Split between Eisner and Katzenberg ended an era, and began a rivalry

Imagine a vet screenwriter going in to pitch a domestic drama idea he cooked up. It tells of a complex relationship between a father figure and his putative son, involving manipulation, greed, betrayal, one-upmanship, and deep and undying enmity. Sounds like a potential hit with two star roles, right? Any studio exec worth his weight in Armani would bite.

Unless they happen to be working at the Disney Co. or DreamWorks, where this melodrama might instead provoke the gag reflex. Especially if the star casting consists of Michael Eisner and Jeffrey Katzenberg in their own version of “Le Divorce” that continues to reverberate throughout Hollywood.

The third piece of casting was, unfortunately, a ghost and it was his absence that set the whole sordid tale in motion. If Frank Wells had not died on his way back from doing what he did and loved best, adventuring, Walt Disney Studios chief Katzenberg and Disney chairman Eisner might still be tooling along the Autopia road to higher stock prices, even greater riches and more contract renewals.

Instead, Wells’ death in a crash on a return trip from a heli-skiing expedition April 4, 1994, stunned the industry and particularly the Disney Co. (Clint Eastwood had returned safely from the same trip a day earlier.)

Eisner had the big vision and fashioned a modern-day Uncle Walt persona; Katzenberg was the perennial retriever, reinventing the Disney animated franchise and scoring often and big with domestic comedies. But it was Wells who ran Disney’s sprawling empire day after day, from the theme parks and the merchandising to the film and TV studios. Most important, it was Wells who kept the peace between the more emotionally volatile tandem of Eisner and Katzenberg.

“He continually lectured me to be more gentlemanly and more collegial,” remembers Bill Mechanic, who was head of international theatrical and worldwide video for Disney under Wells. “He thought it was as much a measure of how someone should be judged as their actual accomplishments.”

The loss was particularly stinging to Eisner, who sat literally 15 feet apart from Wells every workday since Eisner had lured him to Disney 10 years earlier. It left a huge personal and professional void that he was in no rush to fill. Plus, Disney was on top of the entertainment business world. Its revenues had jumped to $8.5 billion from $1.5 billion 10 years earlier, and its stock value soared an unearthly 1,500% under the Eisner-Wells-Katzenberg triumvirate.

When Eisner called Wells “his most treasured colleague,” he wasn’t kidding. That became increasingly apparent to Katzenberg, who waited impatiently in the wings. Despite his lobbying, his entreaties in the press and through numerous friends and colleagues, and finally an outright demand for Wells’ position as Disney’s No. 2, he was turned down flat by Eisner and the Disney board. Katzenberg finally threw in the towel.

Rather, he threw it at Disney in the form of a $581 million lawsuit brought by that teddy bear of lawyers, Bertram Fields. Katzenberg alleged that he was denied the share of Disney’s huge profits promised in his contract; it was a business dispute, not personal.

“It should not be misconstrued as any kind of personal and putative action,” Katzenberg said at the time. And if you believed that, then you also believed that Katzenberg was going to Sony, Universal or even the most unlikely possibility of all, that he would mortgage everything he owned to join Steven Spielberg and David Geffen in forming DreamWorks.

Starting in 1994, Hollywood’s appetite was whetted. Studio dirty linen was rarely aired as publicly and as damningly as it was over the next five years, as depositions, pretrial motions and discovery yielded a treasure-trove of delicious stains on the participants’ reputations and legacies.

The circus didn’t pull out of town until July 8, 1999, when Disney announced that it was settling Katzenberg’s lawsuit for an undisclosed amount that was widely accepted to be around $275 million, including $117.5 million Katzenberg received in a partial settlement in 1997.

Geffen, who was just anxious to see the whole mess go away, brokered the deal. “My idea of a good settlement is when both sides are unhappy about it,” he said at the time. It must have been a very good settlement, because both Eisner and Katzenberg still seethe about it today.

Disney, thanks to the Pixar deal that Katzenberg first made, still rules the roost in animation. Katzenberg has had great success at DreamWorks in packaging smart, critically praised commercial films, but he is one among three.

And over it all hovers the ghost of Wells, who must heave a heavenly shudder when he contemplates all his good work gone to waste, along with the lack of any gentlemanly or collegial behavior. “

If Frank Wells were alive, this never would have happened,” Fields said in 1996, a sentiment that is one of the few things Katzenberg and Eisner might agree upon.

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