Juiciest CAA Book Reveals: Ron Meyer’s Gambling Debts, Mike Ovitz’s ‘Incredibly Stupid’ Deal and More

Powerhouse CAA Book
Courtesy of Custom House

The already slow pace of another Hollywood summer could grind into even lower gear today, as industry types let the phone ring while they whip through the biggest tell-all book in recent memory. “Powerhouse: The Inside Story of CAA,” released Tuesday, details the birth of the super-agency, its internal struggles and, in particular, extreme behavior by two of its founders, Michael Ovitz and Ron Meyer.

Among the revelations of the oral history, compiled by author James Andrew Miller: How Meyer, now vice chairman at NBCUniversal, faced the threat of mob retaliation when he racked up huge gambling debts and how Ovitz purportedly left millions on the table when he departed CAA in 1995 and didn’t insist on a share of the agency’s future profits. Among the book’s dishier moments:

Ron Meyer’s Gambling Debts: “Powerhouse” paints a portrait of Meyer in contrast with the avuncular figure who now is a mature, calming presence at Universal. Growing up in West L.A., Meyer was a street tough who regularly beat up rivals, then went on to become a Marine. Miller’s book confirms long-swirling rumors that the CAA founder ran up large gambling debts. The book suggests that, sometime in the 1980s and 1990s, Meyer was “once in the hole for several million dollars.”

“Powerhouse” says the debt was to mobsters, though it doesn’t specify which ones. “This wasn’t some casino on the strip,” the book says. “The ‘guys’ Meyer was on the hook to only swam in the deep end of the pool.” His troubles were so severe that Meyer went to Ovitz for an advance on his agency earnings, a request that Ovitz denied, though the CAA boss was “fearful for Meyer’s safety.”

Miller’s tell-all conjures a late night meeting between Meyer and his creditors, with the super-agent admitting he could not pay his debt but was spared. “He left that meeting alive, both legs operative, genitalia intact,” Miller writes. It was Ray Stark — the producer of hit films including “The Way We Were” and “The Goodbye Girl” — who loaned Meyer the money that kept the super-agent “in one piece,” the book says.

Unlike the bulk of the book, the description of Meyer’s gambling predicament comes from the author and includes no observations from Meyer, Ovitz or any of the other principals.

Michael Ovitz’s Scheming and Fury: There are plenty of examples of Ovitz’s manipulations and explosive temper, including one episode in which he promised to put CAA client Sean Connery into a film to please Arne Glimcher. Glimcher was the art dealer who helped Ovitz aquire a world-class collection and so Ovitz reciprocated by promising that Connery would star in a film, “Just Cause,” that Glimcher planned to direct. The only problem: No one got Connery’s approval.

Former CAA partner David “Doc” O’Connor describes how Connery felt the script for the film was crap and wanted out. The star told Ovitz during a conference call that O’Connor, then a junior agent, agreed with the judgment that he should not make the film, though O’Connor had given no indication where he stood. That put O’Connor in the uncomfortable position of coming between Ovitz and one of his pet projects.

O’Connor was called into the office of a seething Ovitz. “He comes around his desk and he gets right up into my face and he’s bright red,” recalls O’Connor, now CEO at Madison Square Garden Co. “His veins are popping out of his neck and his forehead and he starts screaming at me, ‘You don’t know what the fuck you’re doing! You’re a fucking amateur! I don’t know why I fucking pay you and you’re done with Sean Connery!….Get the fuck out of my office.’ “

O’Connor thought he would be fired but the episode had a “happy” ending. Connery was appeased, and made the movie, when CAA fattened his paycheck by agreeing to give up its commission.

Ovitz Leaves Millions on the Table: For all his ferocious deal making and competitive zeal, several insiders suggested that Ovitz got a relative pittance when he negotiated his 1995 exit from CAA. He got one-third of a $175 million payout (sharing the buyout with two other CAA founders)  but no percentage of future proceeds for properties that the agency had helped create — like the “Jurassic Park” film series. Ovitz arranged the sale as he headed off to become president at Disney and as Meyer was moving on to Universal.

The agency’s founders made the deal with five CAA agents who had become known collectively as “the young Turks.” Mogul David Geffen is among those who described it as “a very bad deal,” adding: “Mike did this. When he sold the agency to them for less than the accounts receivable, it was an incredibly stupid deal, incredibly stupid. But what can I say? If Mike Ovitz was smarter, they each could have kept 10 percent of the agency under the agency rules, the guild rules. The guys that were left would have been thrilled to death to get 70% of that agency.”

Meyer, who left it to Ovitz to negotiate the departure, explained: “There was no time to work out a complicated exit arrangement.” Ovitz offered: “There’s nothing I could have done differently without disrupting the place. Could I have asked for a royalty? That’s probably the only mistake that I made. I should have said, ‘In success, I want a royalty.’ But it didn’t matter to me; I did just fine.”

High-profile Former Insider Hits Richard Lovett as “A Bad Guy”: The high-stakes agency world is epitomized by its many feuds, including a spat that led to the firing of powerful agent Dan Aloni in 2012.  Aloni describes how he says CAA President Richard Lovett tried to force him into a management role in the agency’s motion picture department, then ignored his suggestions about how to improve employee morale. Aloni called his departure and move to rival WME “one of my proudest achievements” because he said he “started a wave of change from CAA’s dominance by being the first person to leave and take major business away.” Director Chris Nolan, the creative force behind the Batman “Dark Night” films, followed Aloni to WME.

Summing up the complaints of agents leaving CAA, Aloni said: “Richard is just a bad guy and that’s really the bottom line…  I think what is happening at CAA is similar to what happened at the old, old William Morris Agency. It is not fun when you see a lot of people who are treated poorly and management doesn’t care. They really don’t care.”

Lovett retorts that one of his greatest accomplishment is to help create a collaborative culture at CAA. “The culture of the company has a way of ejecting those who don’t fit,” Lovett said. “I had many conversations with Dan, but he was never able to change his behavior.”

Sherry Lansing Receives A Load of Umbrellas…and Salt: After breaking away from the William Morris Agency in 1975 to form CAA, the new partners hustled around the clock to build their clientele and connections. Future Paramount Pictures boss Sherry Lansing was then an executive at MGM, reading scripts and seeking out new material. In 1975 she received a phone call from CAA co-founder Bill Haber, who wanted her to run through the studio’s release schedule with him. Her inclination was to make him go through standard channels, which led Haber to launch a charm offensive.

He promised to shower Lansing with gifts. The next day, 50 shower caps arrived in Lansing’s office, followed a day later by 50 boxes of Morton salt (with the picture of a girl under an umbrella) and, the next day, a batch of umbrellas. Lansing was charmed and told Haber she was “throwing in the towel.” To make her point, she sent CAA an actor-messenger wearing a towel — though the covering fell off and revealed the messenger was naked underneath.

Haber completed the unctuous onslaught with an invitation for Lansing and a fellow exec to come to dinner. CAA had the MGM duo chauffeured to LAX, where they boarded a plane that flew them to an unknown destination. It turned out to be Van Nuys Airport, where a feast had been set up in their honor. “We had a beautiful dinner in the hangar,” Lansing recalled. “Needless to say, it was the beginning of a wonderful friendship.”