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Disney's Tough Tactics : Entertainment: Critics view the company as the fiercest of Hollywood's bare-knuckle fighters. Disney maintains it is held to a higher standard than others.


NEW YORK — It has been 79 years since a gentle Scot named John M. Barrie wrote "Peter Pan," and 3 1/2 years since the expiration of copyrights on the children's tale of fairy dust and far away.

But Walt Disney Co. has considered the story its own since it created the first cartoon version, and Disney was not amused last year when it learned that CBS was planning a Peter Pan cartoon show. Disney Studios Chairman Jeffrey Katzenberg lost no time calling Kim LeMasters, then CBS' programming chief, and Howard Stringer, the network's broadcast-division boss, to tell them that Disney didn't want anyone doing such a show.

Katzenberg says he simply asked CBS to give up the series "if it isn't of the essence to you." Other knowledgeable sources say Katzenberg threatened "all-out corporate war."

Whatever was said, CBS quickly abandoned the show, agreed to pay the producers a compensating fee and gave them substitute production work, sources say. Mickey Mouse had bared his teeth and gotten his way.

In recent years, Walt Disney Co. has made a name as the world's most successful entertainment company, a hugely profitable and innovative corporate juggernaut. But to some, the master marketer of children's fantasies is also the toughest of Hollywood's bare-knuckle fighters, a company that uses its vast resources and unique franchise to continually press its advantage.

The critics see a pattern of bruising tactics in Disney's many battles. Disney has shown itself willing to take on other rival entertainment firms again and again, in court and in the market. They say the company has demonstrated that it is ever ready to sue those it believes have infringed its copyrights, even in cases in which outsiders find it difficult to understand why Disney can't find compromises.

In its efforts to hold down filmmaking costs, Disney has faced off against Hollywood agents and lawyers with a toughness that sets it apart from other studios, the critics say. And in central Florida, where Disney's economic power has made it a great benefactor, the company has also shown that it is willing to stymie the plans of government and its neighbors--from mass transit systems to low-income housing--if those plans interfere with its ambitions.

Disney executives deny that they're too tough and say some complaints arise because the world doesn't measure them as it would other businesses.

"We are held to a higher standard in every area," Katzenberg says in a prepared statement. "When we misstep--when we make an error--it can be blown out of proportion, since it is not acceptable for Disney to ever make a mistake. I think everyone expects us to be letter-perfect. And you know what? That's what we would like to be."

Perhaps most prominent among the company's critics are the heads of some rival entertainment companies, who have run afoul of Disney repeatedly in recent years and assert that the company has gone too far.

Barry Diller, chairman of Fox Inc., for example, says he believes that Disney's tactics are an "odd, self-destructive thing . . . that isn't needed from a company that's succeeded as brilliantly as this one has." Sidney J. Sheinberg, president of Universal Studios parent MCA Inc., says Disney "isn't just aggressive. They have crossed the line."

Disney's defenders--and they are numerous, too--say the company is no tougher than others in an industry that has been known for an eye-gouging, kidney-punching sort of competition since the days of L. B. Mayer and Harry Cohn. They say Disney is taking the heat because it has tried to roll back Hollywood pay, because it has outperformed rival show-business conglomerates and because the public expects not just fairness, but saintliness, from the creator of Mickey and Minnie.

"They're tough, but I've found them to be honorable," says Larry Cochran, chief executive of Six Flags Corp., the theme park concern that is 20% owned by the Time Warner media conglomerate.

'Special Complexities'

Disney executives don't try to present themselves as angels, but talk about the special complexities of their dealings with other businesses.

From where they sit, a company as successful as Disney must not only work hard to keep growing but must also constantly defend itself from the many who want a share of the wealth it is creating. In their view, this includes animators who produce new versions of Disney's classic animated movies, copyright pirates who want to make money from unlicensed Mickey Mouse souvenirs and personal-injury lawyers who hope to win big jury awards for large and small theme park accidents.

It includes, too, the rival entertainment firms that have crowded around Disney World and Disneyland to take a share of the tourist bonanza and the talent agents and lawyers who, in driving hard bargains, have driven Hollywood compensation ever higher. In Disney's view, some of the grumbling about the company's tactics comes from the agents who become angry when Disney walks away from film projects rather than pay high prices.

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