As Art Buchwald's accountants began going over the Paramount books in their legal battle over "Coming to America," they ran into their first snub when they tried to visit the Paramount commissary for lunch and were told they were not allowed. Buchwald phoned them later in the day and said he would have pizza delivered over the coming weeks while they pored over an estimated 95,000 line items charged to the Eddie Murphy comedy.
At the same time, Paramount attorney Charles Diamond went public with an explanation for a $235 breakfast at McDonald's in Queens, allegedly paid out of petty cash to Murphy and his entourage and charged off to the production cost of the movie. The expense item, leaked to the press last month, became a symbol of Murphy's extravagant lifestyle (chauffeur, personal trainer, entourage, etc.) during the filming of a movie for which he was paid an $8-million salary plus a 15% share of gross profits.
"The Big Mac Attack," as it has come to be known, was actually 148 Egg McMuffins for the extras who were in one of the scenes shot out at JFK," and did not involve Murphy at all, said Diamond. In fact, the star's breakfast was only $43.57, also paid from petty cash, and was paid to Host International Bakery, not McDonald's.
Diamond said that Paramount, which offered to settle with Buchwald and co-plaintiff AlainBernheim several months ago, has changed its strategy. Not only does the studio plan to go to trial, there will also be a campaign to dispel the "disinformation" Buchwald attorney Pierce O'Donnell has leaked to the media, Diamond said.
"The people who run the studio view themselves--and rightfully so--as honest, straightforward, straight shooters," Diamond said. "Furthermore, the studio's lifeblood depends upon having solid relationships with the people who write movies and the people who perform in movies and the people who direct movies, and you simply cannot turn the cheek when somebody calls you a thief. So Pierce has made his bed and he's going to have to sleep in it because we're going to trial."
O'Donnell, whose firm has already spent an estimated $1.1 million fighting for Buchwald and Bernheim's share of the film's profits, said he was confident that the audit now being conducted at Paramount would make the exercise profitable for his clients, who are contractually entitled to 19% of the film's net profits.
"That is, provided my people don't starve to death," he said, referring to the Paramount commissary ban.
In 30 pages of formal questions and answers, known in legal jargon as "interrogatories," Paramount informed Buchwald's attorneys late Friday that the studio's calculations showed that the hit movie "is approximately $18 million from achieving 'net profits' as of the most recent accounting period (ending Dec. 31, 1989)."
The studio put its total income from the movie as of that date at $138.3 million, $13 million of which had not been collected. Gross receipts, according to Paramount, was the difference between those two figures: about $125.3 million.
O'Donnell, who has maintained that the studio is hiding true profits by charging off expenses to the movie that should be charged to Paramount's overhead, responded to the interrogatories with a one-liner:
"We'll just make a movie of the trial and call it 'Honey, I Shrunk the Gross,' " he said.
In November, he said, O'Donnell was informed in a confidential letter from Paramount's legal counsel, Bob Draper, that the studio's income from "Coming to America" was actually $151 million.
"The number we gave Pierce was 'grossed up,' as they say in the business," said Diamond, explaining that the additional $26 million represented the amount that the studio expected to receive from home video sales. That figure, however, does not take expenses of home video distribution into account, Diamond added and, at least for the accounting period ending Dec. 31, 1989, is not included in actual gross receipts for the movie.
The biggest expenses that the studio has charged off to the $125.3 million it earned from "Coming to America" are:
A studio distribution fee of $42.3 million.
Distribution expenses, including prints and advertising: $36.2 million.
Negative cost (actual production cost, including salaries and gross profit participations, but excluding interest): $58.5 million.
Interest on production expenses: $6.3 million.
Trial is scheduled to begin July 9 in Los Angeles Superior Court.