate it at all.” He said, “Are you serious?” I said, “Absolutely. Whatever you send me he will sign.” I called up Ronnie and I said, “Ronnie, it’s here. I can make a deal for you to become president of Universal.” And Ron said, “You’re kidding.” I said, “No, I’m not kidding, and I think we can close the deal.” I said, “I told him that whatever he offered you, whatever that was, there’d be no negotiation. You’d sign the contract as it was.” He said, “Count on it.” And that’s how it happened.

LOCATION: 7100

The Split

IVAN REITMAN: I don’t know what Ronnie’s deal was, but it was way less than Michael had negotiated. Ron was the real workhorse; it was clear Mike relied a great deal on Ron. But Ron saw the writing on the wall, so he made the next smartest deal, and he actually said yes to it. So Ovitz was miserable. And by then all these so-called Young Turks, this next generation, no longer trusted their boss and wanted their piece of that agency, and they represented all the up-and-coming clients. I think he saw that writing on the wall, he was always really smart about that.

LOCATION: 7159

MICHAEL OVITZ: Without Ron, I had no buffer with that whole next level at the agency, and frankly, I knew—I’m not an idiot—where that would go. They’d want to be my partner. They’d want to divide up what stock Ron had. They’d want to throw out Bill and then they’d turn on me. I knew that. I had Jay Moloney starting to show signs of flipping out; I had Ray Kurtzman getting older; I was giving Jack Rapke bonus checks for millions of dollars when he wasn’t signing that kind of business, just handling my clients, and a bunch of other people who wanted more and more and more. It was a fucking mess. Then one day, Jay came into my office, slammed his fist on my desk, and said, “We want to see the books.” I was totally startled and had no idea at that time he had a drug problem. I tried to be calm and said that at the right moment, depending on a series of events that might or might not occur, I’d let him know. That evidently wasn’t good enough for him and he started to come toward me. I went into his face and told him, “Get the fuck out of my office,” and at that point, he knew better than to continue. Of course he didn’t know what it meant to see the books. He had no idea. None. Zero. He bought me a gift afterwards, a beautiful watch. It was his way of apologizing. LEE GABLER: It was pretty gutsy to walk into Ovitz’s office and say, “We want a piece of the company.” Forget Jay being on whatever he was on at the time. Those guys handled it great. It was a great poker play. MICHAEL OVITZ: They did put him up to it, without a doubt. They didn’t have the balls to do it themselves. He came in all worked up to do it because they couldn’t look me square in the eye. It was an awful moment. That’s the difference between me and them: Everything I did was calculated and strategic, and all of their decisions were done strictly out of emotion. DAVID O’CONNOR: We felt that we were representing the vast majority of the important clients and we felt like we were the engine room. We were also the people signing a lot of new business. People on the outside were saying, “Ovitz is going to leave, and then what are you going to do? You’d better figure out your response.” And people were also in our ears saying, “Why don’t you guys go start your own thing?”

LOCATION: 7255

EDGAR BRONFMAN JR.: When Ron left, Mike went into a chasm. Eisner didn’t know that Mike had no choice. Mike would have gone there for a dollar. RON MEYER: After I left, given Mike’s deteriorating relationship with the group that had taken over, Mike probably had no choice but to take the Disney job. It was not a surprise to me.

LOCATION: 7389

Rapke, Lee Gabler, Ray Kurtzman, Bob Goldman, Sandy Climan, Tom Ross, Kevin Huvane, David O’Connor, Jay Moloney, Bryan Lourd, and Richard Lovett. (Rick Nicita was in Italy on vacation.) DAVID O’CONNOR: Michael comes in, sits down, and says, “It will be announced today that I’m going to become president of the Walt Disney Company.” KEVIN HUVANE: He came in and said, “It will be announced that I am now the president of the Walt Disney Company.” We were all just shocked. I don’t think any of us were expecting it. DAVID O’CONNOR: There was sort of this silence around the table, I’ll never forget this, and Richard in his inimitable way says, “Michael”—I have no idea where he’s going with this by the way, I look at him like, What are you going to say now?—“Congratulations! That’s fantastic!” RICK NICITA: We had taken a villa in Rome, in Trastevere, just gotten there on Sunday, and on Monday I call to check in and I get a message that Mike wants to see everybody and I go, “No can do”—here I am, you know? The next thing is I get a call from Martin Shafer, who ran Castle Rock. I return the call and he goes, “What do you think of that?” And I go, “What do I think of what?” He goes, “Ovitz.” And I go, “What about him?” Martin Shafer ended up telling me, because I returned my call too fast. I flew back that night. The vacation was two days. I flew back from Italy Monday night. Yeah, nightmare.

LOCATION: 7431

JASON HEYMAN: When UTA started in the early ’90s, it was as hot as an upstart agency can get. Sandy Bullock, Jennifer Lopez, Michael J. Fox, Mike Myers, Drew Barrymore—and CAA stole all of them, one after the other after the other. UTA agents weren’t trained to poach. We didn’t spend every waking hour trying to figure out how to make other agencies’ clients unhappy. JEREMY ZIMMER: Michael changed the entire agency paradigm, those guys were only created because Michael created the playbook. I’m not saying they wouldn’t have been successful agents but he basically gave them the whole playbook and said, “No, no, no, this is how we do this and this is how we walk and this is how we dress and this is how we talk and this is how we eat and this is what we do. This is how you threaten and this is how you woo.” He did the whole thing. He was incredible.

LOCATION: 7747

The Turks

There’d been many an inflow into the ranks of agents at CAA, but outflows were far less frequent, especially self-initiated ones. The system that Ovitz and Meyer had created—making it financially prohibitive for competing agencies to steal away their agents—had been holding up rather well since their own departures in 1995. Yes, there had been an initial, if somewhat limited, exodus in the first year of CAA 2.0, but the lineup had since stabilized for the most part. In the year 2000, however, the always tricky and emotional issue of partnerships reared its head, with the Young Turks trying to determine what might happen to partnership architecture in the near and distant future: Would other agents have real equity? What about voting rights on key matters? Bottom line, was there a real role for anyone outside Lovett, Huvane, Lourd, and O’Connor? Irony of all ironies. The Turks were now getting asked the very same questions they had asked—and demanded be answered—of Ovitz and Meyer. In the aftermath of the ’95 departures, the Turks had promised to create an ownership structure, something that was far easier to pledge than actually do. The issues surrounding its formation were delicate, but ones they wanted to control. Bruce Ramer, a highly regarded attorney with a client list through the years that included Steven Spielberg, George Clooney, and Clint Eastwood was brought in to help construct a plan. What surfaced was a “Membership” program whose agenda was fourfold: first, to limit dilution of equity; second, to protect the agency from any single or small group of agents who might threaten or pull off an exodus; third, to serve as a retention vehicle; and fourth, to create more of an “equity culture.” The membership program became a tiered partnership program with compensation tied to the performance of the company overall. Those who “belonged” also received an exit benefit—as long as you left and didn’t compete—which was one times the average of your compensation of the previous three years. For the Turks, it was two times. For the first few years, the program worked, due largely to the fact that revenues were really strong, but when revenue growth began to slow down for a while because overhead grew and margins decreased, membership compensation by formula also went down—a punch in the gut especially for high performers in their prime. It also disincentivized investment in new areas. Challenging economics had revealed the program’s deep flaws, and a series of philosophical debates about partnerships once again surfaced, even amongst the Turks. It all either started from or came back to square one—whether or not the inner circle of CAA was going to be a fluid one and grow as new leaders emerged. But the dirty little secret plan of the Turks was how could they keep the richest amount of cash flow (aka big money clients) with the least amount of dilution. There was a specific dynamic attached to the challenge. Inertia would keep young agents and…

LOCATION: 8642

PATRICK WHITESELL: That fall, when I went into my year-end bonus meeting, I was expecting to just see Richard as in years past. But it was Richard, Bryan, Kevin, and Doc, and I asked, “What’s going on?” And they said, “This is a great day!” They gave me a great bonus, told me how happy they were with me, and said, “We want you to be one of us.” I said, “What do you mean?” They said, “We want you to be our partner in the company. It will be you, Rick, us, and Lee Gabler.” I said, “Holy shit, this is great.” And then Richard said, “But here’s the thing: We have another year of paying off Mike, so we can’t change anything right now. But we’ll have it paid off in a year. All we ask is that you don’t talk about it to anyone, and in a year from now we’ll make this official.” ADAM VENIT: Richard was the type of guy—and I have no problem saying this publicly—who said all the right things but there was never anything behind it. And he would promise things and then nothing would ever really happen. PATRICK WHITESELL: Right around this time, Ari, who had set up Endeavor, called me. We had remained friends, and he said, “Dude, you should really come here. You can help us start a movie business and build it from there.” I knew how smart he and his new partners were, and they had a killer TV business already in place that you need when you’re going to start a new agency—it’s the backbone financially. I said, “Well, that would be cool, but the time is not right for me. The guys here want to make me their partner.” And I remember Ari saying, “Fuck, if they’re going to do that for you, that’s pretty awesome.” So the entire next year I worked my ass off and go in to get my bonus. Once again, I got paid well, but then I asked, “Hey guys, what’s up with the partnership, you know, being one of you guys?” And they said, “Well, we did get Mike paid off, but we have some restructuring we need to do, so give us until January and we will get back to you.” I was a bit confused, but said okay. January comes and I say to Richard, “Richard, what’s going on with the partnership?” And he says, “Yeah, we’re almost there, we think we have something together and we’ll come back to you in the next sixty days.” So now I don’t hear anything until April or May, right? I’ve been waiting over a year and a half, and he says, “We think it’s going to be you and Beth Swofford.” And I said, “Beth Swofford? You told me it was just going to be me. This is the first time I’m hearing about another person.” I left the meeting, and thought, Beth’s a great agent, she’s killing it, she’s doing really well. Why would I begrudge her getting something? But something didn’t seem right. I just said to myself, Bonuses come in October, and I’m not going to say a fucking word until then. It’s just five months. I will wait and see. LEE GABLER: They overpaid a lot of people because they were afraid they were going to leave, and made a lot of accommodations—this was on the motion picture side. None of that…

LOCATION: 8682

PATRICK WHITESELL: That October I get called up to Bryan’s house. They said, “We’re going to do this all properly; we don’t want to do it at the building.” Richard and Bryan are there and Richard tells me, again, “This is a great day. I know it’s taken a lot longer than we originally said, but we’re going to give you this partnership agreement. Take a look at the document. This is all very exciting. It’s going to be you and twelve others.” I looked straight at him and said, “Okay, great,” and left, thinking to myself, You’ve got to be fucking kidding me. Then I read the document over the weekend, and it was all bullshit. It was just a shitty profit participation program where you get X amount of points and there was a net pool. In addition, I would now have a noncompete clause for the first time. It was a joke. I was beyond being offended. I went into the office on Monday and told Richard, “I am not signing this. First off, I was told it was just going to be me. Then you added Beth and now it’s twelve. I don’t know what the fuck that is. And second, why would I ever sign this? I’m actually better off right now, I could leave at any time, I don’t have a contract and have leverage with you financially. This is insulting. I am never signing this.” So then Kevin talked to me and Bryan talked to me, trying to sell me on the agreement. They said, “You’re a leader, and this will be a big step for you. Maybe we can tweak a few things.” At this point I just said, “Stop. You know what, Richard? Let’s you and I have lunch.” And there I said, “Put the contract aside. What do you see my role being here as this company evolves?” And he says, “Well, I think what we do is hopefully you take over for me and you run the motion picture business. Bryan and I are working on some things and we need to be freed up in order to do that.” At this time, Richard was literally running the motion picture business every day. But the big thing that he never said was “You know, when I leave . . .” Everybody else at some point talks about when they are going to leave. He wasn’t. So now I was really pissed because (a) I’ve been lied to and (b) I was being played by people who are supposed to be your partners, who you are supposed to trust. When I left CAA, I said, “Richard, here’s the thing: if I stay, I will never be one of you guys. You guys grew up together. Even if it were just me,…

LOCATION: 8709

“What’s going on? We hear you’re going to Endeavor, that you’ve already made a deal.” My heart was beating so fast, but I did cop to it. I said, “I haven’t gone all the way yet, but it’s doable.” I wound up airing all the problems that were going on with me. We walked around the golf course there for about an hour. I was under a lot of pressure. They basically said, “We’ll take care of you, and match the deal you’ve been offered by those other guys.” I knew part of it had to do with the fact that Patrick had just left and they didn’t want it to start looking like there was going to be a bunch of people following him. I ended up recommitting to stay at CAA, which in retrospect was a mistake. It was hard to recover from that. From then on they looked at me as someone who could leave the company at any time. I just should have gone then.

LOCATION: 8755

pathways for revenues. One Turk in particular, however, was relieved, even excited, and became very interested in where the business was going to be five or ten years ahead. He started spending fewer days with traditional duties and pursuits and began devoting more of them to exploring the future. In theory, that move made sense, but it was also a risky one. Looking for new opportunities can be worthwhile, but when that journey cuts into duties associated with bringing money into the company, it becomes a dangerous one. Now there was a fissure in the family. And then there were the other agents—and clients—who would get caught up in the changes as well. The old rules were gone. The agency was shifting in subtle and not-so-subtle ways. The bar was higher for survival than in the past. And if you couldn’t pull that off, you might be told, “We entered your name into the computer—and it came up wanting.”

LOCATION: 8791

ANDREA NELSON MEIGS: When I left CAA it wasn’t because of some big blowout, but it was traumatic for me. All of my mentors had gone away. Ray Kurtzman had passed away; Patrick Whitesell had gone to Endeavor; Joe Rosenberg had left the business; Fred Specktor now worked for his former assistant, Richard Lovett, and the Young Turks who had taken over. I was in my review meeting and we were going over numbers and I thought their bonus numbers for me were low for what I had brought in. So I asked for a reconsideration of my bonus, because my guys were doing well. Cedric was making five million a movie, Jon Voight was making five million, Beyoncé was making five, Chris Brown had a two-million-dollar quote, and I had showrunners who were on the list of the top fifty, with two shows on the air. I had asked several people who were about the same level what they were getting and it was clear that I was nowhere near what the other guys were making. I wasn’t even at the low end of what the men were making. And my request to reevaluate was met with “This may be a good time for you to look elsewhere.” I was shocked; then I thought it was a joke. I thought that the next day they would say, “Let’s talk about this further,” but instead I got a call from one of the partners, who said, “I’d be happy to help you look elsewhere. Is there anyone I can call for you?” And I thought, Wow, this is real. I didn’t feel like I had a go-to person. So here I was, a dual degree, successful female African-American agent with a client just nominated for a Golden Globe, now looking for a new home. Once again, this was a reminder we just had to be better to get a shot. When I left, pretty much all of my clients came with me—Beyoncé, Chris Brown, Mara Brock Akil, Mary J. Blige, and others.

LOCATION: 9508

RICK NICITA: It wasn’t about more money. What did I really want? I wanted to have my health; I wanted people to treat me with respect; I wanted a good glass of wine; and I wanted to be with my beautiful wife. NICOLE KIDMAN: I was devastated when Rick left. I asked him, “Why?” I tried to convince him to stay. What I enjoy about life is the longevity of relationships, navigating through a long journey together if the person is honorable and decent and willing to do it. Obviously I’m not a masochist. I think if you’re committed artistically to a path, then you’ll stay the course, and if you’re not, you won’t. That’s what Rick really understood about me artistically. He knew I have really strange taste. After I won the Academy Award, I really wanted to make Birth, which some people couldn’t understand. They even said to me, “What are you doing?” But he was always supportive, and even joked, “You’re not crazy, you’re just idiosyncratic.” And he was right. Kevin and Rick were a balance for each other, so when Rick left and I was with Kevin, it took me awhile to move on, and then he set me up with Chris Edridge and that subsequently has been a really strong relationship, too. But the main person is Kevin. He’s always been there, for now well over two decades. I had a terrible knee injury on Moulin Rouge, and then subsequently I was doing Panic Room, and I had to pull out of Panic Room because I just physically couldn’t continue. It was pretty bad. I’d shot for two weeks on Panic Room, and he just told me, “We’ll get through this,” and we did. I think so much of a relationship between an agent and an actor is finding the true essence of what the actor is trying to do, and then helping formulate that path for them. That’s probably why I’m very loyal to Kevin, because I know the path I forge is windy and weird, and that’s not for everyone. I’m slightly naive, and kind of wide-eyed. I was raised in a very Catholic family, and my father was very moral with a strong social conscience—so I have what you probably would call a moral approach to playing out my professional decisions. I’m not so much talking about what the film is about, because I don’t believe I’m moral artistically all the time, but more in terms of the code I use when I either accept or pass on roles.

NOTE: The path. Like bjj, what Eddie said. Like career trajectory

LOCATION: 9590

DAVID O’CONNOR: Probably one of my proudest accomplishments while an agent at CAA came about when Rick Hess and I were looking at the animation space. We knew that there was a lot of money in family entertainment, but nobody was really paying much attention to it, and a lot of studios didn’t have a family entertainment strategy. While there was lots of money floating around, outside money was looking to get in. But there were very few people who could actually run the business, who actually had expertise in it. While all of this was going on, my really close friend from college Chris Meledandri called me up. He had created 20th Century Fox Animation and his deal was coming up and he wanted help and some perspective on what he should be asking for. So we sat down at lunch and I said, “Wait a minute, Chris, you don’t know how valuable you are.” I think Fox was paying him about a million bucks a year, and he had created the Ice Age franchise for them, which was billions of dollars of value. I said, “Here’s how we’re going to negotiate with Fox. On a separate track, we’re going to create a company that you’re going to run. We’re going to get off-balance sheet financing and we’re going to align you with another global distributor.” At the time we had at least three studios that would be great strategic fits. But he didn’t want to be an employee, he wanted real ownership. So we created parallel paths. On one track was the Fox negotiation, which I told him would take a year, and they would give him a 15 percent increase. They would grind it out and play hardball. I told him, “At the end of the day, they’re not going to pay you anywhere near what you’re worth. But on this other track, we’ll create this opportunity to change your life, for you to have something of your own.” I remember having a meeting with Mark Shmuger and David Lindy, who were literally in the first day of their new jobs as co-chairmen of Universal Studios, and Bryan, Richard, Kevin, and I met with them in their first official meeting and I pitched them the idea of being in business with Chris, and they said, “Yes. We want you to do it.” It took probably well over a year, but ultimately we created Illumination. Universal came in and financed the company 100 percent. They wanted to clean up their balance sheet because they were about to sell to Comcast, so we got paid an investment banking fee for $4 or $5 million, and then on top of that we’ve commissioned every movie that Chris has done. Chris got a very, very, rich deal, probably the best producing deal there is. The truth is, on Minions he’ll probably make $80–$90 million. To date he’s probably made hundreds of millions. And he’s got Despicable Me 3, and The Grinch Who Stole Christmas.

NOTE: Chris melendandri and illumination

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It’s been a thrilling ride. It is a nonstop job. Almost every evening there is a client function—either a preview, an opening, screening, premiere, or client meeting. I’m a big believer in 90 percent of new business happens after office hours, so there’s an edict in our department that you should be out every night. That’s where you find new business and you meet new people. We are all trying to be in the right place at the right time, to create new opportunities for our clients. To be able to do what you love—I’m the luckiest man in New York City.

NOTE: 90% of new biz comes after hours

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Sports

Following the Yankees deal, CAA property sales was retained by Madison Square Garden to sell top-level sponsorships for the arena. In October, Delta signed on a signature-level sponsorship partner at the renovated arena, a deal valued at $6 million per year. JPMorgan Chase would sign a marquee deal valued at $30 million a year. And there were more. And more. At the time, few in Hollywood—even at CAA—realized the potential that sports held for the agency and its future, although such was not the case up in San Francisco. Meanwhile, back in Beverly Hills, Endeavor—founded in 1995 by Ari Emanuel, David Greenblatt, Rick Rosen, and Tom Strickler—while never as large as CAA, was blessed with personalities who made it far more than just another blip on the CAA radar. The agency had a swagger that was much larger than its footprint, and this made rumors of a merger all the hotter. Endeavor had brought the word “entrepreneurial” front and center to clients and potential clients by promising them not just jobs but that virtual companies would be built around them. The relatively feisty firm had made inroads into CAA’s television business and, particularly with the arrival of Patrick Whitesell, had managed to establish an impressive beachhead in the motion picture business as well. Finally, after weeks of anxiety and speculation, a merger was announced, on April 27, 2009, between brash young Endeavor and crusty rusty Old Ironsides—aka William Morris. The actual day of the first combined WME meeting was, some would later recall, “surreal.” The matter of which building would house which offices was settled fairly quickly when Endeavor’s quarters dominated as the meeting place of choice. Matters of detail—like who would design the combined companies’ new logo—tended to come down on the Endeavor side. In some circles, the action was seen not so much a merger of two companies as a much-needed management upheaval at William Morris. “Upheaval,” indeed, and it would be a long while before a creative calm settled in. Nearly two hundred and fifty agents were let go the first day, and months of instability would follow. Initially, the new ruling board was nine members large, with Jim Wiatt of William Morris in the top slot, followed by co-CEOs Ari Emanuel and Patrick Whitesell of Endeavor and David Wirtschafter of William Morris. The clash in sensibilities could be most readily seen in the behavior of those at the top in both agencies. It was obvious that not all of these personalities, colorful or bland, would survive. Employees including executives spent much of their time surveying their coworkers and wondering, or coldly calculating, who would live (stay) and who would die (be trampled in the merger). Tension was palpable everywhere. Many believed Wiatt was essentially flogged by his own troops, and before anyone could scream, “Entourage,” Emanuel and Whitesell were installed atop the newly formed agency. The event further suggested less the melding of two…

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MICAH GREEN, Agent: Our goal simply put is to enable the production and successful release of as many great films each year as is humanly possible. We do this without regard to whether the major studios want these movies to exist or not. One way we do this is by acting as strategic adviser to film investors and funded production companies. We work confidentially on behalf of very well-capitalized investors to find the strongest projects available, and to assemble them with the very best talent we can find, with rational budgets and well-considered distribution plans. Here, before clients lock into a project, before they have decided exactly what their movie is going to be, we have conversations about their vision for the project, and where it can fit as a commercial proposition within the marketplace. We try to answer several fundamental questions before we begin pitching it to investors. How can it best be realized in the film business as it exists today? Is it likely to be fast-tracked through a studio’s internal development process, or can we increase the film’s odds of getting made by keeping it independent through development and packaging and presenting it to studios as a complete package or even as a finished film?

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RON HOWARD: The studio system is shrinking, but there are so many other ways to get projects going at an agency like CAA. They have relationships with financiers, companies, and distributors. It’s about trying to find that intersection point between what their client base, their talent, has to offer and what the marketplace will bear. I think they do it well, and I think they continue to do that thing that I care about the most, which is to allow a person like me to be able to connect with talented artists I want to work with.

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entire market. What was customary for independent financiers a few years ago, and is still the norm at studios, is that the studio options the underlying material for the film, and then controls the project for the duration of a term, which can be several years or more. What is most challenging about this is that this shift in control occurs prior to a commitment to actually fund the project’s production. A project can therefore be held up or killed entirely if the filmmaker finds herself or himself at odds with the studio over creative or financial choices that arise during development or packaging. Our agency has worked to change that norm, particularly within the independent realm, encouraging financier-producers to work alongside talent as collaborators rather than gatekeepers. The companies we advise have been great partners in this respect, and have really helped transform the nature of the relationship between filmmaker and financier. Their approach is often to attach to a project at an early stage and fuel its development and packaging. They work collaboratively to arrive at a package and budget that the filmmaker is happy with and which they feel comfortable greenlighting. At the same time, most of these companies are determined to play the role of facilitator for artists and not to risk being perceived as obstructionist, so where they find themselves out of sync with a filmmaker, they will generally let them take the project and move on to other financiers rather than hold up its production.

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DAVID OYELOWO, Actor: I’ve always felt that my agents are my employees. I pay them a wage whenever I work, and on that basis, they work for me and their job is to help me realize my goals. I think a lot of actors think they work for their agents; they are so happy to have an agent and give too much weight to the direction in which their agent wants their career to go. My goal every day is to outwork my agents so that they are inspired to work harder for me. I don’t think there’s any agent who wants to feel like they have to put dead weight on their back and try and sell it to the world.

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Clearly for Ari Emanuel and Patrick Whitesell, merging their Endeavor agency with William Morris was simple foreplay, hardly enough to satisfy them. And so it was on December 18, 2013, WME and Silver Lake announced the acquisition of IMG for $2.4 billion, with Emanuel and Whitesell to serve as co-CEOs of the mega-agency. It was a startlingly bold purchase given the price—an amount so lofty that CAA, ICM, and a group lead by former Fox topper Peter Chernin didn’t come close to with their bids. The response to the sale focused more on the price than whether the deal made sense or not, but WME was convinced it was the ace in the deck—and that the competitive landscape would be fundamentally altered as a result. ARI EMANUEL: When we took over IMG, it was a motherfucker. It’s now nineteen-hour days, seven days a week, 365 days a year. You’ve got to want that fucking piece of bread more than the other guy. Simple as that. When Richard Lovett heard that Patrick and I were talking to Teddy [Forstmann] and he thought we were going into sports, he got into sports, without any conception of what sports was or what to do in it. Then he picked the shittiest business in sports, the team sports business, where commissions are locked in by the guild. I mean, he’s a moron. He has not done one innovative thing in the company. We’re four times the size of CAA Sports. I mean, it’s a joke now. It’s truly a joke. MIKE RUBEL:

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MARK SHAPIRO, Chief Content Officer, WME/IMG: CAA spends a lot of time talking about the price WME paid for IMG, but that’s so foolish. It’s all in the eyes of the storyteller. We had to pay what was necessary to get the fuel for this enterprise to jump to the next level. Yes, our bid was materially higher, but we didn’t want a second round of bidding. We wanted to avoid a bake-off. We were confident in what the two combined assets could become. IMG actually didn’t want to sell to CAA or WME. They didn’t want to sell to an agency, but we prevailed anyway because the headline price was a deal they couldn’t refuse. HOWIE NUCHOW: If they pull this off, I’ll tip my hat and say, “God bless.” I think it would be great for everyone. PATRICK WHITESELL: They went into sports the way they did because we were looking at Arn Tellem. But the more we looked at it, we saw it was a shitty business at scale with low margins. If I have a hundred football players, what does that really do for my television business or my movie business? There’s no vertical integration. What we liked about IMG was that it was only 10 percent high-end representation and 90 percent assets you can actually control and own. We aren’t in the sports representation business like what they’re doing. We are after huge growth and a way bigger business. I couldn’t sign enough actors to do what we’re going to be doing this year alone with our sports business. DAVID O’CONNOR: I didn’t want IMG at all. We thought IMG was a mess, and I was not a believer in their college business. We were unanimous in that. Richard probably overall was the greatest proponent of it but at the end of the day when we really started to look at it and really understand what IMG was, nobody wanted to do it. We were all very clearly against it at the end of the day, and happy to be out of it. JIM COULTER:

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For several years, slowly, CAA had been losing its grip on at least its perceived dominance. WME’s 2013 purchase of IMG meant that agency was now bigger and, some said, bolder than CAA; certainly sports was a more complicated battlefield as a result. And then another front opened with the March 31, 2015, defection of ten CAA agents to UTA, including an entire comedy bench lead by CAA veterans Gregory Cavic and Gregory McKnight, and including the highly regarded Jason Heyman, Marty Lesak. and Nick Nuciforo—who were still under contract when they departed. Among the clients taken by the defectors: Will Ferrell, Chris Pratt, Zach Galifianakis, and Ed Helms—but not, after a furious CAA effort that played to her dramatic aspirations, Melissa McCarthy. The CAA spin was they wouldn’t miss the agents; they were grateful for the reduction in overhead and the years of commissions they would still hold on to for several more years, but they needed to send a signal to anyone else—inside or out—contemplating such a move in the future. It was too early to know whether the migration would ultimately be a financial win or loss for either agency, but one group of professionals was sure to cash in: the attorneys hired to sort out the legal ramifications of the defections. Within weeks, CAA was at Los Angeles Superior Court with a suit attacking “a lawless midnight raid that UTA and its co-conspirators [the defecting agents] launched against CAA in a desperate attempt to steal clients and employees.” There were nearly twenty pages of accusations, bitterness, drama, and industrial-strength victimization in the CAA suit: “Months in the making, this illegal and unethical conspiracy has resulted in a number of agents who were under contract to CAA to brazenly and abruptly breach their contractual obligations to CAA and to intentionally and deliberately interfere with CAA’s existing and prospective economic relationships with its clients.”

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For many of the years following Jay Moloney’s tragic death, there had been not so much four remaining Young Turks at the agency as there were three-plus-one. More and more agents inside, and keen observers outside, could tell there was less and less respect and affection flowing between three of the Turks—Lovett, Lourd, Huvane, and the fourth, O’Connor. It was as if the four were in a special room, with a secret entrance through which only Lovett, Lourd, and Huvane were then allowed to go. This segregation was often subtle, sometimes passive-aggressive—until, that is, the second tranche with TPG was completed. That’s when the ostracization took a financial turn. For the first TPG transaction, the four were reputedly in the same zip code, receiving payouts commensurate with their ownership percentage in the agency. O’Connor got about $25 million, with Lourd and Huvane closer to $30 million and Lovett slightly over this. On the second transaction, the partners cashed out the “Membership Program”—i.e., an exit benefit and net present value of salary reductions previously agreed to. It amounted to two years of compensation and so, once again, the numbers were relatively close, with each man earning approximately $20 million. But this time there was a judo chop at the end. The remainder of the proceeds was in the hands of a “Comp Committee”—reportedly just Lovett and Lourd—and this time, Lovett, Lourd, and Huvane each were granted another $20 million in discretionary proceeds. O’Connor was told he would not be getting any discretionary funds.

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MARK SHAPIRO: Last year, we all pitched to BMW for some of their business, and our presentations were spread out a bit, and CAA was leaving as we were pulling up, and I kid you not, they were getting in their cars and they were Mercedeses! To a BMW pitch! That’s the kind of thing that would never have happened under Ovitz. JEREMY ZIMMER: They get punched in the nose now, and they freak out. If you punched Mike Ovitz in the nose, he would spend the rest of his life fucking killing you. It’s a very complex time right now in our industry and there are many different weather patterns happening. The theatrical movie business is changing; streaming services are evolving; and the entire underlying revenue structure is up for grabs. No one really knows how it’s going to sort out.

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Ever since its creation in 2006, CAA Sports has been the most divisive force on Planet CAA. Competitors think it’s a disaster and loss leader; CAA and, perhaps more important, TPG, believe it to be a growth story tour de force. Even inside the agency debate has raged about whether the move toward the playing fields has been sheer strategic genius or hubristic disaster. To the very select few at CAA who have access to the numbers, it is now not worthy of debate. For decades, television and movies were the primal forces that made CAA the most powerful and profitable agency in the business. No longer. In 2015, Sports, for the first time in the agency’s history, was the agency’s top revenue producer, bringing in more than $215 million. Motion Pictures, the leader in championship seasons, reportedly crept close, but failed to break the $200 million mark, with television cashing in at around $160 million. The revenue baton had been passed. HOWIE NUCHOW: We had tremendous growth again this past year. Whoever says we’re not succeeding is either naive, stupid, or doesn’t mind lying. It’s only one of the three.

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Both CAA and WME/IMG are structured in ways that might have seemed outlandish a few decades ago. CAA is 52 percent owned by TPG, whose roots and primary focus lie, generally speaking, far from Southern California sunshine. WME/IMG is now on the receiving end of investments from Silver Lake, which has the largest stake in the company at 49 percent, Softbank, the Japanese media and telecommunications giant, that has 8 percent, and Fidelity Management, which has roughly 2 percent. (WME/IMG holds approximately 41 percent of the company’s equity, and there are several smaller investors as well.) WME/IMG’s estimated market cap is around $5.6 billion, compared to CAA’s just over $1 billion, with WME boasting more than twice the workforce that CAA employs. Almost immediately after the receipt of these aggressive caches of capital, speculation intensified about which company—if either—would be going public in the near future. The short answer is, in all likelihood, yes, and WME/IMG will probably be first. Given their particular approaches, the ways in which each reached this point are distinctly separate. WME’s bet has been audacious—picture “all in” in a game of “Hollywood Hold ’Em.” Co-chairman Ari Emanuel and Patrick Whitesell play the gumption game better than most in Hollywood, and a lot of what is going to happen prior to the company filing to go public will depend on how closely results mirror their bold pronouncements. Considering their $2 billion in debt, challenges with their college licensing business, and the need to find cuts of around $75 million, it’s easy to predict, however glibly, that WME/IMG will be either a grand slam or a grand flameout. Given the stakes and personalities involved, a scenario somewhere in between appears less likely. CAA’s path to a public offering seems a far more “businesslike” ploy that does not need a cult-of-personality leader capable of parting the sea. CAA eschewed the big shopping trip and went largely with a build-your-own approach, making their debt a considerably lower $600 million—an imposing sum, yet not as dramatically different from WME/IMG on a relative basis. That lower debt, and TPG’s patient profile, suggest that CAA has more time to grow before filing. Going public will not just mean more for the agencies; it will mean potentially tens of millions of dollars for employees who have a piece of the current pie…

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MARK SHAPIRO: We paid a considerable price for “Miss Universe” from Trump. As you might imagine, the negotiations weren’t easy. But we got through it, and we were all on board for the first WME/IMG Miss Universe pageant. Ari and I were both there that night. We met with Steve Harvey prior to the show, and during the show I was in the truck, headset on, locked in. About three quarters of the way through, Ari said to me, “This show is night and day from what it was last year. I’ve got to catch a flight. Let me know how the rest of it goes.” Other than our site going down from an overload of on-line voters, the rest of the way was smooth. Then of course, Steve said, “Miss Colombia,” and it was bedlam in the truck. To Steve’s credit, he kept cool and did what he had to do, but when Steve came clean on the mistake and gave the crown to Miss Philippines, then there was also bedlam in the theater. I called Ari from the stage to give him a heads-up. He was literally on the runway about to take off. He couldn’t hear me at first; all I could hear was him yelling to the pilot, “Don’t take off yet, don’t take off yet!” And then I told him what had happened. Give that report to 99 percent of the executives in our business and they would have gone directly into crisis mode, deplaned, and headed back to the theater. Not Ari. As he often does, he instantly saw it from another angle, complete with upside. He knew right away all the attention the property would receive as a result of this. I told him what had happened and he immediately said, “Fuckin’ fantastic!” And hung up. Two months later, Fox extended our contract.

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Meizlik make the difficult look easy, and day in and day out, Madeline Jaffe exhibits acumen way beyond her years. Heather Karpas and Colin Graham are always a pleasure and always come through. Annie Lee at CAA, and several of her other assistant colleagues there were gracious and truly helpful. The Special Ks—Kris Fujihara, Kristina Walker, and Kari Zirkle—make life easier. Others at agencies, studios, networks, and production companies showed hospitality that was equally appreciated.

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