Q. As a talent agency, CAA represents many of the top stars. Now you have agreed to advise Credit Lyonnais, the French bank that effectively controls MGM. Isn't it a blatant conflict of interest to advise a studio while representing movie stars, directors and writers who seek work at studios?
A. I'm not advising MGM. I'm advising a bank that holds a major stake in MGM, that has loaned $3.1 billion to various entertainment companies and wants to rethink its entertainment investment strategy.
Q. Why?
A. I didn't call them. Credit Lyonnais called us. They want to learn more about films, television and music. CAA represents many of the top people in those fields.
Q. Jeff Berg, who runs International Creative Management, your principal competitor, says it is not legal for you to receive compensation from MGM or any other studio while representing talent.
A. Everything about it is perfectly legal. I will be meeting with the guilds representing writers, actors and directors, and I will tell them everything about this consulting agreement to address any concerns they may have. Do you think if I had a blatant conflict I would be holding that meeting?
Q. Then why is Berg so adamant in attacking your deal with the bank?
A. This is a very competitive business.
Q. You mean he wants to make your clients nervous so that they'll go to ICM?
A. No comment.
, Q. But how can you separate your responsibility to represent a client's interests from your responsibility to advise a company that may employ your client?
A. Look, this industry invented conflicts of interest. In what other business would you have a lawyer who represents the chairman of a major film studio and also represents an important actor be the guy who makes the deal between the actor and the studio chief? Hollywood is a small, familial place. Everyone does business with everybody else. The same complications occur in investment banking. But just as they build a Chinese wall to separate the parts of their companies that have competing or conflicting interests, we have built a Chinese wall at CAA. It's all about ethics and how you do business.
Q. You helped Sony buy Columbia Pictures in 1989. You helped Matsushita buy MCA/Universal in 1990. People accused you of dabbling in investment banking to satisfy your ego.
A. Nonsense. We got paid very well for our help, and both of those studios are stronger as a result. That means my clients will have more good places to bring their projects. Look, all of the big studio companies are deep in debt except for Disney. I have helped to bring more new capital into the entertainment business than anyone else in recent memory. It's all about expanding markets for my clients.
Q. Your company also helped create Coca-Cola's new advertising campaign. You are consulting with Nike and advising computer firms on possible entertainment products. Are you bored with being a talent agent?
A. That is absolutely wrong. I spend 85% of my time handling the needs of my clients. And every single move we've made has been tied directly to our clients. My job is to help my clients understand how the landscape of our business is changing so that they can create great new kinds of entertainment.
Q. How so?