Oscar-winning 'Crash' producer is flat broke

Cathy Schulman

LOS ANGELES - It's been a bumpy ride. Accepting the fifth best picture Oscar ever awarded to a woman, independent producer Cathy Schulman landed on the stage of Hollywood's Kodak Theater this week along with writer-director Paul Haggis as one of the credited producers of "Crash."

But while Schulman, 40, has a lot for which to be grateful, including a supportive husband of 12 years and a 5-year-old daughter, she can't entirely savor her win. She still faces a court fight against producer Bob Yari, who is furious that he was deprived of the chance for his own moment onstage because of rulings by the Producers Guild of America and the Academy of Motion Picture Arts and Sciences. And at what should be a career pinnacle, Schulman finds herself flat broke. "I have the interesting distinction of having made five movies in a row without ever being paid," she says. "I can't pay my bills."

As a girl, she always was driven to succeed. After her adored father, who taught laser surgery at Yale, died in a car accident when she was 18, Schulman studied playwriting at Yale. But after she mounted several plays in New York, a friend suggested that she find a job in the movie business to pay the rent.

After two years assisting producers Earl Mack and Michael Taylor on such films as Kathryn Bigelow's "Blue Steel," Schulman moved to Los Angeles to work for Barbara Boyle, co-founder of the innovative co-financing company Sovereign Pictures. In four years, Schulman moved from assistant to production executive as she helped to assemble such international co-productions as "My Left Foot" and "Cinema Paradiso."

She next spent three happy years as co-director of programming at the Sundance Film Festival, helping to shine a spotlight on such rookie directors as David O. Russell, Robert Rodriguez, Paul Thomas Anderson, Lee Tamahori and Bryan Singer. In an industry where most production executives learn how to read scripts, watching so many finished movies was "great training," she says.

Sundance board member Tom Rothman brought Schulman, who wanted to make movies instead of just select them, over to specialty distributor the Samuel Goldwyn Co., where she was involved in acquisitions and production on such films as "The Madness of King George," "The Perez Family" and "Much Ado About Nothing." Schulman even discovered young Australian actor Russell Crowe in "The Sum of Us." "We only worked on movies under US$12 million," she says. "I got a sweet spot for making manageable movies in that range."

Joining the short-lived Savoy Entertainment, Schulman got a crash course in film production on the fly. There, she met head of physical production Betsy Danbury, who later became her right arm on "Crash." After Savoy CEO Victor Kaufman pink-slipped most of his staff, he sent Schulman out to sell the remaining slate in a fire sale. "I got to meet the heads of the studios," she says. Paramount Pictures chairman Sherry Lansing bought "A Simple Plan." New Line Cinema bought "American History X."

Universal Studios president Ron Meyer put Schulman together with on-lot producers Michael Lobell and Andrew Bergman, and she learned about studio-level producing on the ill-fated Demi Moore movie "Striptease" and "Isn't She Great," starring Bette Midler as Jacqueline Susann. "We had fabulously fancy-schmancy offices at Universal," Schulman recalls. "I learned how to make big-budget movies, but they were not the kind of movies I was interested in."

Around 1998, Schulman and managers Rick and Julie Yorn started to fantasize about starting a production management company. So when former CAA chief Michael Ovitz recruited the Yorns to join his new Artists Management Group, they introduced him to Schulman. He turned on the famous Ovitz charm. "I'll never forget it. We had that classic meeting at his house with all the artwork, the servant with water on a silver tray with a doily over it," she recalls.

As president of Ovitz's Artists Picture Group, Schulman was making US$600,000 a year, putting together a slate of low-budget movies like Edward Burns' "Sidewalks of New York." But by summer 2000, Ovitz's AMG was starting to crumble. APG had a deal with French company Canal Plus that came under the supervision of Universal after Universal's merger with Vivendi. Suddenly, Schulman's projects met a closed door, with Universal refusing to greenlight them, she says.

In frustration, Schulman that December arranged private meetings with Meyer and CAA agent Bryan Lourd to see if she could resolve the impasse. Somehow, Ovitz discovered her meetings. "I was trying to maintain my ethical compass and do what was right," Schulman says. "But in pursuit of what was right for the group, I fell into a trap." (Schulman has been deposed in the ongoing case involving private detective Anthony Pellicano and allegations that he wiretapped and otherwise probed the backgrounds of prominent entertainment industry figures.)

Called into an audit interview by Vivendi, Schulman says she was counseled by her lawyer to tell the truth. She answered questions about how much time and money she spent on about 50 projects, unwittingly revealing details of APG's accounting on the Canal Plus deal.

According to her 2002 wrongful termination lawsuit against Ovitz, "When Ovitz learned of Ms. Schulman's truthful disclosures . . . in a rage, he immediately terminated Ms. Schulman." She lost the suit and was ordered to pay US$3.6 million to Ovitz during arbitration, but the award was vacated in 2004.

In the film community, while many respect Schulman's taste and acumen as a producer, some question her business judgment when it comes to the men with whom she works. "Cathy's emotionality makes her a good producer on-set," says one producer, "but gets her into trouble in business."

Schulman admits that she has been "saddened and angered" by the time spent fighting those legal battles. Amid the Ovitz litigation, she filed for bankruptcy. "I bring the same total commitment and passion to movie projects and to managing my process," she says. "It's my greatest strength and weakness. It's the same thing that made me fight tireless battles to get 'Crash' to the screen without pay. I don't suffer wrongdoing well. I right wrongs with legal battles. I want to pave the way for people who follow me not to let this happen."

While searching for equity investors interested in low-cost, high-quality movies, Schulman brought Yari in as an investor in Bull's Eye Entertainment, which she founded with her partner Tom Nunan, a former television executive at UPN. Yari brought her the script for "Crash" and asked if she wanted to make it. She loved it and, with Haggis, lured a top-flight cast.

On the five films Schulman made with Yari, he paid for her overhead, found international investors, invested some of his own money and controlled the purse strings. He asked Schulman to defer her producing fees on the projects, which included the Sundance films "Employee of the Month" and "Thumbsucker." That left her in the financial lurch on more than one occasion, including her stint in Prague shooting the US$17 million "The Illusionist." When she got back and found that "Crash" was a runaway success, she thought she might start seeing some money. According to the complaint Schulman and Nunan filed against Yari last month, she has not been paid for any of the work she did for him. Yari has called the lawsuit "a shameful misrepresentation of the facts" regarding the Bull's Eye partnership.

"Twice, I've built companies for powerful men who've gotten pissed off . . . and sued me," Schulman says. "In defending myself, I'm considered litigious, like I'm the problem."

Now separated from Yari, Bull's Eye has several upcoming TV series, including CBS' "Crash" and "Angela's Eyes" at Lifetime as well as some pictures in development at Focus Features, DreamWorks and Fox Searchlight. Director Ed Zwick is developing its fantasy epic "The Lions of Al-Rassan" at Warner Bros. Pictures. Schulman is trying to put together a financing company with silent investors.

In the end, Schulman sees her "battle wounds as badges of honor," saying: "It's been a hard battle to succeed in this crazy career as a female indie producer. It was the greatest reward to end up with an Academy Award. 'Crash' is amongst 78 other movies that are considered American classics. I feel proud that this amazing exploration of fear made people feel something about the lives they are living, all over the world."

- REUTERS/Hollywood Reporter