That morning in Fremont Place it took about an hour and a half to dispense with the two dozen or so pieces of mail that had just arrived. All but one were fairly routine. It was a windowed envelope from the Internal Revenue Service containing an IRS Form 1099, Statement of Miscellaneous Income, 1976. The form indicated that Cliff
Robertson had been paid $10,000
the previous year by Columbia Pictures.
"Doe
s this ring any bells with you?" Cliff asked Evelyn. She examined the document. "No."
"Columbia Pictures. Ten thousand dollars." Cliff mused. "That's funny. I didn't do any work for them last year, and I certainly didn't get any money from them. At least I don't remember any. It's an odd figure, too. ten thousand. That's not what I get for a picture. Maybe it was supposed to be a residual payment of some kind, but whatever it was I'm quite sure I didn't receive it. Why don't you check with Michael or Bud and see if they know anything about it."
By noon. Evelyn was back in Van Nuys and Cliff was at Paramount where, since late December, he had been filming a television movie to be entitled
Washington: Behind Closed Doors,
based on the John Ehrlichman novel about the Watergate White House and the CIA. Cliff played the director of Central Intelligence.
TWO
The i
nquiry into the matter of the $
10.000 seemed no more urgent than the many other tasks that Evelyn Christel was performing for Cliff Robertson, and it was not assigned a unique priority. The following week, she
telephoned Abraham "Bud" Kahane
r. the senior partner of Prager & Fenton,
Robertson's accountants. Kahaner had no record of the $
10,000 payment from Columbia Pictures. Neither did Michael Black, Cliff
’
s agent at the Los Angeles office of International Creative Management. Evelyn then phoned the Columbia accounting department in Burbank. After being passed among several clerks, she finally was told that the payment appeared to be related to the 1976 motion picture
Obsession,
a psychological thriller in which Robertson played a businessman who meets the double of his widow (Genevieve Bujold).
Obsession,
which director-writer Brian De
Palma derived in part from Hitchcock's
Vertigo,
had not been made under Columbia Pictures' aegis: the studio had purchased the finished movie from an independent film company and distributed it. Evelyn confirmed with Kahaner and Black that all of Robertson's fees from
Obsession
had been paid by the filmmaker. He was owed nothing and had received nothing from Columbia Pictures.
Cliff told Evelyn to demand a written explanation, and on Tuesday, March 15, she dispatched a letter to Columbia's accounting departm
ent asking the details of the $1
0.000 payment.
* *
*
Columbia Pictures' movie and television operations were situated at The Burbank Studios, a 105-acre tract at the north foot of Cahuenga Peak, one of the highest and steepest hills in the ridge separating the San Fernando Valley from the rest of Los Angeles to the south. The Burbank Studios, together with nearby NBC, Universal and Disney, formed the northern point of a rough, fifty-square-mile diamond within which were found just about all of the companies, facilities, and people comprising what the world at large thought of as "Hollywood," or the "Show Business Capital of the World." The eastern point of the diamond, as one looked at a map, was formed by Paramount Pictures and the ABC studios southeast of Burbank across the hills in the eastern part of Hollywood proper. The western point was the cluster of Beverly Hills, Century City, and the Twentieth Century-Fox studios southwest of Burbank across the hills in the western sector of Los Angeles. The southern point of the diamond was the Metro-Goldwyn-Mayer lot, housing MGM and Uni
ted Artists, a forty-five-minute
drive south of Burbank in Culver City, not far from the Los Angeles airport.
Columbia Pictures shared the thirty-eight sound stages and other facilities of The Burbank Studios with Warner Bros. The Columbia executive offices were housed in a striking two-story redwood, tinted glass, and concrete building with a central atrium at the northeast corner of the Burbank lot. The accounting department was on the second floor at the back.
When Evelyn Christel's letter arrived, the accounts-payable supervisor, Dick Caudillo, pulled the files and found that a check payable to Cliff Robertson had been drawn on September 2, 1976, at the request of the president of
the Columbia studio, David Bege
lman, the flamboyant former talent agent who had been running Columbia for nearly four years. Caudillo informed Begelman's office of the Robertson inquiry and was told that the money had been paid to Robertson to cover his expenses for a personal-appearance tour that he had made to promote
Obsession.
The inquiry took two weeks to make its way from Caudillo to David Begelman's office and back. Caudillo forwarded the information to Evelyn Christel on Monday, March 28.
What he forwarded was not the full story, however. Dick Caudillo, a stocky man in his early thirties, with thinning dark hair, did not tell Christel a curious fact which he found amusing. Cliff Robertson's inquiry was one of dozens of similar inquiries and complaints that had deluged the studio during those late winter and early spring weeks. The furor arose because Columbia, in tightening some of its accounting practices to conform to stricter rules of the Internal Revenue Service, had reported to the tax authorities, via the requisite Form 1099, a substantially greater number of "miscellaneous payments" for 1976 than it had reported for past years. Such payments—to actors, directors, producers, and a host of other people— were a way of life in the entertainment business. In addition to paying the salaries and fees prescribed in contracts for specific services such as directing or acting in a film, the studios also shelled out countless other payments under countless other labels, mostly to retain the goodwill of the recipients. A studio would give an actor $10,000 to cover his "expenses" on a promotional tour, knowing that the expenses would be only a fraction of the $10,000 but not asking for any accounting of unused funds. A director would do some extra work on a picture, and instead of being paid an additional fee, he would be given a new $30,000 automobile. Whether these payments were in cash, cars, or other tender, their tax status historically was in doubt. Theoretically, the payments were taxable, but the IRS never declared them so specifically and the studios rarely bothered to report them to the IRS. The aggregate result was the payment of millions of dollars of tax-free income that was widely taken for granted by those who received it.
In the seventies, however, the IRS explicitly ruled such payments taxable and also developed more sophisticated auditing methods to detect them. The studios, therefore, began reporting
more of the payments to the IRS,
with the result that income that had been tax-free suddenly became taxable. Many of the habitual recipients were incensed, and in the early months of 1977—the time for reporting 1976 income—angry letters poured into the Columbia Pictures accounting department. Of course, the recipients of 1099 forms couldn't officially berate the studio for obeying the law. So instead many people simply claimed that they had not gotten the payments indicated by the forms. Dick Caudillo would routinely locate the documentation for payments that were questioned and inform the recipients that they had, in fact, received the payments. Caudillo. a man who rather enjoyed pricking wealthy show business personalities with odious little government forms, assumed that the
Cliff Robertson inquiry was like the others and that a single letter of rebuff would end the matter, as it had in other cases.
When Evelyn reported to Cliff that Columbia claimed the $10,000 had been paid to him for his expenses on the
Obsession
promotional tour, he was mystified. Yes, he had traveled to three or four cities to promote
Obsession,
but he certainly hadn't been given $10,000 to pay his expenses. His accountants had been reimbursed after billing the studio directly, and the amount had come to far less than $10,000.
"What are you going to do?" Dina Merrill asked her husband one evening in the Fremont Place house shortly before he completed
Washington: Behind Closed Doors.
"Jesus, I'm not going to pay taxes on ten thousand dollars I didn't receive." Cliff said. "I'll just have to keep pressing until I get to the bottom of this."
The mystery began to perplex Cliff. He didn't think about it constantly or even frequently, but it had ceased being a minor oddity and had become an issue to be resolved. He told Evelyn to keep needling Columbia. The Robertsons returned to New York in April, and Cliff soon left for Ireland to write a screenplay.
When Evelyn again telephoned the Columbia accounting department. Dick Caudillo was away, but she left a message that she wanted a copy of whatever document the studio claimed to have dispatched to Robertson. She received nothing. In late April, she called again, and again Caudillo was out. She left the same message to no avail. On Thursday, May 26, she wrote another letter requesting a copy of the front and back of the canceled check.
Dick Caudillo again ca
lled for the Robertson file and,
for the first time, actually examined the check. It had been drawn on Columbia Pictures' general account at the main Hollywood office of the Bank of America; made payable to Cliff Robertson, 870 United Nations Plaza. New York City: and sent to the office of the studio president, David Begelman. presumably for forwarding to Robertson. The check bore the endorsement "Cliff Robertson." a bold, sweeping signature written with a felt-tipped pen. and also had been initialed with a ball-point pen. The check had been cashed on September 10. 1976—eight days after it was dated—at some branch of the Wells Fargo Bank in Los Angeles. It had cleared the Bank of America on September 13.
The more Dick Caudillo st
ared at the endorsement, the une
asier he became. Although he could not be sure, the endorsement looked very much like the handwriting o
f President David Begelman. Cau
dillo did not have anything else signed by Robertson with which to compare it. but he was intimately familiar with Begelman's writing, and this signature resembled it to a startling degree.
Choosing his words carefully, Caudillo phoned Evelyn Christel, apologized for the delay, and told her that a check payable to Robertson actually had been drawn and cashed. "The endorsement may not be Mr. Robertson's, though." he said. "It appears to have been endors
ed by someone whose initials are
right under the endorsement." He mailed her a copy of the check, and when she received it the next day she immediately phoned Caudillo and confirmed that the signature definitely was not that of Cliff, whose official signature was "Clifford P. Robertson" and whose handwriting was smaller and more delicate than that of the person who signed the check. Evelyn did not recognize the initials. Furthermore, no one had the legal authority to sign Robertson's name on his behalf. Caudillo and Christel agreed that there must be a reasonable explanation for the confusion and that they would investigate further and stay in touch.
Caudillo, however, had no intention of investigating further himself. He took the file to his immediate superior, the Columbia studio controller. Louis Phillips. Caudillo and Phillips had been close friends for years, and Phillips was the only person in whom Caudillo felt free to confide his suspicions.
"I think I know who signed tha
t check, Lou." Caudillo said. "I
think Begelman himself endorsed it."
Lou Phillips, a precise, careful man both in speech and manner, perused the check and correspondence. Without responding to Caudillo's fear, he said he would look into the matter and that Dick shouldn't concern himself with it any further.
THREE
James T. Johnson, the Columbia studio's vice president for administration, was fond of quipping that
he and Frank Sinatra were Hoboke
n, New Jersey's principal contributions to American show business. Although Johnson savored his company title and the accompanying perquisites, it was his nature to twit his modest role in the entertainment world rather than inflate it. Unlike many eastern street kids who had gotten CPA licenses, come to Hollywood, and put on airs, Jim Johnson had never bothered to smooth all of h
is rough edges and become a nove
au-snob. He owned a spacious four-bedroom house in Encino and drove a Cadillac provided by the studio. But at age thirty-eight, slender with dark hair, he retained, almost intact,
the coarse, jocular, one-of-the
-boys st
yle of his working-class-Hoboke
n adolescence. It was't immaturity, just boyishness and irreverence, and he could restrain it when necessary. But it gave him a versatility of temperament that normally served him well in his main function as the vice president for administration, which was to know everything happening at the Columbia studio and keep it running smoothly. He wasn't a meticulous administrator, but he was savvy—as sensitive to the proclivities of clerks and janitors as to those of production vice presidents. Very little escaped his attention.