Allen Klein: The Man Who Transformed Rock & Roll

by Fred Goodman

  Then, to the shock of Harrison and his attorneys, they received notice just prior to the start of the trial’s penalty phase that the Bright Tunes attorney was being replaced by Alan Kahn, the staff attorney at ABKCO. Klein had purchased Bright Tunes lock, stock, and “He’s So Fine” for $587,000. Suspecting the worst, Harrison’s lawyers had Kahn disqualified, pointing out to the judge that he had been involved in setting the case in motion for Harrison and couldn’t possibly now represent the plaintiff—which was suddenly Allen Klein. Attorney Gideon Cashman, who had initially represented Bright Tunes and then been dismissed by Klein, who believed that he would have no trouble reaching a friendly settlement on his own with Harrison, was hastily called and begged to come back. “Allen so completely misjudged the pulse of Harrison as to be talking about the man in the moon,” Cashman said. If Klein had ever meant to demonstrate his largesse, Harrison clearly wasn’t buying it. With the waters already churned by the simultaneous and rancorous settlement discussions over ABKCO’s management of the Beatles—who were not pleased to discover that it was going to cost them millions of dollars to finally be done with Klein—Harrison had no trouble believing Allen had interfered with George’s chance to settle the plagiarism suit for his own benefit. “The thing that really disappoints me is when you have a relationship with one person and they turn out to betray you,” he said. “He was the one who put out ‘My Sweet Lord’ and collected 20 percent commission on the record. And he was the one who got the lawyers to defend me . . . He, on one hand, was defending me, then he switched sides and continued the lawsuit.” Others, however, wondered if Klein wasn’t simply amusing himself and exacting a bit of revenge. In Seider’s opinion, “that was Allen being mischievous.”

  At first, mischief was its own reward. After looking over the sales of “My Sweet Lord,” the judge determined that its huge success had played a large role in driving the sales of both All Things Must Pass and a subsequent album of Harrison’s hits, and his first assessment was that the song had cleared $2,133,316 for the artist. But after making a few subjective adjustments, the judge reduced the liability to $1,599,987—all of which Harrison would have to pay to Klein as the owner of “He’s So Fine.” Ultimately, however, the judge heard Harrison’s objections and decided that Klein’s fiduciary duty to Harrison continued even after he’d ceased to be his manager and that he wasn’t entitled to profit from his subsequent actions. Under the 1981 ruling, Klein was ordered to hold “He’s So Fine” in trust for Harrison with the proviso that his former client reimburse him the $587,000 it had cost him to buy Bright Tunes.

  Attorney Don Zakarin, who replaced Cashman as ABKCO’s attorney in the case, considered the whole affair—which was unsuccessfully appealed and went on well into the 1990s—extraordinary. He could think of no other case where a songwriter had been found guilty of copyright infringement and ended up owning the song he’d infringed. As the lawyer for the side that won its claim but lost the judgment, he was pleasantly surprised to discover that the man he’d represented had no regrets.

  “Unlike most clients, Allen didn’t point fingers and say, ‘You guys should have done better.’ His reaction was that it was his fault, he made a mistake. And it was not a great situation—it cost him a lot of money to litigate.”

  Harrison, after eighteen years of arguing about it in court, was less sanguine, claiming Klein still owed him “three or four hundred thousand dollars” in earnings on the two songs. “It’s really a joke,” he complained. “It’s a total joke.”

  Harrison and Starr were also unhappy over their settlement of the Beatles’ business with ABKCO. In typical Klein fashion, he’d kept negotiations going, and they’d stretched on until 1977, two years after the Beatles themselves had settled their own partnership agreement with McCartney.

  Ultimately, Klein disavowed any continuing interest in the Beatles’ business or properties, with the sole and notable exception of publishing administration on “My Sweet Lord.” In return, he received a lump payment of approximately five million dollars. The settlement, made in lieu of Klein’s future share of Beatles’ royalties and to cover loans ABKCO made to them, was straightforward. Yet it still left the three ex-Beatles with a sour taste. Sadly, Harrison’s choice of Denis O’Brien to succeed Klein as his business manager would produce bigger problems and greater regrets; in 1995 Harrison filed a twenty-five-million-dollar lawsuit against O’Brien, alleging financial mismanagement and deception. The court awarded him $11.7 million, but O’Brien declared bankruptcy and Harrison never collected.

  Klein’s negotiations with John Lennon and Yoko Ono were just as contentious. On his 1974 album Walls and Bridges, a livid Lennon included a vituperative song about Klein, “Steel and Glass.” The title, seemingly referring to 1700 Broadway, the office building where ABKCO was headquartered, was John at his nastiest; he simultaneously threatened Klein and portrayed him as inconsequential. As a final kick in the balls, Lennon sneered at Klein’s painful childhood, particularly his mother’s death, adding “but you’re gonna wish you wasn’t born at all.”

  That was what Lennon sang in public—yet behind closed doors, he concluded the settlement on a decidedly different note. More than any of the other principals, Ono was the one who hung on through the months-long negotiating process and helped hammer out the details of the final agreement, and Klein later told reporters that the settlement was a result of her “tireless efforts and Kissinger-like negotiating brilliance.” But just as it seemed the deal was concluded, after the two sides had taken suites on the twelfth floor of the Plaza Hotel in New York and were sending their last proposals back and forth at the end of a marathon, five-day session, Klein threw a final wrench in the works.

  “I have one last demand and it’s nonnegotiable,” he told his attorneys. “John has to have dinner with me tonight.”

  Kramer, after weeks of work, saw the settlement collapsing under another one of his uncle’s caprices. “Oh, for God’s sake!” he exploded. “That’s not going to happen!”

  Allen was unmoved. “No dinner, no deal. Just go tell him.”

  Sighing and shaking his head, Michael went down the hall. Knocking on the door of the Beatles’ suite, he took a deep breath and got ready to make a fool of himself.

  He didn’t have the chance.

  “Tell Allen,” Lennon said when he opened the door, “that I want to have dinner with him tonight.”

  In deciding to continue their friendship with Klein, Lennon and Ono may simply have viewed Klein as a fact of life, someone to be reconciled with and dealt with, treated as a friend and an asset instead of an enemy and a liability. But one thing was clear: intense talents and shortcomings—particularly the inability to separate personal and professional desires—ruled both men. In a lifetime of searching for love and validation, the closest Allen Klein had ever come to a soulmate was John Lennon.

  What do you do after you’ve lost the Beatles?

  The road that opened before Klein was not promising. He had the extraordinary distinction of having been the manager of both the Rolling Stones and the Beatles—and the infamy of having been repudiated by both, becoming an object of derision and a symbol of villainy to many of the groups’ fans. It certainly didn’t help when McCartney continued to portray himself as having won a titanic battle to keep Klein from seizing and destroying the Beatles’ work—despite the fact that Klein had never done that. “The choice was: lose everything you’ve ever earned—and with the Beatles that was quite a substantial amount: rights, royalties, monies, assets and everything,” McCartney said years later of his decision to sue for the breakup of the partnership. “Lose all of that, or sue and pray that you win, because if you lose you’ll lose it all anyway.”

  Allen’s continuing legal wrangles with the Stones had become a sport and a pastime. In July of ’74, the Stones and Klein concluded another round of arduous negotiations over royalties, this one resulting in a payment of $375,000 to the Stones and the granting of another album to ABKCO. The s
ubsequent collection, Metamorphosis, was composed largely of oddities, demos, and alternate takes; it was hardly compelling. But at least part of its value to Klein appeared to be that it gave him something to release just as the Stones were starting a new tour, and he got it in stores on the same day as Rolling Stones Records’ package of recent hits, Made in the Shade.

  “Allen liked to futz around with Jagger,” said Cashman, who handled much of Klein’s continuing litigation with the Stones well into the eighties. Some of the motivation was economic, but some of it was personal and ludicrous; at one point, Allen said he was angry with Jagger for making a face at his daughter.

  Nonetheless, Klein was ferocious about guarding the integrity of the Rolling Stones’ back catalog. At a time when late-night television was rife with ads for cheap albums of repackaged hits by established artists offered through schlocky mail-order licensees like K-Tel, ABKCO had no interest in exploiting the Stones’ recordings. Indeed, the only license granted during the period was a greatest-hits package limited to Germany for which the band and ABKCO received two million dollars. ABKCO wouldn’t even license the band’s recordings for multiple-artists collections or for soundtrack albums. Though other performers had rejected similar offers in the past—both the Band and Bob Dylan had declined to license the original recordings of “The Weight” and “It’s Alright Ma (I’m Only Bleeding)” for the Easy Rider soundtrack album in 1969—Klein was one of the few managers who continued to adhere to that standard. In 1983, he granted the producers of The Big Chill the right to use “You Can’t Always Get What You Want” in the film but not on the soundtrack album. If someone wanted a copy of the song for his record collection, he would have to buy Let It Bleed.

  He was similarly tough in his negotiations with record companies. Under distribution contracts with Universal and Sony, ABKCO continues to this day to manufacture records by Sam Cooke, the Rolling Stones, Herman’s Hermits, the Animals, and others. And in striking contrast to industry practices, those companies must pay on receipt—meaning anything they hold in inventory, they’ve already paid for and can’t return to ABKCO. “We’ve got skin in the game with anything from ABKCO,” a Universal executive said. ABKCO’s tight rein on the music maintained top-shelf prices for the Rolling Stones albums.

  It wasn’t just the business of the Stones that kept Klein in court. If he thought there was an advantage to be gained by ABKCO or an associated artist, he was more than willing to take it to court; he relished the opportunity. Klein spent so much time and money in court that his own attorneys would try to talk him out of litigating.

  “I once asked him, ‘Is this really worth it?’” recalled Zakarin. “Allen said, ‘You don’t worry about whether it’s worth it. I worry about whether it’s worth it.’ And it was his decision. But it made you nuts sometimes—he spent a lot of money on litigation.”

  Klein’s biggest legal expenses, however, didn’t come from disputing a contract or suing on behalf of a client. It was from fighting a federal tax case against him. As always, he knew exactly how he wanted to proceed and what he did and didn’t want his attorneys to do. And this time, it would cost nearly all of what remained of his reputation.

  As ABKCO’s head of promotion, Pete Bennett had to get records played on the radio however he could.

  An industry veteran who’d promoted records by Nat “King” Cole before joining ABKCO, Bennett made the industry leap to rock ’n’ roll and pushed whatever record the company was involved with at the moment, whether it was by Herman’s Hermits, Lulu, the Plastic Ono Band, Donovan, or the Rolling Stones. He was entertaining, streetwise, and likable—well suited to that segment of the music business where payola lived on via favors, friendship, and expense accounts, the industry hewing to the letter of the law but not its spirit. His primary job was to curry favor with disk jockeys and program directors, and he relished the role. When Bennett traveled on American tours with the Stones, they clearly got a kick out of him, introducing him as “our Mafia promotion man.”

  “Pete was a character,” said Michael Kramer. “He’d say, ‘Dis reckid is gonna be a monster in Detroit.’ I remember he and his wife, Annette, inviting people from the ABKCO office up to their house for dinner. She sent Pete downstairs to bring up some wine but when he came back up and she saw what he had, she said, ‘Not that! Bring up the good stuff!’ Pete said, ‘Annette! When did you become a cock-a-sure of wine?’ That was Pete Bennett.”

  Emily Barrata Quinn, who was Bennett’s secretary and later an assistant to Klein, wasn’t as amused by Pete. Having worked at New York radio station WABC-FM, Quinn was used to promo men being hustlers of a certain ilk but found Bennett to be “ilkier than the ones I met at WABC. Those promo guys seemed decent,” she said. “After you talked to Pete Bennett, you needed a shower.” She had trouble imagining an easier job than getting a radio station to play a Beatles record. “Being the promotion man for the Beatles—that’s like Chris Rock’s line: Crack sells itself. I was never clear what he actually did.”

  Nonetheless, ABKCO had a potentially rich promotional budget for the Beatles. Klein’s renegotiation of the group’s contract with Capitol Records included the kind of free-goods clause contained in most recording deals: ABKCO received five thousand copies of any single or album to use for “promotional purposes.”* Some were clearly marked as such and couldn’t be confused with salable records; others, known in industry parlance as cleans, were identical to the records sold in stores.

  Historically, cleans had been given to wholesalers and retailers as inducements to buy a title, and they lingered on as a little-discussed part of the business—an old, bad habit that, like smoking, was hard to quit. It was one of the record business’s dirty little secrets that companies sometimes used cleans to create slush funds or gain favor with radio stations and retailers, ostensibly for the ultimate benefit of the artist and his record. But the biggest problem was the recordings’ obvious susceptibility to abuse: cleans were untraceable and valuable, and anyone who had cheap copies of hit records could easily find a buyer. Cleans were cash masquerading as vinyl, and executives sometimes made their own clandestine deals and pocketed the money.

  Despite initially refusing to furnish the items, Capitol ultimately gave ABKCO clean promotional records of the Beatles and their solo projects—including The Concert for Bangladesh, despite the fact that five dollars from each copy sold was meant to go to UNICEF. Thomas Engel, the former assistant U.S. attorney who ultimately prosecuted Klein, recalled that the IRS heard that Bennett had been selling Beatles records to distributors out of the trunk of his car—for cash, at least at first. It became considerably easier to bring a case when agents discovered Bennett had let a Long Island wholesaler pay for the records by writing a check to a nonexistent corporation so the buyer could declare the cost of the clandestine sale a business expense. Engel, who was unsure whether the IRS had always intended to target Klein, said he was eager to trade up. “Bennett was a little guy,” he said, “and Klein was not.”

  Though the IRS sent agents to ABKCO to investigate, Klein wasn’t worried. He was preoccupied with making a film he expected would be his big commercial breakthrough as a producer, an Aristotle Onassis and Jacqueline Kennedy–based roman à clef entitled The Greek Tycoon. Initially, the project had belonged to Klein’s friend Laurence Myers and Nico Mastorakis, a producer of soft-core porn films who had conceived the idea and pitched it to Anthony Quinn. When Klein, in search of projects to make in partnership with the respected American producer Ely Landau, learned Quinn had committed to playing Onassis and that the female lead was Jacqueline Bisset, he was eager to be involved. Myers, his affection for Klein notwithstanding, knew what that meant: Allen would take over his project and he’d be reduced to an associate producer. Myers politely declined. But after spending seventy-five thousand pounds he didn’t have on a shipping-tycoon-size yacht party at Cannes that successfully drummed up interest among American studios, Myers had no money for a screenplay or a director. K
lein bailed him out, and he and Landau became the producers.

  With filming in Greece, England, and the United States, Klein reveled in the role, whether he was taking private jets around Europe and the Mediterranean, overseeing the production, or playing chess on the set with Quinn. When they needed a Rolls-Royce for a scene, Klein didn’t want to rent one and instead insisted on using the white Rolls he’d bought from John Lennon and kept in London. He had his English driver, Alf Weaver, bring it to Greece.* Klein might have enjoyed his role as producer, but he was also taking a substantial risk: he had guaranteed the film’s seven-million-dollar budget—almost certainly more money than he really had—without the backing of a studio. Eventually a deal was made with Universal, one that reserved control over the film’s final cut for Klein.