A moving image
A moving image
Big secret, little city
Steven Spielberg, Michael Ovitz, and PCA [Portland Cable Access] defend litigation. Now, city control over PCA, a State of Oregon Non-Proifit, leaves arms length, good faith negotiations and The First Amendment in question.
A moving image
Big secret, little city
Steven Spielberg, Michael Ovitz,and
PCA [Portland Cable Access] defend
litigation. Now, city control over PCA,
a State of Oregon Non-Proifit, leaves
arms length, good faith negotiations
and The First Amendment in question.
By Rod Pitman
Portland, Oregon 12/8/01
MARTIN LUTHER KING'S DREAM WORKS
December 2, 2001, 60 minutes, the premier CBS News program, ran a segment on the Martin Luther King family's decision to license Dr. King's "I have a dream" speech for a t.v. commercial. The way "the dream" works, Rev. King's image is saved digitally, then using editing technology the audience is erased.
While watching the t.v. show, I was taken back eighteen months to a visit with "part-time celebrity," Chris Van Dyke, the ex-District Attorney of Salem, Oregon. At the time, Chris was working for Nike in Hong Kong, home for the holidays, and our conversation touched on his work overseas. Little known film industry history is that Dick Van Dyke, Chris' father has a passionate hobby known to film buffs as animation in lightwave. Without getting too technical, this was a process first used in MARY POPPINS. A YELLOW screen lit with sulfur lights created the first-ever composite effects. It was tricky to say the least.
Most people in the entertainment business are familiar with the term "blue screen," but the "green screens" are in heavy use as well. Petro Vlahos won an Oscar for inventing "blue screen technology". The actual Oscar was for "Color Traveling Matte Composite Cinematography." No mention of the any particular color was part of the award. "Bluescreen" has become the industry jargon that refers to the idea, not a color. Doing the same thing optically with film is very different than doing it electronically or digitally with video. Dick Van Dyke's, MARY POPPINS, used "yellow screen" which, more than likely, was the birth of the technology at the heart of the Spielberg, Ovitz, Portland Cable Access law suit.
"SITUS" TRAGEDY OR DARK COMEDY
PCA [Portland Cable Access] is a state of Oregon Non-Profit organization created two decades ago to fulfill our government's commitment to provide a public audio visual forum which was not available through commercial broadcast systems. PCA uses the three prong PEG [public, education, and government] approach to access. The leading prong is the public's first amendment right to free speech served through the "town square video soapbox" known as Portland's public access channel. Anyone willing to complete PCA's training courses can put a show on this channel. Partnerships with education, such as PCA's video production classes doubling as course study for Portland State University provides the "E," or education side of cable access. City Council meetings and other municipal programming is the G, or government channel City Net 30. Funding for our "domestic voice of democracy" is paid for through a nominal charge on the cable t.v. subscriber bill.
Former PCA producer, Jay L. Rappoport, filed a lawsuit claiming he developed the technique of "combining historical footage" with "new product advertising" at PCA, and that PCA staff inappropriately leaked the privileged information for his process to Hollywood.
The suit was filed in the UNITED STATES DISTRICT COURT OF NEW JERSEY, Civil Action No. 97-5742 (AJL) and oral arguments followed.
THREE CAN KEEP A SECRET IF TWO ARE DEAD
Here is the list of defendants in the Rappoport case, Portland Cable Access being the "situs," or in layman's terms, the location where the supposed transgression took place;
Steven Spielberg, Amblin Entertainment, Michael Ovitz, Creative Artist Agency, Industrial Light and Magic, MCA/Universal, Jeffery Montgomery, Harvey Entertainment, Warner Brothers, Time-Warner, Turner Pictures, Turner Broadcasting System, Hanna Barbera, David Kirschner, Maurice Hunt, Telecommunications Inc., News Corporation, Twentieth Century Fox, Pizza Hut, Inc., Nabisco Foods, Texaco, Dowbrands, Tropicana, Kellogg USA, Washington Post Company, Paramount Communications, Paramount Pictures, Coca-Cola, Corporation for Public Broadcasting, Channel 13 (New York City), Big Feats Entertainment, CBS Corp., CBS Entertainment Productions, Andrew Hill, The City of Portland, Oregon, Portland Cable Access, Debbie Luppold, Melinda McCrossen, Phyllis Coe, Ellery Nelson, Elaine Weinberg, Preston Foster, George Slanina and Sandy St. John.
When I was a child, my father had some "business" dealings with Carlos Marcello. Mr. Marcello owned a motel in New Orleans, Louisiana. Other than the Attorney General Robert F. Kennedy dropping Carlos by helicopter on a mountain top in South America, then telling him to have "a nice walk home", Mr. Marcello's greatest claim to fame is the urban legend that he "contracted" the JFK assassination.
One day dad went to visit the infamous New Orleans' motel owner. While sitting in his wood paneled office, there was a notice framed on the wall. It said, "Three can keep a
secret if two are dead."
TWO ARE DEAD
As in the production process of the "I have a dream" commercial, the public participation in the little Rappoport drama was erased and replaced with hard earned, post tax dollars for you, the public's representation in the case. With the number of defendants alone, local and otherwise, have you, or anyone you know, ever even heard of this case? No?
The reason may be simple. It was just not news worthy. You know, just a little nuisance suit filed in New Jersey by a guy who represented himself in U.S. District Court while living with his mother. Everything was probably kept under wraps so that important confidential information didn't leak out and jeopardize the case strategy. It seems perfectly reasonable to me, imagine the things you don't hear about, probably happens all the time.
However, litigation with such a high profile list of names, forget the volume of defendants, casually slipping through the media cracks in this small town? Would that be luck? If so who's? We, the individual citizen's who paid for this madness have a better chance of winning power ball.
Maybe there's no conspiracy, no black helicopters, but you do need to look at the screen from a different angle in order to see what lies beneath. The story is not about Stephen Spielberg, Coca-cola, or even the suit itself. The real issue starts with; Why is this amount of money being spent on such a frivolous endeavor? Apparently this was a dark adventure, with no one who actually paid for it knowing what it was about? From everything I've been able to gather, most of the lawyers involved had no idea what was going on either.
FOLLOW THE MONEY
When the case was filed several years ago, the PCA board didn't realize the scope of then PCA Executive Director, Robert Skelton's, hidden agendas. There had been a number of hard questions asked about the budget, then Skelton was called on the carpet by the board for what he referred to as having "his ears pinned back". Skelton has since fled the organization under allegations of mismanagement, but it appears Skelton, with the help of others, may have "steered" the lawsuit from one law firm to another in an effort to cover up fraudulent acts.
This also created a good opportunity to prep the new lawyers for Skelton's upcoming employee contract negotiations. After all, he was more than influential in positioning their firm with nice expensive legal work, more of which he would attempt to influence peddle their way, whether they were actually qualified to do the work or not.
As the money meter ran, the PCA board kept trying to figure out why the case was being handled so expensively.
Former board member and Clarke College professor,Stuart Kaplan, had this to say at the time; "Does the suit we are responding to really justify spending nearly $10,000? I may be very naive in these matters but the odds of the other party prevailing seem so low to me in this case, that I question whether we should be spending so much money. What about our insurance?"
Kaplan, was very concerned that PCA was pouring money down the drain on a nuisance lawsuit. The cost quickly ballooned to $28,000. Other board members, Sharon Genasci, Joella Werlin, and Omar Halverson, a retired attorney, felt that the dollars being spent were very high, while our risk of exposure was very low.
As cost spiraled upward Kohel Haver, a lawyer and PCA Board President had this to say; "PCA spent $70,000 defending an exterior law suit, not from a staff personnel matter. You know, this is why I won't be famous. This will go away for petty cash, but when a lunatic sues us and Spielberg, it cost 70,000 to make it go away. That's a heroic effort? Reagan invades Grenada - Hero - they name airports after him. Is wisdom and diplomacy the game of wimps? Arrrg."
PCA CONTINUES TO GIVE AS THE CITY TAKES
The matter was made more complicated because the City of Portland tendered it's defense through an indemnification clause that had been a matter of contention at PCA's and the City's last contract negotiation. Board members felt that the city had "arm-wrestled" indemnification provisions into PCA's contract that put the organization at an unreasonable risk of bankruptcy.
Over the years the city had positioned itself to "squeeze" the Oregon non-profit, and this created continual problems for PCA's to properly defend itself in litigation, as well as hobbling the board's efforts to perform their fiduciary duty to the organization. It also put the board in an unfair advantage of having to negotiate for it's franchise revenues back from the city under duress. There have also been questions raised concerning city contractual requirements jeopardizing the organizations tax-exempt status, and why PCA is the only access center who's franchise fees go directly to the city, instead of directly to the access center which is the norm. PCA is the only access center under the "oversight" of the MHCRC that does not receive it's payments directly from the cable company. This combined with the city council appointing board members, as opposed to the board being made up from the "membership," or the public cable subscribers who are putting the money in, leaves a lot of room for conflict of interest.
In the Rappoport case, PCA's legal council from Stoel Rives had this to say about the city's tender of defense; "Because the city is being sued for its own negligence and because of the effort required for the city to prove that we are liable to Rappoport and it is not as a precondition to indemnity, I don't think PCA will be accepting this tender."
Well, that was when they no longer became our council in that case. Whatever the city's correct position in the case should have been, quickly became a mute point with the change of law firms. Supposedly the move was based, at least partially, on saving money. As the legal fees ballooned, the board was unaware that a number of possible defenses existed that would have expedited a cost efficient financial closure to the litigation.
Although it's easy to play Tuesday morning quarterback, the Rappoport case may have been easily disposed of if it had not been for Skelton's destruction of documents combined with omissions of evidence he kept under wraps. It was this destruction of evidence and the contents of the evidence itself that has cost the city and PCA much more than the price of the Rappoport lawsuit. When all legal bills are added up the cost moves into six figures.
The "evidence" that was destroyed hinged on the issue of the PCA employee handbook. A legally sanctioned, board approved employee handbook had been in place prior to Skelton's being hired at PCA. A pattern of changes in organizational documents began with Skelton's hiring process when "someone" changed Skelton's job description in order for him to qualify for the job.
Although not impossible, it would have been hard for Skelton to do this alone without anyone on the search committee finding out. Then, as Skelton's luck would have it, the full board was removed from the search process making it easy to pass Skelton off as a viable prospect. Who would really notice the job description had been changed for the Exhibit "A," attachment to his contract? This had been tampered with by removing the board mandated, major employment and educational qualifications, as well as the full scope of duties that would be necessary for Skelton to do his job properly.
A mystery book could be written about circumstances of false statement and claims surrounding Skelton's hiring, but once the Mount Hood Cable Regulatory Commission [MHCRC], city cable office and the PCA board sanctioned his position of power, Skelton started his tenure by having Gregory Franklyn, a PCA employee, destroy a number of "producer files" one of which was Jay L. Rappoport's. I know this is somewhat tedious, but do try and stay with me.
This was just part of a process where Skelton was on a mission to purge the organization of it's history. Whoever tampered with Skelton's employment requirements, as well as Skelton, had a number of reasons that internal as well as "public documents" should never come to light.
In addition to shredding documents, taping over board minutes audio tapes, and erasing computer hard drives, Skelton was busy creating perks for his job that didn't even have the "tacit approval" of the board.
Basically the organization was being gutted. After Skelton ordered Franklyn to destroy the Rappoport file with other documents, he was quoted as saying, "the history of the organization starts now."
THE EMPLOYEE HANDBOOK DEFENSE
If the case had focused in on certain issues relative to PCA's defense to Rappoport's claims, such as the employee handbook, the public may have been saved about $100,000 on that case alone, then there is more money in other areas, as well as the peoples lives and reputations that have been compromised surrounding PCA, MHCRC and the city cable office' conflicts of interest.
Here's what ex-PCA employee and Rappoport defendant Melinda McCrossen had to say at the time;
"The Rappoport file was well documented when I left PCA three years ago. Since these charges are from so long ago, I don't know if it still exists, but you will find a wealth of information about him [Rappoport]. If I were defending PCA I would most certainly want to see this file."
McCrossen continues; "Also, as a minor point, I might add that public access producers are prohibited from direct financial gain as a result of producing a product using PCA facilities and equipment. If at any point Rappoport claims financial loss as a result of producing this program, he would be in direct violation of PCA's base operating rule of no profit. He and everyone who came through PCA were made aware of this fact in orientation and throughout our training process."
McCrossen suggested Skelton use the file and the non-profit defense outlined in all real and subsequent counterfeit versions of the employee handbook.
There are a number of questions surrounding the PCA handbook and the fact it may have been altered without the board's knowledge or consent. Some of the issues raised by the "handbook defense" might have required a closer look at the way the organization is run.
The organization tried for years to get Skelton to provide them with a proper, legally sanctioned board approved handbook. The board also asked for a proper budget process with baselines by departments, board sanctioned job descriptions, and a proper organizational as well as fiscal flow chart. All to no avail. When board members requested information on Warner Brothers and Michael Ovitz correspondence sent in reference to the Rappoport case, Skelton informed the board "Warner and Ovitz materials are not at our reach."
There now seems to be a number of reasons why several people within organizations that do business with PCA did not want the non-profit under a magnifying glass. This includes fraudulent augmentation of pay scales, as well as the forwarding of hidden agendas that were not in the best interest of PCA or the public who are still footing the bill.
Combine the public money spent on the Rappoport case, then add $65,000 of PCA's principle and interest compromised and co-opted by the MHCRC's bungled over builder fiasco to the new $300,000 discrimination lawsuit just filed a few days ago, and you are easily looking at close to half a million dollars, either lost or at risk or being vaporized.
In an odd, disfunctional twist, a major focus of the new $300K discrimination case focuses on the destruction of the same legally sanctioned, board approved handbook. I know, it's an adult dose.
IMPROPER CONTROL BREEDS CHAOS
The cable office's control over PCA could not be more evident than when David Olson, city cable office director, went from city commissioner to city commissioner's office to have then board President, Grant Remington, and board Treasurer, Jim Faulkner, removed from office. Remington and Faulkner claimed they were exercising their fiduciary duty to the organization in an effort to handle an employee problem. Others felt the officers were inappropriately micro managing the organization, and that it was the city's job to be judge, jury and executioner.
With that kind of sword hanging over your head, how can you act in the best interest of the PCA without clearing it with the city council first? Maybe it does not make sense to force an Oregon non-profit to require political appointments in it's by-laws?
Two of the players involved in the board removal debacle were Ex-PCA managing director Debbie Luppold and ex-PCA employee Melinda McCrossen. Both Luppold and McCrossen are listed as co-defendants in the Rappoport case. No one that I know of has been able to find any public documentation as to why Remington and Faulkner were removed as board members, the records appear to have been "lost."
In a PCA board meeting Skelton admitted he had destroyed three years of board meeting audio tapes. He claimed he was taping over them to save money on cassette tapes. There are now questions concerning possible Civil Rights violations that may have been on those tapes. As investigations moves forward, the security of remaining tapes are also under scrutiny. It will be interesting to see what, if any of those board tapes are still available and still useable as evidence. Basically, the fidelity of the organization's history has been and continues to be systematically gutted. After Skelton fled the organization, the master tapes for the whole PCA intranet were missing. They contained valuable company history and documentation and are now presumed stolen.
LIKE A TROPICAL STORM
On the island of Kaui, Skelton was "salted" into his access Executive Director position by the cable company. Once in place, he attempted to turn the Kauai access center into a PR outlet for his friends. His less than supportive views of the first amendment were common knowledge on the island of Kauai, throughout the state of Hawaii, and the national access community as well. He was even taken to task for lying to a Hawaii state senate subcommittee about his access center's board corporate philosophy.
Why would the PCA executive "search committee" bring Skelton to Portland? Per PCA board minutes, Sue Deciple, now the Mount Hood Cable Regulatory Commission Board Chair, who at the time was "assisting" the search committee, was opposed to full board participation in Skelton's interview process because she was "concerned about the possibility of the Board second-guessing the Committee.'"
The move to narrow participation in the hiring process may have been very costly to the city. In addition to all of this, Sue Deciple was a "consultant" in a relatively small industry where everyone knows the politics and the players. That's why she was later hired by the Honolulu access center to try and facilitate answers to the same problems Skelton was creating in Portland. Oddly enough, it was the Honolulu access center that Skelton modeled his vision of Portland Cable Access after. It was a disaster in Honolulu, Skelton's model was a disaster on Kauai, and now the storm turned quickly and was guided straight for PCA.
If you give Sue Deciple the benefit of the doubt, first for what she knew, then what she may not have, or should have known, her decision to restrict the full board from questioning the decision of the search committee may have kept Skelton out of the running. The fact that the first incarnation of the search committee had rejected Skelton out of hand for not meeting board qualifications would more than likely have come to light. Even Skelton's boss at the cable company had applied for the job at PCA. He was rejected as unqualified for the job. Skelton would latter threaten the board by saying he would go to work for the cable company or a competing over builder if the board continued to insist he do his job and meet his fiduciary duty to the organization.
In the end, the board was instructed to ask no questions and do as they were told. They promptly, and probably for the most part unknowingly, rubber stamped the committee's recommendation. See a pattern?
It's really hard to blame the full board at this point. All this was coming on the heels of the city removing the former Board President and Treasurer for performing what they thought was their fiduciary duty to the organization. After their removal, the message was clear. If you want to stay on this board, you do as you are told. Don't ask questions or you might find your character assassinated and your professional reputation within the community in shambles as well. From the standpoint of intimidation and decision making under duress, it's as good as having two bodies hanging in the square. When it came to the city, PCA was consistently offered what it could never refuse. Portland Cable Access had been fully co-opted and compromised.
ENRON'S CUMULATION OF EVIDENCE
Economic analyst are saying the Enron case had a lack of "material evidence" but finally the "cumulation" became overwhelming. By then it was too late. Hopefully it's not too late for the Portland city budget or PCA. Here the MHCRC, and the city cable office knew and or should have known there was a cumulation of evidence. Material evidence. It spans from the jeopardizing of Portland Cable Access' tax exempt status, to bribery, commercial bribery, illegal gratuity, conflict of interest, false statements and false claims, extortion, breach of fiduciary duty, employee double dipping, failure to report a federal felony to appropriate U.S. Law Enforcement Authorities, insurance fraud, payroll fraud, possible conspiracy, mail and wire fraud.
When PCA's board of directors became concerned about the Executive Director's inability to answer questions about operations, a "review" of the E.D. began to turn up what appeared to be fraud within and around the organization. Some board members were stunned as the MHCRC looked the other way and reneged on their promise to provide help and guidance in what was then an "investigation" of the Executive Director.
ASK ME NO QUESTIONS AND I WILL TELL YOU NO LIES
Under Skelton you have five new financial controllers in five years, four of which left under suspicious circumstances. You have board Treasurers who were either asking the E.D. hard questions, or fled in in the wake of fiscal improprieties. The last controller fled all the way out of the country, but may come back to testify about false statements and claims made by the former E.D. to a BOLI [Bureau of Labor and Industry] investigator which has now lead to a new $300,000 lawsuit.
Then there's the false statements and claims that the ex-E.D. made to a Portland judge resulting in the subjugation of our legal system. It appears there is also payroll fraud and possibly insurance fraud still continuing to go on at PCA as the MHCRC and city cable office staff look the other way.
There is even what could only best be described as a fraudulent fraud investigation, the mission seems to be tampering with the fidelity of whatever evidence is left in order to make it harder to get to the real numbers.
There is one thing about the list of defendants in the Rappoport case that is puzzling. Rappoport was so thorough, yet he left the Mount Hood Cable Regulatory Commission off the list? After all, they are the people who are responsible for the "oversight" of PCA. Maybe the answer to that question is the solution to what's wrong with a structure that undermines the democratic process?
Ernie Bonner was PCA board president during part of the Rappoport case. Ernie quit his volunteer position as a PCA board member tired and frustrated. The last line of Ernie's resignation letter came from "deep throat's" character in the film JFK, Ernie said; "Follow the money."
I am now just beginning to understand what Ernie meant by that. Why is our city budget mucked up through improper oversight of the Mount Hood Cable Regulatory Commission? Why is Portland Cable Access suffering at the hands of the city cable office and the oversight of the MHCRC?
Currently the city is losing 1.6 million a month on the "open access" issue, meanwhile the city council eyes Portland Cable Access' 1.3 million dollar a year revenue stream. Sue Deciple brought city auditors into PCA the other day to tour the facility. Maybe the hidden agenda has been pushed up a bit with the economic reality of 911, but the "right sizing" of PCA under the guise of facing economic reality is only an excuse to cover up what is a continuing pattern of negligence and fiscal mismanagement. The only solution the city can come up with to keep down the tide of red ink, is to find areas that are doing well, then rob Peter to pay Paul.
It's no secret, but now it's going to take more than a blue screen or Mary Poppins to change this channel.
Rod Pitman is former Vice President
Board of Directors of Portland Cable
Access. He also co-founded and
served as Vice President of Eagle
Cable Systems, now part of Viacom.
c Rod Pitman 2001
phone: 503 920-8881
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