Charlie

"This sawtooth pattern of revenue (see figure 8-2) would be virtually impossible for an independent, publicly traded insurer to explain to Wall Street. Because, however, Berkshire’s insurance subsidiaries are part of a much larger diversified company, they are shielded from Wall Street scrutiny. This provides a major competitive advantage—allowing National Indemnity and Berkshire’s other insurance businesses to focus on profitability, not premium growth. As Buffet has said, “Charlie and I have always preferred a lumpy 15 percent to a smooth 12 percent return.”3"

"Tex approached each negotiation from the other fellow's viewpoint first. What would be the best deal if you were the one being acquired? This, then, he translated so far as pos- sible into the terms that would be most advantageous to Litton. Both sides usually won, as in the example of Charlie"

"But, deluded by his own self-image of grandeur, Yablans simply couldn’t take this hit to his reputation… and he quit. Cold. Just like that. I didn’t hear it from him. His lawyer called. Sidney Korshak. In his deep, intimidating voice, Korshak said, “This isn’t working. He’s out, and we have to settle it.” I replied, “There isn’t anything to settle. I’m perfectly happy for him to stay if he wants. If he quits, which is what you’re telling me, then there’s no settlement, he just goes home.” Korshak said, in that low and menacing voice, “You seem like a nice kid, but you’re a little naive. I’ll deal with your boss,” and he hung up. Sidney went to Charlie, and fearless though Charlie usually was, he was a little scared of Korshak. Charlie then called to tell me, “Sidney thinks you’re being a hard-ass and we have to pay him something or things will deteriorate. *Unpredictably.*” Charlie hadn’t liked hearing that word, “unpredictably.” He’d told Sidney that I would be reasonable and to go back and work it out. But he said to me, “Don’t be *too* reasonable.”"

"Over the years, Charlie had attained an earned reputation for megalomania; along with that came a need to have a direct effect on any life he touched. The forces of his energy and power were almost impossible to resist. On meeting an actor for the first time, he was likely to say, out of the blue, “Why don’t I make you a director?” He was constantly trying to rearrange everyone’s life into something he could manipulate and control."

"Every day I was confronted with the realization that I’d come from clean-as-a-whistle government-regulated broadcasting into a business where ego and self-promotion corroded everything. It astonished me to see an entire company wired to the asses of its senior management. And the company’s owner, in the person of Charlie, acted like an old-time emperor. Between frantically buying companies and trading every hour of the day in whatever markets were open, Charlie would occasionally call me with his perennial idea for what he said would be the blockbuster of all time: the tale of Sitting Bull and Hitler at war with each other."

"Charlie started Gulf + Western as an auto-parts company, making the chrome bumpers on the front of cars. Before that, he’d been a coffee trader, and became a millionaire in his twenties. He could—and did—trade anything. He put the word “insatiable” into ambition, and he built his auto-parts business into one of the first conglomerates at a time when buying disparate businesses was popular, and before private equity took over the model. From auto parts to sugar to insurance in every corner of the world economy, he bought sound and cheap, using his stock to expand, each acquisition pushing the stock price higher and making the next acquisition easier. He was an industrial genius. An immigrant’s immigrant, he was more of an American patriot than Americans born generations earlier."

"I also believed that all this was the doing of a mad, willful, contrarian Austrian who was furious at the president of his company and wanted to use me to humiliate him. I was just an accessory to Charlie’s vengeful whim. Nevertheless, of course I couldn’t do anything but say yes, but with very little joy and not much enthusiasm. Here I was, thirty-two years old, being offered this opportunity, and yet all I saw was trouble and strife ahead."

"After our tumultuous first meeting at ABC, when Charlie tried to sell me all those bogus Paramount movies, we continued for years to haggle over those rights. He liked me because I was probably the only person in the entertainment business, probably in any business at this time in his ginormous career, who didn’t tell him exactly what he wanted to hear. Charlie started to call me frequently, usually just to rant about some transgression by his executives, sometimes simply to ask my opinion about this or that nefarious project he was being pitched. Charlie loved confrontation and argument, and from some devilish osmosis I learned never to give an inch when arguing with him."

"Paramount’s New York home office was in the mighty Gulf + Western Building, which had a perfect position at the southwest corner of Central Park. Years later, when Charlie was suffering from one of the many vicious attacks on his character in *The New York Times,* I wrote him a note saying, “The sun will never set on you or the Gulf + Western Building.” Charlie burst into tears reading it. Years after, that building was reclad and gussied up into the Trump International Hotel—and I can’t help but wish the sun had never risen on that."

"Of course, Charlie had loved the first movie, and about an hour after it opened, he already wanted a sequel: the story of what happened to Tony Manero once he crossed the river. Four years had passed since *Fever*, and still no one thought this was anything but a bad idea. Nevertheless, Charlie wouldn’t get off this dim sequel horse and I placated him by arranging a meeting with Travolta at the Hôtel Byblos in Saint-Tropez. Charlie romped around the room, trying to talk John into doing it. It was, of course, a stupid thing for John to agree to, but he was overwhelmed by Charlie, and he uttered an incautious yes. For no connected reason Charlie then met with Sylvester Stallone. He immediately called me and said, “I have a great coup! Stallone is going to direct the movie.”"

"A few months before he died, we were together in San Francisco. Charlie was in the Presidential Suite at the Fairmont hotel, and I was in the suite directly underneath him. We started having what was to be a long and sensitive phone conversation. At several points I said, “Why don’t I just come up and see you instead of talking like this?” Very firmly, he said, “No, let’s just keep talking,” which I thought was weird. It didn’t occur to me that he didn’t want me to see him wigless or in whatever poor shape he was in."

"It was one of those conversations that wasn’t designed to resolve anything, but it rattled around afterward in my head. I began to understand that this was Davis’s method: over the past months, he had ruthlessly weeded out Charlie’s loyalists in the company. And the way he asserted his authority was by forcing the number one person in each division to fire the number two person. Once he had done that, he had the balls of the number one guy in his pocket."

"The natural choice would have been to promote Jim Judelson as CEO. Though diminished by the overpowering Charlie, he was officially the number two person. He had a good record administering all the businesses, and while not personally impressive, he at least had the requisite qualifications. He certainly wanted the job, but his problem was that Charlie had been so dismissive of him for so long, frequently cutting him down and belittling him before the directors, that he had no standing of his own and little credibility."

"I watched the absurdity of these titans frozen in their positions. Slowly Charlie inched his way around to Kerkorian’s window, his hands up in surrender and apology. He shouted acceptance of Kerkorian’s price. Kerkorian simply nodded and drove off. Meanwhile, Wasserman shrugged and got in his car. A distraught Charlie walked back into the house saying, “I’m starving, I’m starving—bring on the hot dogs.” *Oh my god,* I thought, *I am so over my head.*"

"I’m fairly certain Charlie really thought that hiring me was a good comeuppance for Yablans’s arrogance and insubordination, but that after a while somehow Yablans and I would find common ground. Charlie and everyone else in the business thought Yablans was a genius distributor, and after he suffered a little humiliation, this would go the way most Hollywood relationships cynically went: the money would talk and no one would walk."

"Martin Davis asked me to come straight to his office as soon as I landed. It was around ten p.m. when I got there. He shocked me by saying that Charlie had been secretly sick for the last three years. They never discussed it, but he’d found out. Not much of a surprise, because Martin had a detective agency on the side that did all sorts of nefarious things and provided him with god-knows-what information. He didn’t know when Charlie was going to die, but he knew he was seriously unwell. He’d used those years to systematically ingratiate himself with the outside directors, waiting for the inevitable opportunity. No one else ever bothered much with the directors because Charlie was so dominant and thought to be indestructible."

"One day, as he was driving through the brush on a hill above the Chavón River, he got the idea to build an arts colony so that Dominican artists would have a place to create and show their work. He imagined something, in his words, like Saint-Paul de Vence, a charming medieval village in France. But, like with all things Charlie, it got way out of hand. He grandly called it Altos de Chavón, and hired Roberto Coppa, an Italian set decorator he met through Dino De Laurentiis, to take this French classic and turn it into a faux Italian village that made absolutely no economic or artistic sense."

"First, he began to sell the stock portfolio, which Charlie had brilliantly built up to almost $1 billion (a huge sum in 1983 dollars). If Davis had done nothing other than keep Charlie’s stock investments over the next ten years, they would have grown to be worth more than every other asset in the company. Davis then started to sell off the heavy-industry companies. Next he peeled off the insurance companies and all the other profitable businesses."

"On that call, Charlie spoke for the first time about the Gulf + Western corporation and his lack of anyone to rely on there. He said he needed someone to trust now more than ever and that he wanted to put me on the board. I was speechless. Nobody from any of the individual companies Gulf + Western owned was on the board, nor were any of the most senior corporate people. The board was entirely composed of outside directors. It was probably better that the hotel ceiling separated us. I didn’t want him to see that I had tears in my eyes. I didn’t know what it stemmed from, but I could hear the vulnerability in his voice when he quietly pleaded with me to keep our conversation secret until after the New Year, when he’d want me beside him at board meetings. It more than touched me that this business-busting titan wanted me to help him, to protect him as he felt more isolated and alone. We never spoke about it again."

"The only other senior man the board knew was Don Oresman, a cynical and tricky lawyer from the firm of Simpson Thacher who, as outside counsel for the company, attended all the board meetings. I had no clue then—but came to understand later—that Oresman and Davis, knowing Charlie was sick, had been plotting together for years to take over the company."

"Charlie yelled at me to come into the room and put me on the phone with Lew, who was also rather startled at the news about the new statehood of his daughter’s childhood friend. I was hardly someone he took seriously, but like everyone else in Hollywood, he didn’t much like Yablans, so he congratulated me heartily. The ever-charming Wasserman told me he always knew I’d go places when, as a twelve-year-old, I’d beaten his wife at gin rummy at their Palm Springs house."

"They told Charlie that, and he said, “I’m not going to be threatened by anyone; he’s a common thief and ought to be prosecuted.” The district attorney had an easy case: Dolkart had stolen nearly $3 million, absolute clean thievery, with no extenuating circumstances. However, Dolkart did indeed go after Charlie, saying that he had committed various crimes of self-aggrandizement and SEC filing errors. Dolkart ended up becoming a government witness, never served a day in jail, and never paid back the stolen money. And Charlie went through five years of absolute, and absolutely undeserved, hell as a result."

"All through that summer of 1974, there was a Shakespearean plot developing around this triangle of outsized personalities. Neither Charlie nor Yablans/Evans ever knew that I was surreptitiously talking to Andy Tobias. When I heard from Andy how vicious Yablans was in characterizing Bluhdorn, my motivation was to do as much as I could to make certain Charlie wouldn’t be unfairly or negatively portrayed. Hard going given the delectable tidbits Yablans was throwing out. Andy told me Charlie wouldn’t agree to be interviewed, so it was up to me to be his defender. It never once occurred to me that I was helping to open a door I would soon be walking through. And, anyway, I was awfully busy just trying to save my ABC schedule from disaster."

"I had come to know that when Charlie was dead serious about something, his whole demeanor would change from unimaginable boisterousness to being still and pensive, speaking slowly and softly. Finally he quietly said, “I’m not replacing you, so stop this nonsense and go back downstairs and get back to work.” Charlie wasn’t ready to give up on me. He couldn’t accept his instincts about me were wrong. While he bellowed constantly, he’d never lost faith in me."

"“Charlie and I always knew we would become very wealthy,” he told us, “but we weren’t in a hurry.” After all, he said, “If you’re even a slightly above average investor who spends less than you earn, over a lifetime you cannot help but get very wealthy—if you’re patient.”"