The release stated that
Begelman
had repaid the money with interest, toge
ther with an additional $23,200,
"representing adjustments of travel, entertainment and other expenses." It then quoted Alan
Hirschfield
:
The Board of Directors and I
are
pleased that we
are able to reach the conclusion that David
Begelman
shall continue as the President of the Motion Picture and Television Divisions even though he will not serve as a director or officer of the Company.
Our record over the last four years to which David contributed greatly speaks for itself and we all look forward to continued progress.
At Columbia's Paris offices on the rue Troyon Monday morning, Hirschfield encountered Norman Horowitz of the TV division, who was in Paris on business separate from Hirschfield's. They had not spoken privately since the first Sunday in October when Horowitz had been forced to miss an
est
seminar in order to attend Hirschfield's briefing at his hotel bungalow on the imminent suspension of David Begelman. Norman Horowitz, who was in charge of both domestic and international distribution for Columbia Pictures Television, traveled a lot and had been unable to follow closely the unfolding of the
Begelman
drama. But he felt considerable affection for both Hirschfield and Begelman, and had grown concerned about both men, especially during the past two weeks as the studio rumors of Begelman's fate changed almost daily. Seizing the opportunity in Paris, Norman Horowitz took Hirschfield into a vacant office and closed the door.
"Alan, what the fuck is going on?"
"He's coming back."
"He's coming back? Is it definite? We can't run our businesses with all this uncertainty! He is, he isn't, he might be, they
are
, they aren't!"
"Well, it won't be uncertain much longer. The release goes out today, as a matter of fact." Hirschfield sank into a chair and looked at Horowitz. "Norman, they're killing me," he said. "The board won't let me make a fucking decision. Those cocksuckers go to David. They review everything with David. I've got him in my life whether he's officially in the company or not. So I might just as well have him in the company where I can handle him better. I had no choice. They wouldn't let me run the company without Begelman."
"Holy shit!" said Norman Horowitz.
Oblivious to the compromise of the secrecy of his negotiations with Jimmy Goldsmith, Alan and
Berte
enjoyed another festive evening. Alan was feted at a large cocktail party at Ledoycn attended by many celebrities of the French film community, including Francois Truffaut, who had an important role in
Close Encounters of the Third Kind.
As flashbulbs popped, the Hirschfields shook upwards of two hundred hands. Later in the evening Alan hosted a dinner for fifty in a private room at Lasserre. He and
Berte
flew back to New York the next day.
In an unprecedented event in motion picture business history, wrote Art Murphy in Tuesday's
Variety,
David
Begelman
has been reinstated as president of Columbia Pictures and Columbia Television, though he'll not return as an exec or director of the parent, Columbia Pictures Industries.
Emotional problems and current psych-therapy
are
indicated in the formal announcement of his reinstatement. . . . When
Begelman
was first suspended on full pay, his chances of reinstatement were deemed virtually non-existent. Although he had a long-term contract, he certainly was not in a position of strength as to negotiating a settlement. But a combination of factors—including widespread support of many board members and much industry support,
...
in time worked to Begelman's advantage. . . .
Begelman
quite early in the affair freely conceded that some of his actions might be debatable as to their judiciousness and propriety, and Hollywood has raged with assorted rumors as to what the facts were. . . .
Murphy's article specified neither the rumors nor the facts, but
The Wall Street Journal,
in a lengthy article that day. reported that
Begelman
's "improper means" of obtaining money to which the press release referred actually involved the forgery of checks and the use of the names of Cliff Robertson and Martin Ritt. Coming eleven weeks after the announcement of Begelman's suspension, the
Journal
article was the first public disclosure that what Columbia Pictures first had called "unauthorized financial transactions." and then labeled "improper means." were in fact outright embezzlements and forgeries. The
Journal
also described the fight within the board of directors, named Ray Stark as Begelman's principal supporter outside the company, disclosed the involvement of the police and the Securities and Exchange Commission, and identified Begelman's psychiatrist. Dr. Judd Marnier.
Cliff Robertson and Dina Merrill sat in their UN Plaza apartment thirty floors above the East River with
The Wall Street Journal
article spread before them. To Cliff Robertson, Columbia's reinstatement of Begelman not only was a brazen flaunting of justice, but also a deep insult to Cliff personally. Although it had been foreshadowed by Dina's encounter with Terry Allen Kramer at
"21"
and although Cliff had doubted that Columbia's internal investigation was sufficiently thorough or independent, he still found it difficult to believe that a major U.S. corporation, in the wake of Watergate and widespread corporate bribery scandals, would knowingly employ an embezzler as one of its highest officers, whatever the extenuating circumstances. Cliff, moreover, was embittered and demoralized by his own apparent impotence in galvanizing law enforcement authorities to action. The Los Angeles police. The Burbank police. The Beverly Hills police. The FBI. After he had lost faith in the Los Angeles authorities, the FBI had seemed genuinely concerned. What had it been doing for three months?
Cliff felt like a fool. He had exposed a criminal. He had put the criminal's employer on notice, as well as four law enforcement agencies. Nothing had been done. No, that wasn't quite correct. Something had been done. The criminal's company had placed him on "leave of absence," and "investigated." Not only had the inquiry confirmed Cliffs original allegation. It had found other embezzlements as well—"a number of separate and unrelated transactions," the press release called them. Then, in an extraordinary display of brazenness, the company had simply restored the criminal to his job, one of the most important in show business.
Begelman and the rest of the Columbia people must really be chortling at me, Cliff thought. He was enraged.
Should he just drop the whole thing? Did he have any other recourse?
Cliff had thought about the press, but he had promised Leo Jaffe and others that he would not discuss the matter publicly. He had kept his promise. But then his name, along with an account of Begelman's crimes, suddenly appears in
The Wall Street Journal.
The secrecy which Columbia had managed to preserve for three months was broken. It seemed to Cliff that his promise of silence therefore was moot.
Cliff thought about Watergate and
The Washington Post. Washington: Behind Closed Doors
had just been on television. Cliff had liked the film and was proud to have been a part of it.
In complete agreement with all of his thoughts and feelings, Dina picked up the telephone and called her long-time friend Katharine Graham, the chairman of the board and publisher of
The Washington Post.
"Cliff has a story to tell your newspaper, Kay."
THIRTY-SEVEN
When Hirschfield arrived at his office Wednesday morning, having returned the night before from Paris, he was confronted immediately by Leo Jaffe. "Herbert is looking for you," Jaffe said. "He's on the warpath about some meeting you supposedly had with Jimmy Goldsmith." Hirschfield looked surprised, then recovered to a neutral stare. "Thanks, I'll call him," he said.
Can't anybody keep a confidence in this world? Hirschfield thought. He considered phoning Ira Harris, or David Karr, or Jimmy Goldsmith, but he
knew it was too late. Herbert All
en, indeed, was furious.
"If you want to sell the company, don't you think you have an obligation to talk to me first?" Herbert said. "We came in together, and if we're going to go out, we should go out together."
"I'm not trying to sell the company."
"You talked to Jimmy Goldsmith last Friday and you talked to David Karr over the weekend about selling the company."
"If you'll calm down for five minutes, I'll be happy to tell you what h
appened. Goldsmith wanted to see
me. I had drinks with Ira u couple of weeks ago and told him how unhappy things were in the company. He already knew things were a mess. He suggested that Goldsmith might have an interest in the company. Would I meet with him? I said fine. I met with him. I knew he knew your uncle well. I left it that I would report back to you, and if Goldsmith had any interest and you had any interest, he'd be in touch with you."
"Why did you do it behind my back?"
"I
didn't do it behind your back. I
was going to brief you. This is my first day back in the office."
"You
did
do it behind my back! You set all these wheels in motion without a word to me. It doesn't make any sense. First of all, it's personally insulting to me. We came in together, and at this stage for you to be trying to sell it out without me is wrong. Just plain wrong! Second of all, it's stupid of you to think you could get by with it. It's a very small world out there."
"I didn't intend to keep it from you. If I'd been trying to pull something like that, I certainly wouldn't have gone to somebody who knows your uncle and your firm. This isn't some Arab mystery man. It's a man who knows your uncle and who certainly would be in touch with him and with you if he had any interest."
"It was underhanded, and it was wrong, and I won't stand for it! And the board won't either. This hasn't done you any good with the board. I've told them about it. It's not a way to repair relationships." Herbert Allen strode from the room.
The Columbia Pictures bureaucracy in Burbank and New York, which had been jolted by the suspension of David
Begelman
in October, and then enervated by the protracted investigation, was stupefied by
Begelman
's restoration.
Studio executives and staff members knew by December that his acts were much more serious than questionable expense claims, and many knew, or at least had heard, that he had forged checks and embezzled funds. While many of these people felt affection and sympathy for David, they tended to be somewhat cynical about the psychiatric rationale for his crimes, and they believed, all things considered, that his suspension should be made permanent. "You can rest assured that there is no fucking way that David Begelman is coming back to this company," Alan Hirschfield had told Jim Johnson, the vice president for administration, on the day after Thanksgiving.
When word of
Begelman
's likely return began spreading the morning after his long Sunday mee
ting with Hirschfield in Scarsda
le, the studio people at first thought it was just another rumor. When the decision was ratified by the board four days later, and announced publicly on Monday, December 19, they were benumbed and, in varying degrees, disoriented. Dan Melnick, John Vei
tch, Jim Johnson, Eli Horowitz*,
Norman Levy, and the others had adjusted to life without David Begelman. Not all of them were morally outraged at Begelman. Not all of them felt that Hirschfield's motives were entirely pure. But they had accepted
Begelman
's departure as unavoidable, and they looked forward to the naming of a replacement and a return to normalcy at the studio.
Since Hirschfield had gone to Europe for a week, the task of briefing the principal studio people fell to Joe Fischer, who was deeply dismayed himself by
Hirschfield
's sudden reversal but was resigned to it. Although Fischer was kept from total candor by the secrecy of the boardroom and the extreme sensitivity of certain issues—the controversy over Berte Hirschfield's employment, for instance—he tried, in many lengthy conversations in his New York office and over the phone to California, to convey a sense of the extraordinary pressure on Hirschfield and to convince the staff that reinstatement, in the end, was the only way to end the war. Fischer asked that personal feelings be put aside and that both Hirschfield and
Begelman
be supported, as they tried to resume normal management of the company. Fischer's entreaties were only partly successful, and by the middle of the week before Christmas, a mood of dispirited resignation cloaked the studio.