Is This Legal Read online

  As for his style, Smith said that he was a black belt in tae kwon do, and had also trained in robotae, which was taught to him as a kid by a school janitor. I’d never heard of robotae in my life, but like his 250-fight winning streak, it would do for now.

  I told Smith that the winner’s check would be for $50,000, and that was good enough for him. Just like that I’d successfully recruited my first fighter.

  As soon as I drove back to Los Angeles from Denver, I hired Donald Delano Moss (a Loyola law school grad) in Burbank as our entertainment lawyer. Fields was our guy in Denver, but that was for W.O.W. Promotions, LLC things, like setting up our bank accounts and drawing up a fighter contract for Pat Smith. Business lawyer things. Moss was the guy who was going to have to go head-to-head on the forthcoming SEG contract, with their lead counsel, who just happened to be Meyrowitz’s brother, David.

  We got Moss just in time, as Campbell was right back on the phone requesting another meeting at SEG in New York, now with Rorion accompanying me. Meyrowitz wanted to meet my partner, and he wanted to talk about finalizing our deal for War of the Worlds. Campbell said that they’d pick up the tab again, and that we were all moving in the right direction.

  At this point, I got the feeling that Campbell needed War of the Worlds more than War of the Worlds needed Campbell. While it didn’t look promising, I hadn’t yet heard back from ESPN and Prime Ticket which meant I might still have a shot with them. I’d come this far, picking up Rorion and Milius along the way. If it wasn’t SEG, I’d find someone else. I wasn’t sure who or when, but I did know that War of the Worlds would not live or die based on the whims of Campbell McLaren and Bob Meyrowitz.

  I hadn’t just done my homework on Meyrowitz; I’d done it on Campbell as well. He had a producer’s mentality and seemed to have an understanding of what an audience would want. So, when I first ran my concept for War of the Worlds by him on the phone, he shot a lot of smart questions at me. I’d discovered in talking to him that in his search for new shit, he’d looked into midget pro wrestling, monster trucks, Mexican luche libre and other marginalia. Campbell’s job as Vice President of Original Programming for SEG was based on his getting shows on the air, which would generate a lot of PPV buys, and thus a big profit for Meyrowitz.

  The concerts they had been doing had huge talent fees, plus the legal costs for clearing the usage of the music. The top comedians didn’t have the music clearance issue, but they still commanded big paychecks. Stars sold PPVs, but they also cost a hell of a lot of money. I suspected that SEG wasn’t making a big profit on these. And anyway, you could only go to the well with New Kids on the Block so many times.

  Campbell had graduated from Berkeley, did a stint at MIT, and had studied with Richard Leacock, the famed film documentarian. He had gone on to be a key player in the development of the Catch A Rising Star comedy nightclubs. This made sense, because from my first cold call, Campbell had struck me as a frustrated comedian. Whether or not he lacked the moxie to get up on stage, or decided early on that his future was in the business side of entertainment, I didn’t know for sure. But, he was a funny, wisecracking guy and an out-of-the-box thinker.

  At this point, W.O.W. Promotions hadn’t really cost Rorion and me anything. We had my car trip to Denver, the fee of setting up the LLC, and the small amount that we’d paid to our lawyers Moss and Fields, and to the Denver accountants. But that was really it. I was still working out of the office down the hall from my apartment, and Rorion was still based at the Gracie Academy. He was there until 10 p.m. most nights, teaching classes and running the Academy business. Then he had his traveling Gracie Jiu-Jitsu seminars, and the cash that continued to roll in from the Brajitsu, Inc. videotapes.

  Neither he nor I were collecting a salary from W.O.W. Promotions, which would have been ridiculous, since we would have been paying ourselves out of our own pockets. Absolutely no outside money had come in. My income came from the sales of the Basics of Gracie Jiu-Jitsu tape series, with my 22.5-percent commission deal with Rorion proving to be more lucrative than ever.

  So while I wanted to do a deal with SEG, and get War of the Worlds launched, I wasn’t about to roll over for them, and certainly not for Meyrowitz. But it was exciting to be going back to New York again.

  When we reconvened in Meyrowitz’s office, this time with Rorion in tow, it became instantly clear to me where this was headed—they were going to offer us a sweetheart deal, with them being the sweethearts. Of this I was certain. Meyrowitz came out of the music business, which is notorious for ripping off talent. And in this set up, Rorion and I were the talent. I wasn’t about to start negotiating on our behalf, that’s why I’d hired Moss. But I kept thinking that our lawyer back in sunny Burbank, California, was going to get eaten alive by Meyrowitz and his lawyer brother David, who impressed me right away as being very good at his profession.

  Aside from talking in general terms about their offer, Meyrowitz kept telling Rorion that he knew fighting. He kept going on about this, almost obsessively.

  “Now, I don’t know anything about your jiu-jitsu or the martial arts, but I know fighting. When I was a kid, people thought that I’d become the first Jewish world heavyweight boxing champion.”

  At one point, Rorion shot me a look, and I thought that I was going to piss my pants.

  We ended the meeting without agreeing to anything, other than that they’d be sending us a formal offer. As we parted, I realized that I could relate to Meyrowitz. In a weird way, I sort of liked him, although I certainly didn’t trust him. We were both native New Yorkers—actually growing up fairly close to each other in Brooklyn.

  But Meyrowitz couldn’t relate to Rorion at all, and vice versa. It wasn’t that they were from different countries; it was like they were from different planets. Rorion made it clear that he thought Meyrowitz was an egomaniacal idiot with all of his “I know fighting” talk. And I got the strong feeling that Meyrowitz viewed Rorion as nothing more than a dumb fighter. This wasn’t true, of course. Rorion wasn’t dumb by any measurement. He was actually very smart.

  The David Meyrowitz drafted and Bob Meyrowitz issued SEG contract to “W.O.W. Productions” (we were of course W.O.W. Promotions, and I tried not to take offense) dated June 3, 1993, offered a five-year deal. Clearly, both Campbell and Meyrowitz shared my unwavering belief that War of the Worlds would be a continuing series of fighting tournaments—a franchise, rather than a one-night stand.

  The contract stated that SEG would be “producing and acquiring all rights and title in and to a video production of a live martial arts competition tentatively entitled War of the Worlds: The World Hand-to-Hand Championship. This would take place, on or about October 30, 1993, in Denver, Colorado”

  SEG never seemed to warm to my Rio de Janeiro idea, and at my two meetings in Meyrowitz’s office, I never pushed the issue. The costs were going to be exponentially higher than doing a live PPV broadcast from the continental 48, and there were all of the hassles and headaches that Lulu told us that we’d face. So much for my dream of meeting an exotic, round-assed, Brazilian beauty.

  I had enlightened Campbell and Meyrowitz on W.O.W. being registered as an LLC in Colorado, and on the state government’s lack of oversight and regulation when it came to prize fighting. I’d also told them that if we did Colorado, the only city to consider was Denver, since any place else in the state would make our event feel small and minor league.

  I had long felt that there was a nice symmetry to holding the first War of the Worlds on Halloween night. There was something of a freak-show element to what we were going to be doing, with fighters of all shapes and sizes doing battle. And I thought it would be a cool homage to the infamous radio adaptation of the H.G. Wells novel, in which a young Orson Wells scared the bejesus out of a gullible American public, by making them think that Martians had landed in New Jersey, and were taking over the world. War of the Worlds was the Mercury Theatre’s 1938 Halloween episode.

  But Campbell had explained to
me that the big nights in the PPV-TV business were Fridays and Saturdays. Halloween 1993 was going to fall on a Sunday, so the tentative date was dropped back to the day before, October 30.

  There were parts of their contract offer that I really liked. First and foremost was SEG’s five-year option, which would escalate our guaranteed advance from $50,000 per event in 1993, to $150,000 per event by 1997. I was also pleased to see that they had written in an option to do two more events in 1993, three events in 1994, and then up to four events in 1995, 1996 and 1997.

  But there were also some serious red flags. For starters, Section 2 of the contract stated that, “W.O.W. shall provide and pay for all production costs required by the live event and these live event costs shall in no event be the responsibility of SEG.”

  So in other words, we’d have to pay the fighters purse, arena rental, travel, hotel, meals, logistics and security—basically for everything apart from the PPV broadcast. From the beginning, I told Rorion that we’d need to raise $250,000 to get this thing off the ground. But now with SEG wanting in as our partner, I felt that they should absorb at least some of these costs. Namely the $110,000 total prize money that I’d proposed.

  I also was troubled by Section 4: “SEG shall have the exclusive right to sell, distribute, perform, exploit, advertise and market the production throughout the world in any and all media whatsoever, in perpetuity, subject only to payment to W.O.W. of such royalties and other compensation as set for below.”

  Reading this, I suddenly wished that we had David Meyrowitz on our side, and SEG had Don Moss. And I realized that despite my long career in advertising, marketing and promotions, this stuff was over my head. And I was the guy who Rorion was counting on to get us a great deal.

  He’d told me, “Whatever you decide, Arturo. You know how to negotiate. After all, look at the deal you squeezed out of me on the tapes.”

  The “royalties and other compensation set forth below” was our guarantee of $50,000 on the first event, and $50,000 if we did one or two more the rest of the year. Then the escalators went up to the $150,000 guarantee in year five of the deal in 1997. This I could understand.

  What really concerned me though was Part B of Section 5, which said that we’d get $25,000 if “the production’s initial Pay-Per-View broadcast attains a buy rate of at least 0.5 percent based on preliminary buy rate reports. And SEG would pay us $75,000 if “the production’s initial Pay-Per-View broadcast attains a buy rate of at least 1.0 percent based on preliminary buy rate reports.”

  I didn’t have any idea where the “preliminary buy rate reports” would come from. Would they be from an independent source or would they be from SEG’s internal numbers? I didn’t want Rorion and me to turn into those musicians who are in a never-ending financial and legal argument about how many records were actually sold.

  But the kicker was how SEG was proposing to pay us in Section 6, Clause C of the contract which read in full: “50 percent of all revenues after SEG fully recoups all costs associated with the video production (including, but not limited to, all third party costs for production, marketing, advertising and talent) and receives a 12-percent return on investment.”

  So we’d get 50 percent of what, exactly? I had no doubt that this was where they would kill us with their accounting. I’d already sized up their CFO, Stephen Loeb. He was in that job for a reason.

  I had long heard the legendary show biz story of how the actor James Garner sued Universal Studios over the hit television series that they owned, and he starred in, The Rockford Files. In 1983, three years after the show went off the air, Garner filed a lawsuit against Universal for $16.5 million, claiming fraud and deceit. Basically, that Universal had cooked the books in order to cheat Garner out of his back-end money. It took until 1987 for the suit to settle, which was for a sum that Garner was legally prohibited from revealing.

  Our W.O.W. Promotions backend money was the 50 percent spelled out in Section 6, Clause C of SEG’s contract offer, and I knew that if a star like James Garner could get royally fucked, what chance did Rorion and I have?

  I decided that my play was to not sign the contract, and be amicable in not doing so. I’d keep this moving along with SEG—their proposed October 30 date was less than five months away—by continually telling Campbell and Meyrowitz that our attorney Don Moss was working through everything. They were acting like the contract was signed, sealed and delivered, and were already putting their plans in place for the live PPV broadcast of War of the Worlds.

  At this point, I realized that it was time for W.O.W. Promotions to hire its first employee, and I knew who I wanted to get. If we were ever going to be a real company, it had to be more than just Rorion and me. We did have our creative director, but since he had agreed to lend us his name and support, we hadn’t yet sat down with Milius to talk about War of the Worlds. And I always knew he would be just a consultant, at best.

  So I approached Kathy Kidd, who’d pitched Rorion and me back in February, trying to sell us a booth at the United States Martial Arts Association trade show in Pasadena, which was scheduled to take place in a few weeks time. Kathy was very professional, polite, and I had already made note of the fact that she was also a very attractive blonde. The quintessential girl-next-door, with a voice that could melt butter.

  Kathy told us that martial artists such as Jeff Speakman, Frank Dux and Frank Trejo would be in attendance, and that 60 booths had already been purchased by companies like Century Martial Arts, Otomix and Kwan. And they were going to be holding a preview screening of Dragon: The Bruce Lee Story, which wasn’t scheduled to hit theaters until May.

  Kathy thanked us for our time, and we told her that we’d think about it, and be in touch. But as much as I liked Kathy, I explained to Rorion that the booth price of $750 was just too much. We would be better served in spending that amount of money on a new direct mail campaign, rather than a trade show booth. The Brajitsu, Inc. tapes were flying out the door as it was, and while the event sounded fun, it would be tough to recoup our investment. We’d of course had great success at the Long Beach International Karate Championship the summer before, but the Brajitsu, Inc. mail order business had really grown since then. And a booth at Long Beach cost a lot less than what Kathy was asking for Pasadena.

  This is Kathy Kidd, our first employee. Kathy had been a marketing/event promotion powerhouse when I persuaded her to join our merry band in the summer of 1993.

  Rorion agreed, then said, “I saw the way she was looking at you. And the way you were looking at her. She’s your type. I bet you two get together. What do you think?”

  I ducked the question. When I called Kathy later that day to let her know that we decided to pass on a booth, she graciously invited me to the trade show as her guest. When I attended the following month, I discovered that Kathy was not only a salesperson, she was also the event coordinator. She told me that she worked as an independent marketing and promotions coordinator, and that the United States Martial Arts Association was just one of her clients. What impressed me most about Kathy was that she was working the event while suffering from the flu. I hung out there for half the day, and she never once complained or slowed down. Kathy just kept busting her ass, and with a constant and genuine smile.

  What I saw in Pasadena was a confident woman, who was also an extremely hard worker with the talent for bringing together lots of different people on a project, and solving problems as they arose. This convinced me that I needed Kathy Kidd to work for W.O.W. Promotions. She understood sales, marketing, promotions, event coordination and travel. For our first employee, above all else, I needed a smart organizer who knew the martial arts world, and she had that covered.

  Having not seen nor even spoken with Kathy since the Pasadena martial arts trade show three months earlier, I gave her a call. After very brief small talk, I asked her out to dinner, not making clear if this would be business or pleasure. I met Kathy at a great little Italian restaurant in Torrance, the Via Firenze, whi
ch had excellent pasta, veal and a sophisticated wine list. I discovered that Kathy was very knowledgeable about wines and let her order a bottle. As the evening wore on, I told her all about my dream for War of the Worlds, and how it was now about to become a reality. She sat there listening attentively, with real or pretend stars in her eyes. I was blown away by her enthusiasm and personality.

  The electricity between us was palpable, but I tried to keep it all business. I had an agenda and that was to recruit her to the team. There was no one else I was considering for the job. When I walked Kathy out to her car after dinner, it felt like there was a mutual attraction—a vibe. But since it seemed like we would now be working together, I pushed the thought out of my mind.

  There was no denying though that something was going on. I vowed to make sure that this wouldn’t interfere with the project. Kathy, without saying it, seemed to agree, and took the role of event coordinator that I offered her, which was really the role of chief operations officer. It was arranged that I’d pay her out of my own pocket until we brought in some investment capital. And just like that, we were on our way.

  I was now Kathy’s boss, and there was an unbelievable amount of work ahead for both of us. It was early June, and SEG’s proposed date of October 30, 1993 for the first War of the Worlds was just over four-and-a-half months away.

  I knew that even if Don Moss was able to get us a much better deal than the one that SEG was proposing, we’d still need a lot of cash. Maybe, just maybe, Meyrowitz would agree to pay for some or the entire $110,000 fighter purse, but no way was he going to pay for the rest of our costs, including Kathy’s salary.

  I told Rorion that it was now time for us to make a presentation to potential investors, and that he should lean heavily on his students. They all worshipped Rorion and the Gracie Family, and they would make for a friendly room. I worked my Rolodex, inviting anyone and everyone that I could think of too.