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Inglewood's Ailing Forum Blames Owner of Staples

The church-owned venue accuses Anschutz Entertainment of monopolistic conduct.

September 07, 2006|Alana Semuels | Times Staff Writer

Staples Center and the Forum are among Southern California's biggest and best-known arenas, but a lawsuit filed Wednesday suggests this town may not be big enough for the both of them.

Pitting theirs as a "David vs. Goliath" battle, executives at Forum Enterprises Inc., a unit of a church group that owns the 39-year-old Inglewood arena, disclosed that it was ailing financially and placed the blame on Anschutz Entertainment Group Inc. for allegedly steering concerts to its own venues, including Staples.

The lawsuit charges that Anschutz -- until this week the exclusive booking agent for the Forum -- had engaged in a conspiracy with Anschutz affiliates to "unlawfully monopolize" the Los Angeles entertainment market.

Concerts can be highly lucrative for arenas because of the fees and concession sales they generate. The Forum group is seeking to recover more than $5 million it alleged has been lost because of Anschutz's booking strategy.

"AEG does not want us to increase booking activity for the Forum because it becomes a competitor for Staples arena," Forum lawyer Gregory G. Gorman said.

Anschutz, owned by Denver billionaire Philip Anschutz, issued a statement late Wednesday calling the claims meritless" and accusing the Forum group of trying to circumvent Anschutz Entertainment's exclusive booking rights. The company vowed to pursue claims against the Forum for allegedly failing to live up to the agreement.

Nicknamed "The Fabulous Forum" in its heyday, the arena played host to such iconic artists as Jimi Hendrix, the Rolling Stones and Elvis Presley. It was also home to the NBA-champion Lakers and hosted the men's basketball competition during the 1984 Olympics.

Many predicted its demise when the $375-million Staples opened in Downtown Los Angeles in 1999. But operating through the newly formed Forum Enterprises, the 13,000-member Faithful Central Bible Church bought the Forum in 2000 for $22.5 million. The African American church holds weekly services there.

The new owners agreed at the time of the purchase to use Anschutz as an exclusive booking agent, with the company obligated to book $500,000 in events at the Forum each fiscal year.

The Forum alleged that Anschutz had not held up its end of the bargain, adding that Anschutz said in writing that it never intended to fulfill its fiduciary obligations as a booking agent.

The Forum group said the arena had hosted 12 non-church events in the current fiscal year, including big-name concerts featuring Madonna, Pearl Jam and Coldplay. But the company said its own representatives arranged 10 of those events.

Gorman said the church was struggling to pay its mortgage and cover operating costs.

"As the Forum fails, we are unable to do the things that we need to do in the ministry" such as community outreach programs, said Marc T. Little, chief operating officer and general counsel of the Forum group.

Little said that when the church bought the Forum, it hoped to use the building as a tool to have a positive impact on working-class Inglewood by providing family-oriented entertainment for the community.

But some observers wonder whether it is reasonable for the Forum to expect to attract as many shows as its newer rival.

Staples has state-of-the-art dressing rooms compared with the Forum's old Laker locker rooms , a bigger backstage infrastructure than the Forum and private boxes, said Gary Bongiovanni, editor in chief of concert trade magazine Pollstar. The church had previously said that the Forum was destined for demolition in 1999 before the purchase.

"Most artists are going to want to play the big, new building," Bongiovanni said, although a few artists, like Bruce Springsteen, have said they prefer the ambience of a relatively smaller venue like the Forum.

As for the claim that Anschutz is diverting events from the Forum to Staples, Bongiovanni said it's just the concert business.

"When you build a new arena, you want to make sure that you're not competing with the old arena in town," he said.

Old arenas frequently are torn down or for contractual reasons don't compete with newer ones. In Houston, for example, when an old arena was sold to a church, it held its own events but did not host other acts.

As big as Los Angeles is, whether the town can accommodate two big arenas remains to be seen. "It's certainly nice to have," Bongiovanni said. "But whether you can economically make those two buildings operate is another matter."


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