Behind Paramount's Gates, an Air of Uncertainty : Industry: On the surface it's work-as-usual as the QVC-Viacom fight over control of the studio drags on.

By ROBERT W. WELKOS

Dec. 24, 1993 12 AM PT

TIMES STAFF WRITER

By outward appearances, Paramount Pictures is a studio humming with activity this Christmas season.

The Eddie Murphy action/comedy “Beverly Hills Cop III” will be wrapping soon and the Tom Clancy thriller “Clear and Present Danger” with Harrison Ford is well into its shooting schedule. Paul Newman, Jessica Tandy and Melanie Griffith are busy filming “Nobody’s Fool” in New York state, while “Forest Gump,” starring Tom Hanks, and “Lassie” starring, well, Lassie, recently wrapped.

And about to start shooting are director John Badham’s “Drop Zone,” a film about a U.S. marshal who gets involved in skydiving while investigating the murder of his partner, and the contemporary drama “Dexterity,” for which negotiations are under way for the lead roles.

But beneath the surface, Paramount is a studio ill-at-ease.

The titanic struggle between Barry Diller’s QVC Network Inc. and Sumner Redstone’s Viacom Inc. for control of entertainment giant Paramount Communications Inc. has had an unsettling ripple effect on the fabled studio.

On Wednesday, Diller won the inside track after Paramount’s board of directors recommended a merger with QVC. Viacom, however, could still up the ante.

Still, with Diller poised to assume power, the movie industry was abuzz with rumors of what this would portend for the studio. Diller himself refused to discuss his plans on Thursday.

Since the Delaware Supreme Court ruled in QVC’s favor earlier this month, many filmmakers have been holding back taking projects to Paramount, waiting to see who wins.

At the studio itself, motion picture chairman Sherry Lansing continued working as if all were normal--even though it wasn’t. Over the weekend, she took home seven scripts to read and spent the week negotiating deals with directors, producers and actors.

But despite this atmosphere of work-as-usual, some filmmakers who have overall deals at Paramount aren’t taking any chances.

In recent weeks, several big-name producers on the lot have quietly renegotiated their contracts, inserting “key man” clauses into them so that if Lansing and her boss, Paramount Communications President Stanley R. Jaffe, are forced out--or, in some cases, just Lansing--the producers are also free to depart.

The air of uncertainty caused some industry insiders to complain that Paramount was once again being paralyzed by indecision in getting projects off the ground--a complaint the studio flatly rejects.

“Everything is kind of in limbo at Paramount,” complained one agent, who said his large agency makes Paramount one of its last stops when peddling scripts these days.

“Everyone would be glad to make movies at Paramount--if Paramount made movies,” complained an entertainment attorney.

In the year since taking office, Lansing has generally received high marks for turning around Paramount Pictures, which was left virtually moribund under the prior regime of Brandon Tartikoff.

But some say the continuing war on Wall Street is making filmmakers step back and wait to see the outcome of the QVC-Viacom war before taking their projects to Paramount. They wonder if Lansing and Jaffe will even be around in the next few months--whether or not Diller wins.

As one industry source said: “Who wants to take their movie to a place where you don’t know what the future is? People are very short-sighted in this town.”

But comments like these make Paramount executives bristle. They point out that the studio plans to release 20 films in the next year--far more than Columbia Pictures or 20th Century Fox--and the goal is to eventually reach 25 films.

They also note that in recent days, Lansing has green-lighted “Losing Isaiah” for producer Howard W. Koch Jr., a film based on the Seth J. Margolis novel about a child torn between his estranged birth mother and the family that raised him; and the romantic comedy “I.Q.” for producer Scott Rudin. Lansing also has spent the week trying to get directors for “The Saint” and has just attached director Harold Becker to the Tom Cruise project “City Hall.” Lansing also has given a “blinking green light” to a remake of the Audrey Hepburn/Humphrey Bogart romantic comedy “Sabrina.”

“The studio is as busy as it has ever been,” said one Paramount executive. Lansing declined to comment.

This summer, the mood at Paramount had been upbeat with the enormous box-office success of the John Grisham legal thriller “The Firm,” starring Tom Cruise, which to date has grossed more than $158 million. Since then, however, the studio has stumbled with such disappointments as “Searching for Bobby Fischer,” “Flesh and Bone” and the two highly anticipated holiday sequels “Addams Family Values” and “Wayne’s World 2.”

Paramount pulled from its Christmas release lineup Mark Rydell’s “Intersection,” with Richard Gere and Sharon Stone, which due to a rushed post-production schedule and reportedly other problems forced its delay to early ’94.

Meanwhile, Hollywood insiders were buzzing at pre-holiday lunches about what a Diller victory might mean for the studio.

“Everybody is talking about Jaffe being out,” said one agent. “That seems to be the general consensus. Stanley’s been there a long time and nothing really has happened (movie-wise). Most people feel, no matter who gets in there, Redstone or Diller, everybody is kind of looking for a job.”

“Everybody likes Sherry in the whole community, and they’d be sad to see her go, but I think she will be punished for the sins of her elders,” said the agent of one top movie star who has had a long relationship with Paramount.

One executive at a rival studio suggested, “Barry may want to keep Sherry, who knows?” The source added, “The only one who definitely will be gone is (Paramount Communications chairman) Martin Davis.” It is well known that there is bad blood between Diller and Davis dating back to Diller’s days at Paramount when he ran the studio.

If change does come, the question of whom Diller might tap to head the studio is Hollywood’s biggest guessing game of the moment, since strong executive talent seems to be scarce these days.

One scenario being floated is that producer Dawn Steel might be asked to head a revamped Paramount. Steel, who recently produced “Cool Runnings” for Disney, worked for Diller at Paramount from 1978-84 and rose through the ranks to senior vice president of production under (now Disney chairman) Jeffrey Katzenberg, when he headed production.

Steel, who is poised to head up Ted Turner’s film company Turner Pictures, said Diller had not approached her about running Paramount. While Steel, who headed Columbia Pictures from 1987-90, said she was a big fan of Diller’s, “I am so not interested in doing it again . . . but if he wants to give me my own shopping channel. . . .”

Another scenario making the rounds has Katzenberg, for the past nine years chairman of Walt Disney Pictures, jumping to Paramount to work for his former boss Diller. Disney sources flatly reject this scenario, however.

“Barry Diller started this rumor to make his offer look more appealing,” said a Disney source. “Jeffrey Katzenberg is going nowhere, never has been going anywhere and has no plans of leaving Disney at all. Why would anyone want to work twice for Barry Diller in a lifetime?”

Whoever goes or stays, one thing is certain. Those Paramount executives who own stock options will win.

“The bottom line is that they will make so much money on stock options that they will all leave rich,” said an industry executive. “It’s good Christmas news for everyone.”