The Man Who Made the Movies

by Vanda Krefft

  No, Sinclair decided after hearing Fox out, he couldn’t do it. He was working on a novel and didn’t want to set it aside. Sinclair’s wife, Mary, intervened. Fox had offered $25,000 (equivalent to about $448,000 in 2017), and the couple badly needed the money. Two months earlier, having mortgaged their home to help finance Sergei Eisenstein’s on-location movie about Mexican culture, Que Viva Mexico!, they had ordered the director to shut down filming because they were convinced he was lollygagging to avoid returning to Russia. Since then, the Sinclairs had been entangled with Eisenstein in a tug-of-war over the rights to the existing footage. By the time Fox showed up, they had little hope of seeing a return on their investment soon—if ever. Taking her husband aside, Mary reminded him of all the bother he usually went through to set up a book, yet here was a multimillionaire with “a story already made.” She told Fox, “Upton will write your book for you.”

  Their sessions spanned about six weeks during the spring of 1932. Three times a week, Fox, dressed in a light-blue or brown jacket, white sweater, and white or striped flannel trousers, arrived by limousine from Santa Barbara at around 10:00 a.m. For three or four hours at a time, they sequestered themselves in Sinclair’s study. Fox sat in a walnut rocking chair drinking lemonade or orange juice or water and smoking a cigar, while Sinclair occupied another rocker about ten feet away. Nearby was Reass, whom Sinclair described as “a funny little old gentleman” who behaved “just like an errand boy.”

  They were really more like a therapist and a patient than an interviewer and a subject. While Sinclair provided prompts and studied his subject’s responses, Fox talked and talked and talked. He talked so much and so quickly that Sinclair had to hire two stenographers to work on alternate days to keep up with the transcription.

  Sometimes Fox got up and paced the room so forcefully that Sinclair had to rearrange the furniture to make sure he wouldn’t knock anything over. Fox clenched his hands. His voice trembled. When Reass tried to interrupt, Fox steamrolled over him.

  Out poured a storm of tormented emotions, conflicting thoughts, and, often, words that didn’t make sense except for the strength of feeling behind them.

  Fox was, Sinclair thought, a haunted, brooding, “tired and stricken man.”

  Over and over, Fox hammered away at the same theme, smashing it into pieces and trying to put them back together. He never could make them fit precisely, partly because some pieces—facts—were missing, and partly because his rage made it impossible to see clearly. He knew this for certain, though: he had been targeted by a tremendous financial conspiracy. He had been hunted, persecuted, caught in a “spider’s web.”

  He could never decide who exactly had headed the conspiracy. Sometimes he blamed AT&T for wanting his Tri-Ergon sound-on-film patents to monopolize the motion picture industry. When he followed that line of thought, he didn’t know where to stop, depicting the phone company as a diabolical organization intent on brainwashing the American public. Noting that AT&T had started to manufacture educational movies, he speculated that children might “be taught to salute a telephone pole or a telephone receiver when they saw one. Or, maybe (and who can tell) due to intensive training, the children would automatically salute the ringing of a telephone bell.” Fox seemed to be serious rather than joking. In other moods, he blamed the banking industry, especially the Chase Bank, for trying to steal the Fox companies’ wealth by organizing an unscrupulous financial industry blockade against him.

  He sounded paranoid, except there was so much he didn’t know, and experience had shown him that it wasn’t safe not to suspect the worst about others’ motives and methods. He had lost his empire that way. He had trusted the wrong people. If only he had been paranoid before. Pressed by Sinclair to peer into dark corners—areas where he had to admit, “I have no way of knowing” and “I do not know” and “I don’t know”—he could only project his wounded, bleeding emotions.

  He lashed out not only at his main adversaries and their “shyster lawyers,” but also at anyone who had stood on the sidelines and refused to help. Adolph Zukor “was part and party to the destruction of my companies” because he wanted Paramount to regain its position as the world’s largest movie studio, Fox claimed. He had no evidence. The Chase Bank’s stockholders should have taken legal action to restrain Wiggin and his gang from going after the Fox companies because no provision in the bank’s charter permitted such activity. “These stockholders knew of it. Many of them knew of it.”

  He now thought that Winfield Sheehan might well have played an active part in arranging the 1912 murder of gambler Herman Rosenthal, although previously he always refused to consider the allegation. He called Reginald McKenna, head of the London Midland Bank, which had compounded Fox’s crisis by calling his loans on the Gaumont stock purchase, a “pig” and “a sow.” He mocked Charles Evans Hughes, who in late 1929 had made those empty promises to carry Fox’s burden for him, as “this great Chief Justice of the U.S. Supreme Court.” He had so much anger there weren’t enough targets to absorb it.

  He felt sorry for himself. “I was not quarreling with pikers. These were the giants. Just imagine these tremendous giants all battling with one poor little man!”

  He blamed himself. He should have known. He should have made many different decisions.

  If only he hadn’t bought the Loew’s and Gaumont stock. That had been the start of all the trouble.

  If only he hadn’t trusted “Wild Bill” Donovan, the assistant U.S. attorney general who had told him the government would have no objection to the Loew’s and Gaumont acquisitions. Then he wouldn’t have made the purchases and incurred the crushing $93 million debt.

  If only he hadn’t trusted Harley Clarke. Harry Stuart had told him not to.

  If only he hadn’t entered the December 1929 voting trust with Harry Stuart and John Otterson.

  If only he had allowed himself more than two hours’ sleep a night during those five weeks after the stock market crash.

  If only he hadn’t agreed to have Charles Evans Hughes’s firm represent the voting trust instead of himself individually. He had let go of the best legal mind in the country.

  The fact that many of his decisions, especially the Loew’s stock purchase, made sense at the time, that most of the country’s supposed financial experts hadn’t seen the stock market crash coming until it was too late, and that in normal times the consequences of his mistakes would not have been so devastating—none of that mattered. All that mattered was that if he had acted differently, he would not have lost everything.

  “You would not think a person could be so stupid,” he said. “I don’t deserve any sympathy.”

  He almost wished he had died in the July 1929 car accident, because then he wouldn’t have had to endure any of this misery. But that wouldn’t have been any good, either, because then the burden of subsequent events would have fallen on someone else, and believing as he did in a spiritual afterlife, “I am sure that I would have received message after message of the terrible mess I had made.”

  He tried to hold on to some self-respect and a positive place in history. William Fox had been great. That was a point that needed to be understood. He didn’t want to come across as “a conceited ass” or “be considered a fool or be disliked for saying it,” he told Sinclair, but he really believed that William Fox “was the creator of all things in the moving picture industry.” Starting with his fight against censorship in New York City and his heroic one-man challenge to the monopolistic Motion Picture Patents Company, he had loved the industry, “had fought for it and bled for it . . . and all the others had to do was to imitate.” That was going to sound egotistical, he knew it. Still, he—the self-created William Fox persona—“really believes he was the leader of the moving picture industry and with the removal of him, the whole structure crumbled.”

  He loved the movies so much he couldn’t see how they could survive without him.

  He wanted to come back. No, he didn’t. It would be tortur
e.

  The more he talked, the more he submerged himself in grief. People who thought he was lucky or smart to have gotten out with $18 million didn’t understand. Fox Film and Fox Theatres were “the children of my brain” and there was no adequate compensation for their loss, “no sum of money that they could have given me that would again make my mind contented or bring me the happiness that I was enjoying during the many years that I was creating and constructing these two organizations.” He hadn’t expected to stay forever, just to the point where he felt that his job was done and that the time had come to let someone else carry on. He had never reached that point.

  Why had it happened? He could still visualize the room at the Ambassador Hotel where, two years before, he had made the deal to sell his voting shares to Harley Clarke. “The doorway was about here. The window there. The desk there.” Maybe if he returned there in memory he could see more clearly. He couldn’t accept that human relations had to be reduced to such squalid terms as had occurred in that room. “There must be something more in common with men than the dirty dollar. I can’t believe that that is all there is in this world and that men have no moral obligation to each other.”

  Once he broke down completely. He was telling Sinclair about how, after spending two months after the market crash in Manhattan hiding his business troubles from Eva, he had returned to Fox Hall for their thirtieth wedding anniversary on December 31, 1929, and, not realizing how ill she was, had argued with her, and peevishly returned to Manhattan the next day. At the memory of her worn-down appearance and his obliviousness to her suffering, he began sobbing. According to Sinclair, he “had to walk up and down for a long time to get himself together.”

  In the end, Fox was just as confused as when he began talking to Sinclair. He came to understand only that he had lost his shining city on a hill. He wanted little more than not to have to keep remembering. As he told Sinclair in a concluding session, “I have been a very unhappy man for two years. I probably am going to continue to be unhappy on this subject for the rest of my natural life. But I believe part of the pangs of the pain is going to be removed when I have made a record of my experiences. I would relieve myself of the things that annoy and torture me . . . I want to try to forget this thing.”

  By mid-May 1932, Fox was on the train back to Fox Hall with Eva, Mona, and Belle. He was exhausted. As he later wrote to Sinclair, “the thirty days I spent with you, while I enjoyed it thoroughly, was [sic] amongst the thirty hardest days of my career.”

  No respite awaited in New York. To drum up some advance interest in the book, Sinclair had written to Sen. James Couzens (R-MI), a member of the Senate Banking and Currency Committee, which had recently started examining stock market practices, with an emphasis on short selling. Although Fox had sneered at the investigation, calling it “the most amusing and laughable thing that I have ever read about . . . It’s looking [into] the stable after the horse has run away,” he agreed to let Sinclair offer him as a witness on the subject of short selling.

  He even looked forward to meetings set for early June 1932 in New York with the Senate committee’s associate counsel, William A. Gray. A Philadelphia criminal defense lawyer whose clients included gangsters, prostitutes, brothel owners, bootleggers, and crooked politicians, Gray had been chosen for the Senate committee job because of his reputation for “bullyragging” witnesses—browbeating and bulldozing them. Nonetheless, Fox expected to be treated as a friendly informant. He was “delighted,” he told Gray, to have a chance to tell his story to the American public. He soon changed his mind. Evidently out to snare a trophy villain, Gray ambushed Fox with “heaps and heaps of questions” that went far beyond the agreed-upon scope, hostile questions about Fox’s stock market trading and his income tax returns.

  Fox turned truculent, often refusing to answer. Still, although the subpoena issued by Gray had just expired, Fox went to Washington intending to testify before the Senate committee on June 16, 1932. He wanted to tell his story. En route by car the night before, he either had second thoughts or became physically ill—or had second thoughts that made him physically ill. After checking into the Mayflower Hotel at about 3:00 a.m., he didn’t leave for five days, alleging dizziness and abdominal pain. Gray accused him of faking, but Fox sent over the hotel doctor, who told the senators that the mental and emotional strain of testifying would aggravate Fox’s diabetes severely.

  Indeed, Fox would have been in for it. Gray tore him apart in absentia, and the senators themselves seemed hostile, questioning Fox’s legitimacy as an American. Sen. Frederic C. Walcott (R-CT) asked, “What is his origin? Where does he come from? What is his nationality?” A moment later, Sen. James J. Couzens (R-MI), Sinclair’s supposed friendly liaison, chimed in, “Is that the first name he has had?”

  After several days, they all ran out of steam on the subject of William Fox and proceeded to other targets. On June 20, 1932, Fox quietly checked out of his hotel and went home.

  No sooner had that storm abated than a squall of lawsuits pummeled him. Foremost were those of the Fox companies themselves, these “children of my brain.” On June 21, 1932, Fox Theatres sued Fox for $5 million, and nine days later, Fox Film sued him for $10–$15 million. Both companies blamed their downfall on Fox’s mismanagement and malfeasance, sidestepping two notable facts: the companies had been at the height of their prosperity when Fox relinquished them in April 1930, and subsequently, Harley Clarke and the Chase Bank had battered them with more than two years of birdbrained decisions. However, the Fox companies were desperate. Two days after suing Fox, Fox Theatres went into receivership, with debts of $6 million and current assets of only about $200,000. Fox Film was nearly comatose from lack of cash, unable to attract or keep talent except for a precious few loyalists and unable to figure out how to produce movies that made a profit.

  The lawsuits were, Fox believed, “blackjack suits,” a street thug’s whack across the back of the neck while hands reached for his wallet.

  A month later, a major creditor pounded on his door. On July 30, 1932, the Chicago Title and Trust, which had filed the receivership petition against Fox Theatres several weeks before, sued Fox for $1 million in connection with the Roxy Theatre in New York. When Fox bought the Roxy Theatre in March 1927 from Herbert Lubin, he gave a $1 million personal guarantee that Fox Theatres would make all the required payments. However, on March 24, 1932, Fox Theatres had defaulted on the final $410,190 installment payment, after also not meeting the previous two obligations. The Chicago Title and Trust had acquired the Roxy payment rights from the ex-wife and the business associate to whom Lubin had assigned them.

  Fox refused to pay. He had several good reasons, he thought. First, the April 1930 voting shares sale explicitly indemnified him from all liability in connection with any lawsuit arising from the Fox companies’ subsequent conduct. Second, he believed that the Roxy had been deliberately mismanaged in order to force foreclosure (wiping out all the Roxy stockholders) so the theater could be sold cheaply to either the Fox company or a dummy fronting for it. He also suspected that Fox Theatres and Chase Bank officers had deliberately not made the last three payments because they knew he would be held liable.

  Even a member of his family took legal action against him. On June 30, 1932, the same day that Fox Film sued him, sister-in-law Alice Fox filed a lawsuit asking for $250,000 to support her and her two children by Fox’s black sheep younger brother, Aaron. After Fox’s dethronement, Aaron had lost his $250-a-week job at Fox Film, and another job that Fox got him lasted only three months. Aaron fell into stock market debt and, according to Alice, conducted a “barrage of shocking and repulsive intimacies with women of the gutter” and repeatedly threatened to kill her. After their separation in 1931, she claimed, she and the children had received “not one solitary cent of support” from Aaron and were now destitute.

  Alice’s case against Fox was based on the fact that since January 7, 1932, Aaron had been ensconced in the Hartford Retreat in Hartford,
Connecticut, a mental institution that was really more like a country club, with its uniformed doorman, expensive furnishings, and history of sheltering wealthy miscreants. Alice claimed that Fox, who was paying the bill, had stashed Aaron there both because he was jealous that Aaron had recently formed the Aaron Fox Film Corporation and also to prevent Aaron from testifying in the Senate investigation of the stock market crash. On the grounds that he had removed Aaron as a source of support for his family, Alice demanded that Fox assume financial responsibility.

  Although her lawsuit vilified him as “unprincipled” and “despotic,” Fox helped Alice. He gave her $1,480 in September 1932 and, starting the following month, paid $60 a week to fulfill Aaron’s court-ordered alimony obligation. In November 1932, Alice withdrew her lawsuit.

  Under all the pressure, Fox’s personality splintered. He became meaner to strangers. Deranged by grief, he tried literally to make his July 17, 1929, car accident, which he viewed as the first pivotal event leading to his downfall, pay for what it had done to him. At the time, he hadn’t wanted any restitution from Dorothy Kane, the driver of the Chrysler that had T-boned his chauffeur-driven Rolls-Royce, lobbing it into the air and smashing it down on its side in a ditch. He had considered the collision entirely an accident. As of June 1932, however, he was suing Dorothy and Muriel Kane for $206,000, alleging negligence.