SHOWDOWN at FORT SUMNER Two Years After Paramount Purchased Dreamworks, Hollywood Is Transﬁxed by One of the Nastiest Breakups Ever

Home , Bad Blood (2003), Brad Grey, Philippe Dauman

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S H O W B U S I N E S S ROYAL RUMBLE From left: Sumner Redstone, Brad Grey, Philippe Dauman, Shari Redstone, Jeffrey Katzenberg, Steven Spielberg, and David Geffen.

SHOWDOWN AT FORT SUMNER Two years after Paramount purchased DreamWorks, Hollywood is transﬁxed by one of the nastiest breakups ever. As Sumner Redstone and David Geffen went to war (over Steven Spielberg?), the author got it from both sides

BY BRYAN BURROUGH here was a time, not long after new home in a gated community above Bever- and the Palm, the gossip about Redstone is Sumner Redstone came to South- ly Hills, where he spent his days tending tropi- withering: among the agents and producers in ern California four years ago, when cal ! sh, taking phone calls, and shaving nude Hollywood’s chattering class, he is increasingly the world must have seemed rosy in his hot tub. Sylvester Stallone lived next viewed as an isolated, mean-spirited old man and new and full of hope. At 82, door. He ate out every night. Life was good. who cares nothing for the film community’s an age when peers were dead Not anymore. By late summer Redstone traditions. All summer the ill will bubbled up or lying in retirement homes, Redstone had had begun squabbling again with his daughter, into a series of unflattering media portray- everything a mogul could want: between his Shari, 53, who runs National Amusements, the als—much of which Redstone now blames on two main companies, Viacom and CBS, he family’s movie-theater chain, and reportedly the man he has come to believe is behind not Towned a television network, cable channels by fighting with his wife, Paula. At the same time, only the bad press but almost all of his “image the score, and not one Hollywood movie stu- relations between Redstone and the influential problems’’ in the broader Hollywood commu- dio but two—Paramount, with its sprawling Geffen-Spielberg-Katzenberg troika—incensed nity: David Geffen. lot, seized in a takeover ! ght 10 years before, by a stream of perceived slights—had deterio- In a series of talks with Vanity Fair begin- and his newest acquisition, DreamWorks rated into a nasty cold war, to the point where ning in August, Redstone’s men have blamed SKG, home to Steven Spielberg, Je" rey Katz- it is widely believed Spielberg and Geffen will Geffen, the mischievous music turned film enberg, and David Ge" en. On top of all that, resign the moment Spielberg’s employment magnate, for practically every bad press notice Redstone had a sparkling young wife and a contract expires, next fall. Down at the Ivy they have received, even the reports of trouble

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in Redstone’s marriage. “This is all Geffen,” chief, Paramount’s Brad Grey, a veteran tal- Ovitz—who after leaving his all-powerful po- an executive close to Redstone told me. “We ent manager and producer but a newcomer sition atop the Creative Artists Agency found know what’s going on. He’s doing all of this. as studio executive, still unsure of his foot- himself vulnerable to press attacks—and He’s relentless. He and Sumner, when they’re ing, yet eager to assert his leadership over Redstone, a multi-billionaire who doesn’t in a fight like this, it’s war. It’s war.” the proud DreamWorks team. Spielberg, cut deals with studios. He owns studios. When I first relayed these sentiments to the legend, comfortable in his routines, “You’re right, you can’t take down Sumner Geffen, he exploded. “Whoever said these suspicious of change, ever respectful of Redstone,” the adviser admits. “But in a things, they must be out of their minds,” he Hollywood tradition. And Geffen, hyper- Sumner Redstone situation, you can expose said, his voice rising with each syllable. “I am protective of Spielberg, easy to o! end, only him. He’s already damaged.” not responsible for the public discourse about fully engaged, it seems, when consumed by Mr. Redstone at all. He is. To imply I have some epic life-or-death struggle. hy on earth did Ge! en launch a anything to do with his image problems is Whether or not you believe Ge! en was crusade against Redstone? For a just shameful. The lawsuits with his children behind the spate of anti-Redstone articles W time, the conventional wisdom was and the statements he has made on the rec ord this past summer, there’s no denying his un- that he was trying to drive Redstone to the speak for themselves.” happiness triggered all this. bargaining table to get something he wanted: But Ge! en, who to his credit ENDLESS SUMNER In fact, the sheer vehemence a better deal for Spielberg at Paramount, or had no problem speaking on the Brad Grey and of Geffen’s anti-Redstone the sale of DreamWorks Animation—now an rec ord, was only warming up. Sumner Redstone. fervor reminds more than independent company run by Katzenberg— “I don’t care for Sumner’s be- Redstone reportedly one observer—including this to Viacom. Inside the Redstone camp, the havior,” he went on, “and I have regaled dinner-party feeling was that Ge! en had his eye on an exit that in common with a great guests with Grey’s strategy for when Spielberg’s contract with many people in the entertain- stories about Geffen’s Paramount expires, next fall. Either this was unpopularity. ment business. I don’t like the a ploy to coax more money out of Redstone way he treats people. Most of or—and this was the guess you heard most all, nobody is going to treat me or my often—it was Ge! en’s strange way of placing partner [Spielberg] in that manner and a FOR SALE sign on DreamWorks. stay in business with us. Nobody.” On the rec ord, Redstone’s men refused It was this level of behind-the- to parry with Geffen for this article. “We scenes vitriol that spawned the first will not engage in tit for tat,” says a Viacom serious broadside in the developing spokesman. “Steven is a great talent whom Redstone-DreamWorks " ght, in mid- we all treasure. We are taking the high road.” September, when Viacom’s C.E.O., Speaking for background, however, they are Philippe Dauman, told an audience of more than willing to talk trash. “We know New York investors and analysts that why he’s doing it—it’s obvious,” says the Red- Paramount could survive the depar- stone adviser. “Because next year Paramount ture of Spielberg and Ge! en. In one will have the hot hand. DreamWorks won’t. of the more memorable smackdowns Look at the slate [of planned movies]. Every- in recent Hollywood history, Dauman thing good is coming from Paramount. The characterized the potential loss of DreamWorks " lms don’t look anywhere near Spielberg as “completely immaterial.” as good. So if you’re Ge! en and you want to Katzenberg immediately " red back, negotiate, you want to do it now. He’s look- defending Spielberg in remarks that ing for any leverage he can " nd on Sumner.” ran beneath one of Variety’s tradition- ally clever headlines: KATZ SHOWS CLAWS. Still, Redstone’s team was happy with the exchange, feeling they had put the Dream- “I WILL NOT BE BULLIED. Works trio, especially Geffen, in their I AM ABSOLUTELY UNAFRAID OF places. “They don’t scare us,” a Redstone executive told me not long after. “What are SUMNER REDSTONE,” SAYS GEFFEN. we supposed to do? Bend over some more? Uh-uh. No more. This is it.” one—of the decade-long campaign he waged Ge! en hotly denies this. “Absolutely not Tough, tough talk for a tough, tough town. against Michael Ovitz, the onetime Holly- true,” he says. “I want nothing from these But how much of it was real? How much of wood superagent who, in a 2002 Vanity Fair people. Nothing. This is not about money. it was simply Hollywood-style posturing? pro" le, memorably blamed his downfall on It is my job to look out for Steven Spielberg Did the Redstone-Ge! en " ght involve gen- Ge! en and a cabal of allies he termed “the and Je! rey Katzenberg and our employees uine bad blood or was this all just silliness Gay Mafia.” While Geffen always denied and the people we are in business with. We and drama in an industry that makes its leading an anti-Ovitz jihad, there was no have a responsibility here. I chose to sell this money selling silliness and drama? doubt that he regularly launched into anti- company to Paramount. It has turned out to Ovitz tirades for the benefit of reporters, be a poor choice. To me, it’s about protecting II and was an important source of anti-Ovitz these people. That is my goal and my raison ou could see this coming for months. gossip. To my surprise, even a DreamWorks d’être. Redstone, he is accustomed to bully- All the ingredients were in the pot; it adviser acknowledges the parallels. ing people. And I will not be bullied. There S I

just took time for things to come to “Yeah, it took a while, but he did take is no " ght I will run from. I am absolutely V R U

Y P

a boil. Redstone, the imperious East Coast down Michael Ovitz,” this person says. “This unafraid of Sumner Redstone.” N

elder, unaccustomed and thus unwilling to is like David’s version of a board game.” What’s really driving Geffen, most observ- O R Y

kowtow to Hollywood royalty. His studio Yet there is a vast difference between ers believe, is a deep-seated desire to placate B

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the most important partner he has had in Stacey Snider. In mid-2005, Ge# en entered Works’ employees moved into new o! ces on a long and illustrious career. “This is all into talks with Meyer and NBC Univer- the Paramount lot, Spielberg stayed put in the about Steven Spielberg,” the DreamWorks sal C.E.O. Bob Wright about purchasing old, southwestern-style complex at Universal. adviser says. “David is doing this to keep DreamWorks. He had just brokered a ten- “I remember talking to Steven right after Steven happy.” tative deal when an especially expensive the sale, and he was already [having second In an odd way, the Redstone adviser DreamWorks production, The Island, a thoughts],” says a longtime friend. “He had agrees. The Redstone camp believes Geffen is science-" ction thriller with Ewan McGregor such an emotional reaction. He was leaving suffering from “seller’s remorse,” that is, sell- and Scarlett Johansson, $ opped at the box his home of 20 years. He refused to move to ing DreamWorks to Paramount for too little o! ce. G.E. reacted by trimming about $100 Paramount. That pretty much says it all.” money. That, they charge, and not any slights million from the price it was willing to pay. felt by Spielberg, is behind Geffen’s anger. It was then that Ge# en turned to Brad t was a di! cult marriage from the start, “Can you imagine how [Geffen] feels?” the Grey, who had just taken the reins at Para- although not nearly as rocky as some ac- Redstone adviser asks. “He told Spielberg he mount. The two had a good relationship; I counts portrayed it. In the post-deal trim- would take care of everything. He’s supposed Ge# en had been among those to urge Via- ming of duplicate jobs, there was a percep- to take care of the busi- com’s then C.E.O., Tom Freston, to tion that DreamWorks executives won most ness side, right? And he CRUISE CONTROL top positions, leading to the got taken. Well, tough!” Tom Cruise and Tom inevitable morale problems What Geffen fears, the Freston in New York among Paramount veter- Redstone man alleges, is City last year. Freston ans. Some DreamWorks losing Spielberg as a part- and Grey decided not executives, many of whom ner. The DreamWorks ad- to renew the actor’s clearly viewed themselves as Paramount contract. viser chuckles at the idea. too cool for this new school, “That’s not going to hap- struggled to hide their sense pen,” this person says. “Let’s be clear: of superiority, and no won- Steven needs David. David is richer der—in every sense that mat- than Steven. That will not change.” tered, the accomplishments Understanding all this—the charges, of Geffen, Spielberg, and the countercharges, the public mo- even Katzenberg towered tivations and the hidden ones, the above anything on the Para- spin on the spin—isn’t as di! cult as mount executives’ résumés. it might at " rst appear. Like almost “It took about a minute every marriage gone bad, you just to realize these people didn’t have to start at the wedding. know what they were doing,” says the DreamWorks III adviser. “Tom Freston was y the summer of 2005, it was a cable-television guy. He clear to everyone at the top hires Brad Grey, who’s B levels of DreamWorks SKG that their dream of running an independent studio was no longer possible. DreamWorks had been the product of another bitter feud, “GEFFEN’S SUPPOSED the early-1990s struggle between Katzenberg, TO TAKE CARE OF THE BUSINESS SIDE. . . . then Disney’s studio head, and his boss, Mi- chael Eisner. When Katzenberg was " red, AND HE GOT TAKEN. WELL, TOUGH!” Ge# en and Spielberg formed DreamWorks for him to run. In the intervening years, the hire Grey in the " rst place. Paramount was never run a studio. And Brad turns around trio made a slew of hit movies—from the ani- the sick man of Hollywood and had been and hires another television person, Gail mated Shrek series to Saving Private Ryan for years. Grey saw the purchase of Dream- Berman, who knows nothing! You had three and Gladiator and American Beauty—but nev- Works—Shrek and Spielberg and a dozen people who had never run a studio!” er attained the scale needed to safely weather strong movies in the pipeline—as an elixir And yet, it was Paramount’s very weak- the occasional flop. The poor showing in 2003 that would cure all Paramount’s problems. ness, many believed, that made it so attrac- of the animated Sinbad: Legend of the Seven The talks were far from smooth—Redstone tive to Geffen as a merger partner. More Seas, which lost $125 million, almost bank- initially rejected Ge# en’s demand for $1.6 DreamWorks workers would keep their jobs, rupted the studio. By early 2005, Spielberg billion as far too high—but once Viacom and, it was widely thought, Ge# en expected was making noises about their churning out struck a deal to sell DreamWorks’ " lm li- to dominate the inexperienced Paramount fewer movies each year—6 to 8, as opposed brary to a group of New York investors led team. His post-merger decision to hire Uni- to 12 to 14—and everyone involved realized by George Soros, it reduced its investment versal’s Stacey Snider to run DreamWorks it wouldn’t be enough to keep DreamWorks to a more manageable $600 million. The beneath the Paramount banner was viewed " nancially viable. deal was " nalized in December 2005. as a way of positioning an ally to take over The answer was obvious: a merger with Everyone seemed happy—everyone, that for Grey if and when he stumbled. Universal Studios, now owned by General is, except Spielberg. By one account—denied Still, despite a di! cult transition period, Electric. Spielberg has maintained offices by everyone at DreamWorks—he was so un- relations between the DreamWorks and Par- R

U on the Universal lot for three decades, and happy at the collapse of the Universal deal he amount camps remained generally peaceful Z A

M all the DreamWorks principals felt com- didn’t speak to Ge# en for weeks. At the very in those early months. Insiders give much of

I fortable working with its president, the least, he was deeply ambivalent about work- the credit to the calming in$ uence of Fres- V E

K soft-edged Ron Meyer, and his studio chief, ing for Paramount. While most of Dream- ton, who was friendly with all the principals,

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especially Geffen. “Things were actually other suggestion from Ge# en that Viacom said it was important that he say something, going O.K. internally,” says a Paramount purchase DreamWorks Animation. Ge# en because there would be members of the partisan. “The DreamWorks guys weren’t in and Redstone didn’t speak for a year. Viacom board in the audience. Ge# en was the strongest position, remember. Their ! rst Had Freston remained in place, it’s entire- beside himself. The night of the premiere, three movies, The Last Kiss, Flags of Our ly possible he could have calmed the waters. Press took Grey aside and pleaded with him Fathers, and Flushed Away—none of them With his departure, however, Brad Grey was to stay seated, and director Bill Condon was did anything. They actually took a $100 left to fend for himself, and Grey and his even sent over to second the request. But million write-down on Flushed. But then, team swiftly proved unable to keep Dream- Grey went ahead anyway, giving the impres- toward the fall, things began to change.” Works happy. Less than two months after sion that Dreamgirls was a Paramount ! lm. Freston’s firing, Paramount’s distribution He made a similar speech at the movie’s Los he first tremor came eight months chief, Rob Moore, was quoted in The New Angeles premiere. after the merger, in August 2006, York Times blaming director Clint Eastwood Ge# en’s anger only intensi! ed when Red- T when Redstone suddenly “! red” Tom for the disappointing performance of Flags stone was quoted in Nikki Finke’s gossip Cruise from a Paramount production deal; of Our Fathers. “The biggest draw of the blog, telling a dinner party that Grey had though it had been Grey and Freston who movie is its director, who’s not in the movie,” explained to him that Dreamgirls’ failure to decided to let Cruise’s deal lapse, it was he claimed. Like Redstone’s castigation of win an Academy Award nomination for best Redstone who, in a series of interviews, Cruise, it was a moment when a “suit” pub- picture occurred because “everyone hates blamed Cruise’s erratic behavior—jumping licly took “talent” to task, and across Holly- David” Geffen. “That was big,” says the on Oprah’s couch, etc.—for disappointing wood the talent didn’t like it one bit. DreamWorks adviser. “That was a big mark ticket sales for Paramount’s Mission: Impos- “I remember that morning, the whole in the road.” sible III. Redstone clearly enjoyed his mo- town was like, ‘Did he really say this?’ ” ment in the sun, but his criticism of Cruise recalls the DreamWorks adviser. “This is y early 2007, every week seemed to broke one of Hollywood’s long-standing Holly wood—you just don’t do that! You bring a new disagreement between B DreamWorks and Paramount operat- ing executives. A January Los Angeles Times article reported that Stacey Snider had heat- “THESE PEOPLE ARE edly objected to a press release Grey’s of- A NIGHTMARE,” SAYS GEFFEN. ! ce issued that lumped her in with others reporting to Grey; it was true, but Snider, “I’VE NEVER SEEN BEHAVIOR LIKE THIS.” who as DreamWorks C.E.O. had the ability to green-light ! lms on her own, took o# ense commandments: Suits Do Not Publicly simply say, ‘It was a great movie,’ and let it at the tone, leading to a sharp telephone ex- Criticize Talent. In the DreamWorks camp, go. Well, all you need to know is Clint East- change with Grey. Spielberg, meanwhile, was no one is more respectful of Hollywood wood is Steven Spielberg’s idol.” Spielberg growing irked at Grey’s tendency to refer to tradition than Spielberg, who was irked by felt Eastwood had been publicly humiliated DreamWorks movies as Paramount movies. Redstone’s comments. Ironically, the inci- and, according to several sources, demand- “I take exception when the press is contacted dent came at a time when relations between ed and received a meeting with Moore, who by our friends and partners at Paramount, Spielberg and Cruise were poor. Spielberg tried his best to mollify him. who refer to every DreamWorks picture as a felt the actor’s antics had hurt his own Paramount picture,” Spielberg told The New movie, 2005’s War of the Worlds. Far worse, IV York Times in February. “It is not the case.” though, had been an episode when Spielberg ut Spielberg’s irritation at the Cruise (Through a spokesman, Spielberg declined told Cruise the name of a doctor who had and Eastwood incidents paled before to comment for this article.) prescribed medication to a relative and the B the behind-the-scenes drama over As tensions rose, the most common flash doctor’s o" ce was subsequently picketed by Dreamgirls. The big-budget musical had been point took the form of nasty exchanges be- Scientologists. Ge# en’s baby for almost 25 years, since it had tween the longtime DreamWorks press The Cruise dismissal, however, was noth- debuted on Broadway. He had been involved handler, Terry Press, and Paramount’s P.R. ing compared to the sudden ! ring of Fres- in every detail of its production, and as the woman, Janet Hill. Hill blamed Press for ton as Viacom’s C.E.O., two weeks later. movie’s New York premiere approached, last un$ attering references to Grey in the New Now it was Ge# en’s turn to burn. Ge# en, December, he had strong feelings about how York Post’s “Page Six” and other gossip col- for whom much of business is personal, had he wanted the evening handled. Most of all, umns. Press criticized Hill for allowing Grey’s felt he was selling DreamWorks to Freston; he wanted a “cold opening” (that is, for the name to be drawn into media coverage of the he barely knew Redstone and didn’t much movie to begin in darkness, without the usual Anthony Pellicano wiretapping investigation; like what he saw. Worse, he felt the abrupt endless introductions from the studio head nor could she understand Grey’s willingness to dismissal showed a lack of respect for and director and pre–curtain calls for the ac- announce a separation from his wife, Jill, in Freston’s 26 years of service. “There was tors), the better for the audience to appreciate Liz Smith’s gossip column. The situation had a loyalty issue for David,” says the Dream- its rousing, spectacular ! rst scene. erupted spectacularly at the 2006 Cannes Works adviser. “David was deeply loyal The request was initially routed to Par- Film Festival, when Hill angrily blamed Press to Tom Freston, and he couldn’t fathom amount’s public-relations representative, for talking to a gossip columnist. When Geffen how Tom could just be fired like that. It Janet Hill, who rejected it. She said Grey got wind of this, he stalked into the Vanity Fair was insanity to him.” The DreamWorks had remarks he planned to deliver before dinner at the Hôtel du Cap, barking, “Point adviser con! rms a widely reported phone the movie began. DreamWorks’ marketing out Janet Hill,” and then proceeded to rip call Ge# en made to Redstone in the wake chief, Terry Press, appealed to Hill to change into Rob Moore, accompanied by his wife, as of Freston’s ! ring, in which Ge# en report- her boss’s mind. He wouldn’t. Stacey Snider terri! ed onlookers ran for cover. Hill resigned edly suggested that Katzenberg be hired to appealed. That too had no e# ect. Finally, this past June. Ge# en was widely blamed. replace Freston. (Ge# en vehemently denies Ge# en himself telephoned Hill. She said it (Hill could not be reached for comment.) this.) Redstone has said he dismissed an- was Grey’s call. Ge# en phoned Grey, who “All this, all this noise, really started to per-

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colate after they ! nally had a successful ! lm, chief, Ronald Grover, claiming that Spielberg n August, in the wake of these stories, I Dreamgirls,” notes a Paramount partisan. and Geffen remained unhappy and were called the Redstone adviser, who blamed “After Dreamgirls, there started to be a lot of prepared to bolt once Spielberg’s contract I all the bad publicity—including the Finke noise about credit, that Paramount was get- expired, in October 2008. The article’s sourc- item—on Ge# en, who, he said, was launching ting too much credit for the success of Dream- ing was anonymous, but Geffen’s finger- a covert press campaign in an e# ort to bring girls. Then DreamWorks had a string of huge prints were all over it; Ge# en admits, in fact, Redstone to the bargaining table. What Gef- successes. Norbit, $95 million. Blades of Glory, that he was one of Grover’s main sources. fen wanted, he couldn’t say. At ! rst the advis- $120 million. Disturbia, $80 million. And then The piece blindsided Grey’s team. “We gave er’s tone was more winsome than combative. Transformers, the biggest them everything!” says one “We’re not going to win this one,” he said. [live-action] hit in Dream- Paramount executive. “And “There’s nothing we can do. We don’t have THE DREAMERS Works history, $315 mil- David Geffen, Jeffrey then, what?—six weeks later, the leverage Ge# en has in this town. Sumner lion. So it’s all during that Katzenberg, and Steven it was: Well, not really. People doesn’t even want to play the game. Ge# en, I run, where DreamWorks Spielberg at the New are scratching their heads say- mean, he’ll do anything. He’ll say anything. has been doing better and York Stock Exchange, the ing, ‘We don’t understand.’ We keep telling Sumner, ‘Keep your head better, where DreamWorks day after the I.P.O. of down till this blows over,’ has gotten more and more DreamWorks Animation but it probably won’t. If we unhappy. It was in the SKG Inc., October 28, 2004. ! ght back, well, then they’ll spring, I remember, where come after Sumner with ev- everyone [at Paramount] erything they have.” began reaching out to Dream- Articles about Redstone Works, saying, ‘What do you need? in Fortune and elsewhere, We want you to be happy.’ ” (Para- spurred in part by critical mount, meanwhile, had been " oun- remarks Redstone him- dering with Shooter, $47 million, self had made about his and Zodiac, $33 million.) daughter, Shari, continued A series of meetings between through August, and by Ge# en and Grey ensued. Anxious Labor Day Redstone’s to placate Ge# en, Grey gave him men had come to believe practically everything he asked they had no choice but to for. Paramount would stop refer- respond. The next time I ring to DreamWorks movies as its spoke with the Redstone own. Snider’s green-light authority adviser, in early Septem- was increased from $85 million to $100 million—$150 million for a movie Spielberg directed. And DreamWorks was given authority to hire its own corporate “WHAT ARE WE public-relations person. By June, as the SUPPOSED TO DO? BEND OVER SOME talks wrapped up, tensions appeared to be diminishing. MORE?” SAYS A REDSTONE EXECUTIVE.

nd there things lay for a month or It was at that point that we realized, O.K., ber, he all but jumped through the phone in a so. For a time, peace seemed attain- there’s something else going on here. There’s full-throated excoriation of Ge# en. I was in a A able. All through the spring Grey another agenda. And it was over our heads.” taxi, and struggled to scribble down remarks appeared to re-double his e# orts to soothe Grover’s article triggered a series of fol- that " ew as fast as bullets. Of Ge# en, the ad- Ge# en and especially Spielberg, reportedly low-up pieces in Slate and Daily Variety, viser said, “He’s all over town, saying this and visiting the director on the Connecticut set among other places, as more beat reporters that. You know what this is? Seller’s remorse. of his fourth Indiana Jones film, which tried to make sense of the situation. Most I tell you, they’re testing our patience$ I’m Spielberg was ! lming for Paramount. Grey painted Ge# en and Spielberg in sympathetic telling you, we’re about fed up with this stu# . also visited Spielberg at his compound in terms; none were especially kind toward All their movies, Indiana Jones, everything in the Hamptons to hand him a $1 million Redstone. A Los Angeles Times report la- their library and everything in their pipeline, check for the Shoah Foundation, an archive mented Redstone’s “overblown ego and tin you know what? It’s all ours! Tough! They of oral histories about the Holocaust started ear with talent” and termed him “an elderly want to leave? They want to go start over? by Spielberg. He even attempted to co-opt grandfather” similar to bygone studio chiefs Fine. Leave! We have done everything we Terry Press, soliciting and accepting her ad- such as Darryl Zanuck, “hanging onto the can to make them feel special. Everything! vice on how best to live peacefully with the trappings of power long after they’d lost the And nothing is enough!” DreamWorks trio. When Press and others cunning and creative zest that had made urged him not to be photographed alone them titans of the industry.” Then, barely V with the stars of DreamWorks’ Shrek the a week later, came a small item on Nikki y September the escalating tension be- Third at the movie’s premiere—the better to Finke’s Hollywood-gossip blog; it reported tween Ge# en and Redstone was mak- keep the focus on DreamWorks—he agreed, that Redstone’s marriage was on the rocks. B ing things difficult for Katzenberg, posing alongside Stacey Snider. He did the He and his wife, Paula, had engaged in two whose role in all this is sharply di# erent from same at the premiere of Transformers. public arguments, one in front of people at those of his partners, Spielberg and Ge# en. N A

But then, in mid-July, just as Paramount the premiere of the movie Stardust. (“These He remains C.E.O. of DreamWorks Anima- G R

executives began to bask in the glow of a Pax are untrue and malicious rumors,” says a Vi- tion, whose movies are marketed and distrib- O M

Ge# enica, came a bombshell: a pointed ar- acom spokesman. “Sumner continues to say uted by Paramount; unlike Ge# en, who has E T E

ticle by BusinessWeek’s Los Angeles–bureau that Paula is the best merger he ever made.”) few day-to-day management responsibilities P

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at Paramount, Katzenberg depends on get- rial in the event somebody shows up to help betrayed him, is still reluctant to criticize ting along with Brad Grey’s team—a team, them start a studio from scratch.” him publicly, in large part, as a DreamWorks it should be said, that Katzenberg has the For Dauman, whose public remarks are adviser points out, because he was instru- highest compliments for. Katzenberg wanted almost always diplomatic and reserved, it was mental in Grey’s hiring. peace. So on Monday night, September 17, tantamount to telling Spielberg and Ge" en By October, while the public sniping was he sat down with DreamWorks attorney Skip to go to hell. Much of Hollywood—and all of receding, the break between the Ge" en Brittenham and discussed how to obtain it. DreamWorks—erupted. “Completely imma- and Redstone forces appeared permanent. “I think everyone agrees that the purchase terial? Can you believe this?” a DreamWorks Privately, DreamWorks executives say they of DreamWorks was both a great coup and adviser blurted the next morning. “How see little chance of salvaging the relation- a giant ! nancial success,” says Katzenberg. could they call Steven Spielberg insigni! cant? ship. Ge" en has already told people he has “But when you have pro! ted so greatly, it’s They must be out of their minds!” been approached by G.E. about Universal imperative to ! nd other ways to reward peo- “As a ! lmmaker, storyteller, artist and and by other prospective new homes—and ple, especially people like Steven Spielberg conscience, Steven Spielberg is nothing short indeed he has said that he is considering and David Ge" en, who are more interested of a national treasure,” Katze n berg said the buying NBC Universal if G.E. were to sell in how they are treated than in money. Ev- next day. “To suggest that not having Steven it. If a move is made, it would allow Ge" en eryone wants to be appreciated. Spielberg is completely immaterial seems to “reboot” everything and still call it “Separate from money, there are ways ill-advised. I think calmer heads need to DreamWorks. (Rights to the DreamWorks you can reward talent … make them feel prevail here.” name are owned by Katz enberg.) appreciated, valued, respected. That is the Geffen’s adjectives were more colorful, “Oh, I think they’re gone,” says a onetime crux of the issue# DreamWorks has not not to mention unprintable. “These people Hollywood C.E.O. who has worked closely with everyone involved. “I think they get a big o" er and go back to Universal. Maybe they take an equity interest. Ronnie [Meyer] “WHEN IT COMES TO takes some piece of it.” He chuckles, then TALENT RELATIONS, [THE PARAMOUNT mentions Kirk Kerkorian, who has seem- ingly bought and sold a single studio, MGM, PEOPLE] SIMPLY MISSED,” SAYS KATZENBERG. a dozen times over the last 30 years. “They’re going to be like Kirk Kerkorian, where they been given the proper respect, or credit. Tal- are a nightmare,” he told me. “Don’t you un- keep selling the same thing over and over ent relations is the fuel of this industry. Every derstand? To refer to Steven Spielberg as im- again. I always wondered how Kirk did that. day for 25 years, [former MCA/Universal material is not only disrespectful but it does I guess now we’ll ! nd out.” studio chief] Sid Sheinberg made Steven not entitle them in any way to be in business And the Geffen-Redstone feud? Was it Spielberg feel like the most important per- with him. I’ve never seen behavior like this real or some kind of corporate Kabuki? As son in the world to him. In ways large and in my entire life. Steven Spielberg is anything this article was going to press, a sudden tele- small, he made it clear to Steven how much but immaterial to me and all the people at phone call from Ge" en suggested it might all he mattered. The people at Paramount and DreamWorks. We love him!” have been a lot of sound and fury, signifying Viacom haven’t done this. Maybe it’s out of “Clever of David to make it all about Spiel- nothing. intimidation or fear or a lack of understand- berg,” says a person who knows Ge" en well. “I just want to say thank you,” Ge" en ing of what’s at stake, but when it comes said. “Your reporting on this story, somehow to talent relations, they’ve simply missed.” edstone’s men, meanwhile, were elated. you’ve so provoked Redstone he has come On Tuesday morning, September 18, Katz- They felt Dauman had struck just the over to see me and we’ve cleared up a lot of en berg telephoned Ge" en and urged him to R right tone and had succeeded in plac- these issues. This article, you, you did this. A dial things down a notch. Geffen said he would ing Ge" en on the defensive. “What we did lot of this was bullshit. This was about our keep an open mind. Then, barely an hour later, was take the bogeyman out of the closet,” Red- personal relationship. And we’ve cleared up came the news that Redstone had ! nally “en- stone’s adviser told me. “You don’t scare us. a lot of this. And a lot of this I feel like I owe gaged.” Viacom’s C.E.O., Philippe Dau man, You can’t rattle [the prospect of leaving] at us to you. All of this stu" we’ve allegedly said, the man who had replaced Tom Fres ton, was anymore. We understood this would be a big I’ve allegedly said, we don’t have a problem speaking at an investors’ conference in New deal in Hollywood. Because nobody ever says anymore. Our personal problem, we’ve re- York. A Viacom adviser had already told that kind of stu" . Out there, Ge" en and those solved. We’ve cleared the air. And it was all a handful of reporters what to expect. But Dau- guys yell ‘Jump’ and you’re supposed to yell, because of you. Most of it was misinforma- man’s words still rocked Hollywood. ‘How high?’ Well, they got slapped on the tion. And when you’re not talking to each Asked about the possibility of losing wrists a little for trying to turn this into an at- other, you can’t resolve anything. So Sumner Spielberg, Dauman said, “We’re doing ev- tack on Saint Steven. We’re ! ne with that.” called up, he apologized to me for anything erything possible to make him happy# He sighs. “What are we supposed to do? I he said that may have upset me. I apologized Now, Steven and his team have the right to mean, Brad doesn’t know what to do at this for things that may have upset him. And we leave if they choose at the end of next year. point. He doesn’t know what to do to make cleared the air. And we don’t have a problem At that point, if there is someone who steps them happy. Do we have to have lunch with with each other. We may still have problems in with $1 billion, $2 billion, whatever, step- them every day? It’s hard to have lunch with between Paramount and DreamWorks. But ping into the [Microsoft co-founder] Paul David Ge" en when you know what he’s say- not with each other.’’ Allen role a dec ade ago to start a new stu- ing about you all over town.” The Viacom spokesman confirmed the dio from scratch, that is a possibility. And Indeed, DreamWorks partisans can be cease-fire, but declined to comment further. we’re planning for that.” Dauman then withering when discussing Grey, whom they It’s certainly possible Vanity Fair pos- praised Paramount’s upcoming ! lms, be- portray as an imperial overlord in love with sesses miraculous diplomatic clout. But the fore concluding, “So, the ! nancial impact his perks, grabbing seats reserved for actors actual reason for this latest twist can likely to Paramount ! rst and especially to Via- on private jets. Geffen, who has been be found only in the strange and wonderful com overall would be completely immate- heard around town saying that Grey has mind of David Geffen. $

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