REDSTONE ROCKET FIRED AT CRUISE MISSILE
In an action that seemed destined to send Tom Cruise scurrying back to Scientology's E-meters to discover the source of his recent tribulations, Paramount Pictures on Tuesday dropped him and his production company after an association of some 14 years. In an interview with the Wall Street Journal, Viacom chairman Sumner Redstone commented, "As much as we like him personally, we thought it was wrong to renew his deal. ... His recent conduct has not been acceptable to Paramount." Redstone was presumably referring to Cruise's couch-jumping antics on Oprah Winfrey's talk show and his ballistic interview with Matt Lauer on the Today show about Scientology and psychotropic drugs. "We don't think that someone who effectuates creative suicide and costs the company revenue should be on the lot," Redstone added. In an interview with today's (Wednesday) Los Angeles Times, Cruise's production partner, Paula Wagner, denounced Redstone's remarks. "It is graceless. It is undignified. It's not businesslike," she said." In a separate interview with Daily Variety, she pointed out that during the last six years, Cruise/Wagner movies have accounted for 32 percent of Paramount's theatrical revenue. The Times account further noted that Paramount and Cruise/Wagner had been negotiating a renewal deal that would have cut the studio's commitment to pay them $10 million in overhead and development costs. Citing unnamed sources, the newspaper said that Paramount had offered them $2 million a year plus a $500,000 discretionary fund for each of two years. When Cruise/Wagner turned down the deal, Paramount Chairman Brad Grey prepared to announce an amicable end to the relationship, the Times said, citing one source. Grey and Viacom CEO Tom Freston were reportedly upset by Redstone's comments and told the newspaper's sources that he had not discussed his views about Cruise during the negotiations.
CLASS ACTION SUIT FILED AGAINST IMAX
A class action lawsuit was filed against IMAX in federal court in New York Tuesday claiming that the giant-screen operators cooked their books in the fourth quarter of last year in order to attract a buyer or merging partner. The complaint claims that IMAX violated federal securities laws when it included in its SEC filings misleading statements about its financial health, including claims that it had received revenue from theaters that were not even open. On Aug. 9, IMAX acknowledged that it would respond to an SEC inquiry about its accounting practices, including revenue recognition issues. The news sent IMAX shares plunging to $5.73 per share from $9.63. They were trading at $5.11 in midday trading today (Wednesday).
SONY BUYS VIDEO WEBSITE FOR $65 MILLION
It may draw only a fraction of the crowd that its rival YouTube attracts, but Sony Corp. has concluded that Grouper.com, another site that sports goofy videos, was worth $65 million. Besides, as the Los Angeles Times observed in reporting the sale of Grouper to Sony, analysts figured that "YouTube's price was probably too high to justify the risk." The newspaper also noted that Grouper runs little advertising because ad buyers "are leery of their messages appearing next to risqué or extreme clips." Sony Pictures CEO Michael Lynton denied that his intention was to use Grouper to promote its movies. "It's not as much a way of promoting our movies or television shows as a stand-alone business that has growth opportunities," Lynton told the Times. "The idea is for Grouper to stand on its own two feet and make money for us."
SNAKES IN A THEATER
Pranksters in Phoenix released a snake in a theater showing Snakes on Plane last Friday and another in the theater's parking lot, Reuters reported today (Wednesday). A spokeswoman for the AMC theater chain said that the two snakes were removed and later released in the desert. "No one was harmed," she said.