What Ails Michael Eisner? A Corporate Tyrant Dissected

DisneyWar, by James B. Stewart. Simon and Schuster, 572 pages, $29.95.

Thirty-odd years ago, it would have been, I was summoned to the office of Frederick L. Ehrman, chief executive of Lehman Brothers, the firm of which I was then a partner, and informed that I had been accused by Darryl F. Zanuck, C.E.O. of 20th Century Fox (of whose board of directors I had been a member for a couple of years), of conspiring with David Merrick to take over the company. According to Ehrman, Zanuck had informed Lehman Brothers that unless I resigned from the board and Lehman substituted another partner, Zanuck would take his investment-banking business elsewhere.

I replied that the accusation was patently false and a straw man: My real crime, in Zanuck’s eyes, had been to question the propriety, at a recent board meeting, of awarding him a 40 percent raise just as the company was about to announce the largest loss in its history. Zanuck had been furious at the time and had clearly not forgiven me.

My argument cut no mustard; I was shortly gone from 20th’s board and Ehrman himself took my place. Sic semper virtutis.

Now fast-forward three decades, to November 2003, to the opening scene of James B. Stewart’s engrossing if ultimately exhausting DisneyWar, which will surely be the most talked-about book of the season among those people-many of whom are numbered among the readership of this paper-for whom a masthead change at Condé Nast is of more poignant human import and graver cosmic significance than, say, a genocide in subequatorial Africa. (Who knows? They may be right.)

Anyway, in the scene as painted by Mr. Stewart, Roy E. Disney, Walt’s nephew, a 50-year veteran and important stockholder, upholder of the company’s great tradition of animation and a longtime Disney director, arrives at a Pasadena restaurant for a meeting with another member of the board. Roy Disney is apprehensive and troubled. He thinks the company is being run into the ground by its longtime C.E.O., Michael Eisner; he has spoken up against Mr. Eisner’s compensation at a time when the company is doing badly; and he’s afraid Mr. Eisner is moving to stifle dissent.

His fears prove well grounded. He is advised by his fellow director, a man whose wife is employed by Disney at a salary of over $1 million a year, that it has been “concluded that you shouldn’t run for reelection.”

“Roy … was speechless,” Mr. Stewart writes. “He felt like a knife had been stuck into his heart …. It wasn’t just that he was still one of the company’s largest shareholders. He had given fifty years of his life to Disney. He was the only direct link to Walt on the board.”

When I read that and recalled my own Hollywood experiences, I thought-with no satisfaction at all-”Well, some things never change.” And then I thought of the veteran screenwriter William Goldman’s famous dictum, “In Hollywood, no one knows anything,” and reflected that Mr. Goldman may be right as far as making movies is concerned, but when it comes to fucking each other over, the people out there wrote the book. And that book is this book.

Here, I suppose, I should declare an interest or two. I consider Jim Stewart a friend, although that friendship has consisted of perhaps a dozen entirely happenstantial encounters in the 14 years since we first met following my (favorable) review of Den of Thieves (1991) on the front page of The New York Times Book Review. I admire him as a reporter and a writer, and I value our cordial acquaintanceship.

I also have certain feelings about Disney. Not about its “iconic” place in American popular culture, the sort of pap from which DisneyWar is mercifully and blessedly free. (Mr. Stewart’s book is about the mismanagement of a company, not the desecration of a holy place, although Roy Disney might say it’s also the latter.) No, I think of Disney because it fell out that in the late 60′s and early 70′s, I also worked on their investment-banking business, on which we were “joint account” with Kidder Peabody, in close but subordinate harness with the late Joe Rosenberg, Lehman’s L.A. partner-who, back in the 1930′s, when he was at the Bank of America, loaned Walt and Roy O. Disney (Roy E.’s father) the money to make Snow White. We went way back with the Disneys, in other words, and it is hard to read much of what Jim Stewart has written without a certain pang.

I have neither the inclination and the space to regurgitate the “plot” of DisneyWar or to synthesize or synopsize the material. The book has been excerpted in The New Yorker and The Wall Street Journal, and been reviewed and written about elsewhere. Because I was reading it for review, I plowed straight through, but had I bought it for myself (and I surely would have, and not regretted a penny of the investment!), I would have done more dipping and skipping. It’s an intense, dense piece of work. No one would wish it longer. Indeed, there were times-after encountering yet another of Michael Eisner’s pathological, ultimately self-destructive changes of attitude-when I was reminded of one of those cute children’s sayings of the kind compiled by Art Linkletter, a third-grade book report that went, “This book tells me more about penguins than I care to know.”

And yet I do not think Mr. Stewart could have done otherwise. This is one of those stories that requires that all of it be told if any of it is to be understood. It cumulates: meeting by meeting, small treachery upon small treachery, memo by memo.

At the center, of course, is Michael Eisner, who came to Disney as a 42-year-old wunderkind, although such wunderkinder frequently make their bones as No. 2 to a born No. 1 (in Mr. Eisner’s case, Barry Diller) and end up confronting their own limitations, which is what may have happened here.

After more than 500 pages, I’m not sure what to make of Mr. Eisner as Mr. Stewart presents him. Is he nuts? Does he suffer from A.D.D.? What is the compulsion that, time and again, causes him to raise someone up and then, the minute that person is installed on a rickety stool next to the Eisner’s throne, to start to kick the legs out? In his epilogue, Mr. Stewart compares Mr. Eisner to those Shakespearean monarchs “whose power is such that [they] bend the truth itself to suit [their] will,” and he cites as Mr. Eisner’s overriding negative trait “his dishonesty.”

Well, I don’t know. Something compulsive is at work here, something much fiercer than mere dishonesty, a kind of paranoia. As I read, there came to the tip of my tongue the name of someone to whom Mr. Eisner’s pattern of treacherous, dissimulating behavior seemed authentically similar, but it was a while before I got who I was trying to think of: Stalin. No one was ever dragged out of the “Team Disney” building and summarily executed on Donald Duck Drive on the tyrant’s orders, but in the Hollywood scheme of things they might as well have been; and on page after page, the mood of Mr. Eisner’s minions as they whistle their way to work is just what you’d find on a gray morning at the Lubyanka. Oddly, unless I missed something (and I went back to the index and double-checked), Mr. Eisner at no time seems to have sought or obtained either therapy or medication. To have behaved this way this long without calling for the Prozac either testifies eloquently to strength of character or to outright lunacy.

In this area, as in others, Mr. Stewart is both limited and advantaged by his sources. People were reluctant to talk for the record, so we can only guess what Michael Ovitz told Mr. Stewart, or didn’t; or Sid Bass, or Warren Buffett-who ended up with a bundle of Disney stock when Mr. Eisner bought Cap Cities, and presumably sold it forthwith. On the other hand, Mr. Stewart had access to all the court papers filed in the two lawsuits in which two of Mr. Eisner’s “best friends,” Mr. Ovitz and Jeffrey Katzenberg, were handed, properly (according to their contracts), some $420 million of the Disney stockholders’ money- and with his lawyer’s training, Mr. Stewart knows what to make of the rich evidence presented in discovery. Including Mr. Eisner’s own literary testament: The man seems like a kind of pre-blogger, in that he shares present-day bloggers’ vain absorption with their every utterance, and can’t help writing it all down in a way that’s clearly intended to show off as well as to inform.

DisneyWar is a plum pudding of a book: It repays the probing or roving finger with many a choice sweetmeat. Obviously, the gossip will attract many readers. I would think a close reading essential if one is to hold one’s own at the dinner table of, oh, a Stephen Schwarzman, himself the apparently willing recipient of a reportorial whoopee cushion a couple of months or so ago in The Times. Certainly everyone in Hollywood will devour it-or already has. Yes, it might have been more aggressively line- and copy-edited (on page 508, I think “dispersed” was meant, not “disbursed”). Just take it more slowly than I was able to, and it will repay this more measured pacing a dozen times over. It’s one of those books that needs (and deserves) to be read as it is written.

In a larger context, it seems to me that DisneyWar completes a virtual trilogy-the other volumes being Bryan Burrough and John Helyar’s Barbarians at the Gate (1990) and Mr. Stewart’s own Den of Thieves. Together, they vividly capture the whole arc of what, to my thinking, has emerged as the great business/finance story of the mega-cycle that began in August 1982, when the stock market broke out. It’s the story of the evolving abuse of “insiderness” in the Greenspan era of (virtually) free money. If there’s to be a fourth volume, I dare say it will feature real heads on real pikes. But for the nonce, Michael Eisner’s grinning face impaled on James B. Stewart’s elegant prose and exhaustive research will do just fine.

Michael M. Thomas writes The Midas Watch for The Observer.