Suit Filed Over Troubled 'Jackson Family' Benefit
April 01, 1994
Emmy-winning producer Gary Smith filed a lawsuit Thursday against Jackson family members charging fraud and breach of contract in connection with the financially troubled "Jackson Family Honors" musical benefit.
The 30-page complaint filed on behalf of Smith-Hemion Productions Inc. in Los Angeles County Superior Court alleges that Jackson family-affiliated firms refused to pay an estimated $2 million in outstanding bills and misrepresented information regarding past debts that allegedly jeopardized the fiscal state of the production. Ten family members are named individually as defendants, including superstar Michael Jackson, as well as the family's Jackson Communications Inc. and Jackson Jubilee, plus Transworld International, the firm that negotiated the foreign broadcast rights.
The Jackson firms, the complaint said, are "mere shell corporations" and that they and their shareholders are responsible for "the commingling of personal assets and funds."
"Never in my entire career have I had to deal with such an unprofessional mess as this," said Smith, producer of the telecast who along his partner Dwight Hemion has won five Emmys since 1962.
"The Jacksons asked me to hire people to work on their show and now, six weeks later, they refuse to pay them. And frankly, they've been very arrogant about it. This is an extremely difficult step for me to take, but the Jacksons have left me no choice but to sue."
Smith's suit alleges that the Jacksons pledged the same funds raised from ticket proceeds and foreign broadcast fees to at least two separate entities. It also alleges that members of the Jackson entourage charged $69,000 in expenditures for wardrobe and room service at the MGM Grand Hotel in Las Vegas where the Feb. 19 musical benefit was taped to be aired three days later on NBC-TV.
Jermaine Jackson, executive producer of the show and president of Jackson Communications Inc., said he had not seen a copy of the suit, but denied the allegations.
"For Gary Smith to sue us is unjust and unfair," Jackson said. "For him to say we are arrogant is very unprofessional. But what's new? It's just another dagger being thrown at the Jacksons in public."
The suit also alleges that Michael Jackson has failed to pay Smith-Hemion $110,000 for tickets he purchased and claims that the event's financial problems stem in part from the superstar's refusal to appear at the special's originally scheduled date of Dec. 11 in Atlantic City.
The show was postponed after Jackson fled to Europe in November to reportedly treat a drug addiction that he said stemmed in part from a 13-year-old's allegations of sexual molestation.
A series of complications resulted, including the loss of corporate sponsorships, debts incurred by postponing and moving the event to Las Vegas and slow ticket sales. Since the event, financial disputes over possible ticket refunds have tied up concert proceeds and revenues from foreign broadcast fees are still forthcoming.
Representatives for Michael and Janet Jackson said the two superstars had nothing to do with the event's finances.
http://articles.latimes.com/1994-04-01/entertainment/ca-41165_1_jackson-family-honors
Financial Woes Surround Jackson TV Special : Concert: Charities will receive $100,000 of the estimated $4.5 million raised even though production was billed as a benefit. Producer says cast and crew are still owed about $2 million, and money from ticket sales has been tied up.
The "Jackson Family Honors" NBC-TV show was brutally panned by critics when it aired Feb. 22, but the mishaps on camera were nothing compared to the financial imbroglio unfolding behind the scenes.
Five weeks after the show was taped at the MGM Grand hotel in Las Vegas, the producer says the cast and crew of the 200-member production are still owed about $2 million--with little evidence of money to pay them.
"The Jacksons refuse to pay the money they owe me, and as a result I'm unable to compensate the people I hired to work on the show. The most frustrating part is how arrogant they act about it. In fact, Jermaine (Jackson) has never even called me since the show."
The financial problems stem in part from the fallout of sexual molestation allegations made against Michael Jackson last summer by a 13-year-old boy. A series of complications resulted, including the loss of corporate sponsorships, debts incurred by postponing and moving the event to Las Vegas, and slow ticket sales. Since the event, financial disputes over possible ticket refunds have tied up concert proceeds, and revenues from foreign broadcast fees are still forthcoming.
Smith and others affiliated with the production also accuse members of the Jackson entourage of running up expenditures on security, wardrobe and limousines in the days leading up to the event.
Various sources said the Jacksons spent at least four times more on room service than the $5,000 going to the Library of Congress' American Music Program--one of several charities advertised as a beneficiary of the concert's net proceeds.
"Nobody here has heard a word from the Jacksons since the show," said Jill Bret, a public affairs officer at the Library of Congress.
Jermaine Jackson, executive producer of the show and president of Jackson Communications Inc., said his family did not waste money from the charity event, but acknowledged that bills are still outstanding.
"All this negative stuff is just being cooked up to take away from the beauty of what took place," the 39-year-old performer said.
"I'm sick and tired of people picking on the Jacksons. This family did not spend hardly any money in Vegas. I didn't make one penny off this show and I mean, really, how much can clothing and limousines cost? I'm doing the best I possibly can. These people will get a check as soon as I get paid."
Regardless of whether the production crew gets paid, the charities--who were promised the show's net proceeds--will receive no more than $100,000 from Jackson Jubilee, a New Jersey-based nonprofit foundation.
As it stands, St. John's Hospital in Santa Monica will receive about $50,000 with another $50,000 to be divided between the Northridge Hospital Medical Center, the Library of Congress, the Friends of Conservation, the Red Cross and the Salvation Army, according to officials of the Studio City-based Permanent Charity Committee of the Entertainment Industry, which could receive as much as $15,000.
Despite the lure of it being Michael Jackson's first formal stage performance since halting his world concert tour, the "Jackson Family Honors" event raised only half the projected $2.2-million ticket gate--even though the price of thousands of mid-level seats were slashed from $350 to $150 after representatives of the pop superstar threatened that he would not appear if the house was not full, sources said.
After the discount failed to stimulate sales, sources said an estimated 3,500 tickets were given to Jackson associates, MGM employees, casino patrons, Nellis Air Force base personnel, charity groups and youth organizations from Las Vegas to Los Angeles at the last minute to fill the arena.
In the fallout, TicketMaster, which handled the sale of tickets for the event, has refused to turn over nearly $500,000 in proceeds after demands for refunds from customers who paid $350 for tickets only to find themselves seated next to people who paid $50 or nothing at all.
The MGM Grand hotel has frozen an additional $400,000 in box office proceeds after encountering similar ticket complaints and also to cover room service charges and labor costs associated with the event.
"When a show doesn't turn out exactly the way it's planned, everybody starts pointing fingers," said real estate attorney Robert Petrallia, chief executive officer of the Iselin, N.J.-based Jackson Communications. "As soon as we have a full accounting of where all the money is, we will pay those whom we owe."
Sources close to the concerts aid the family cannot possibly take in enough money to pay off the $5.7 million accrued in bills. The production was deeply in the hole before a single performer set foot on stage at the MGM Grand Garden Arena.
http://articles.latimes.com/1994-03...-jackson-jubilee-jackson-family-honors-nbc-tv
would have been interested if the producer of this show would have wrote a book about his experience just like the guy who worked on the wales tribute
