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Gross Profit : FATAL SUBTRACTION: The Inside Story of Buchwald v. Paramount, By Pierce O'Donnell and Dennis McDougal, With an introduction by Art Buchwald (Doubleday: $25; 527 pp.)

August 30, 1992|Steven Bach | Bach is the author of "Final Cut: Dreams and Disaster in the Making of Heaven's Gate" and "Marlene Dietrich: Life and Legend," to be published in October by William Morrow

The reader is boggled by glimpses at Eddie Murphy's Paramount perks. The least of these was a trivial but eye-catching $235.33 breakfast bill from MacDonald's, leading the authors to conclude that "the Mad Hatter was the chief financial officer in Hollywood."

Apart from breakfast and the $200,000 per page story fee (possibly a record), there was Murphy's $1.7 million "signing bonus," his $8 million acting fee, plus 15% of the gross, as well as the by-now notorious monies paid to Murphy's entourage. These included Arsenio Hall, who had a role in the movie and received a $30,000 writing fee for a "brief scene." He would have had a story credit, too, had it not been opposed by director Landis, who was busy collecting $6 million on his gross percentage while billing the picture for his wife's failed Academy-Award campaign as the movie's costumer.

The surprising winkle is that Eddie Murphy's production company was subject to the same "net profit" definition ("monkey points," Murphy calls them) as Buchwald and Bernheim. Like them, Murphy's company earned no profits from "Coming to America" because, as a Paramount spokesman admits, "net profits" are an "arbitrary convention," one the authors say "balances the studio's books on the backs of the net profit participants."As one of Paramount's legal mouths puts it: "(P)eople in this industry are not compensated on the profitability of a film to a studio . . . nobody is paid a part of the studio's actual profits," which the studio will go to any lengths to protect by refusing to open the books.

Judge Schneider ruled in favor of Buchwald and Bernheim in the breach-of-contract phase of the trial and awarded them $900,000 for fees they should have been paid under the contract of adhesion he found "unconscionable" to begin with. But three and a half years later, what Buchwald cheerily called "the lawsuit that will not die" isn't dead yet. According to the authors it will "never be over. The studios could not allow it to be over." Most vitally, Buchwald v. Paramount "challenged the status quo."

"The net profit formula as written no longer exists," the Judge pronounced from his bench. Whether appeal courts confirm or overturn this, challenging the studios' version of the status quo is a true and overdue achievement, hugely abetted by Parmount's arrogant refusal to open the books on the rib-tickling grounds of "trade secrets," which must presumably remain secret from the very people creating the product on which the studio trades. Such issues are of obvious import to anyone working (or aspiring to work) in the trade, as well as to movie patrons and stockholders, who can pass up the overpriced popcorn and genuine-simulated-fake butter, but must ultimately pay for $235.33 worth of Egg MacMuffins, whether they want to or not. "The studio was the cost," goes the most perceptive and damning line in the book.

As the Perry Mason voice of case and page, Pierce O'Donnell is every client's night mare of a lawyerly windbag. One member of the Hollywood legal fraternity assures me that O'Donnell's attempts to arrive through third parties at an out-of-court settlement with Paramount are handled in print with far less candor than O'Donnell ringingly demands of Paramount at his every paragraph indentation.

Conspiracy theory about "The Club" (an "emirate" of once and forever studio executives) is wildly over-stated, while the very real roles of agents and guilds in tacitly (or worse) colluding with Hollywood's system of contracts and compensation is glossed over with breathtaking disingenuousness.

To call the movie industry's net profit definition "the financial 'crime of the century' " is a rhetorical grabber, but loses authority from a lawyer whose firm defended Charles Keating and Lincoln Savings and Loan.

For a book so self-celebratory, "Fatal Subtraction" seems sometimes oddly unself-aware. O'Donnell harps on the studios' hits-pay-for-flops accounting philosophy, while defending his own 40% contingency fee (the basis on which he took the case) at least three different times with variations on "the winners subsidize the losers." They do in any business; if it's acceptable for lawyers, why is it so reprehensible for studios?

Still, everyone in Hollywood offered a net profit agreement should be required to produce an affidavit affirming he or she has read and understood "Fatal Subtraction." Such reading will be informative, and a chore. The subtleties of the law and legal argument are not to blame: They're rich and fascinating. It's O'Donnell's (or McDougal's) constant grandstanding and attempts to make the book read like a movie (one part of the book is actually titled "Lights, Camera, Action!") that belong on the cutting room floor along with all the Perry Mason posturing and dialogue.

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