Another came in early April 1973, though this shock initially seemed to be a path toward safety. Stax was living large with its $6 million bride. Clive and Al were making it work. Wattstax: The Living Word—not a 45-RPM single, not a simple album, but a double album with all those increased profits—sold five hundred thousand copies within weeks of its release. A follow-up double album was in the works. Production and distribution are in the throes of romance. Now Stax’s old-time used-to-be, Union Planters National Bank, wanted some loving too. The previous month, UP received Stax’s payoff for a $1.75 million loan it had taken from the bank half a year earlier. Business as usual, UP issued Stax a new line of credit, a cool 1973 three million bucks. This time, because the record company was encumbered by its six million dollar Columbia obligation, Union Planters extended the money to the East/Memphis publishing company, Stax’s cash cow. On the tenth of April, East/Memphis extended its hand and took half of that line of credit at once, a million and a half. Despite the scrutiny they were under, Stax wrote a check for one million dollars on that same day to Johnny Baylor—despite the scrutiny he was under. Bump. Two more checks were written to Baylor over the coming summer of ’73; all told, beginning with the money found at the airport, he received more than $2.7 million over nine months.
Two million dollars doesn’t just walk out of the room. It swaggers. “It’s Johnny’s,” Al declares. “He could take it because it was his.” However, in comparison, the annual salary for Al was $90,000, with the next highest being Ed Pollack, at less than half that. Other artists were selling in quantities similar to Luther Ingram, and their payments were not as high. Stax’s finance officer later explained to investigators that Baylor was paid royalties on the basis of gross number of records shipped to distributors, not net number sold, and at an extraordinary royalty rate. “It was ridiculous,” Jim says. “I told Bell, ‘You can’t afford to pay that.’”
Whizzz goes Johnnie Taylor as he releases “I Believe in You (You Believe in Me)” in May, going to the top of the R&B charts and to number eleven on the pop charts, selling in five easy months five hundred thousand copies to earn a gold record. Whizzz go the Staple Singers, following their first chart hit of the year with their second before the year’s half done. The Soul Children, Veda Brown, and Stax stalwart William Bell all released charting records before the second half of the year. Whoosh is the sound of three loans totaling nearly $900,000, dating back less than eighteen months, being paid off by Stax to Union Planters.
But then there’s the crash of the wheel coming off. On May 29, 1973, Clive Davis at Columbia Records, Al Bell’s visionary partner, was escorted to the building’s front door and unceremoniously dumped on the street. Fired. And then sued—for misuse of nearly $100,000 from company funds. The problem arose when Clive’s director of artist relations, David Wynshaw, fell in with unsavory characters (mob associates) to perpetrate unsavory acts (heroin distribution); investigating Wynshaw’s work with Clive, CBS learned it had unwittingly paid Clive’s personal expenses: $54,000 to redecorate his Manhattan apartment, $20,000 for his son’s bar mitzvah, and $13,000 to rent a summer house in Beverly Hills. On the stand, Clive’s underling sang, revealing the company’s secret annual budget of a quarter million dollars cash for radio “promotion,” and he connected it directly to Stax and to Philadelphia International Records, Columbia’s two African-American label partners. The IRS tore into Columbia, and the US Attorney’s Office in Newark, New Jersey, instigated its national Project Sound investigation of payola, focusing on Philadelphia, Brooklyn, Los Angeles, and Memphis, seeking evidence of both financial payoffs and also gifts of cocaine and other drugs. (In addition to the US Attorney’s Office, the Wynshaw case triggered two other national investigations: the Newark federal grand jury’s payola probe and the Department of Justice’s Newark Strike Force’s organized crime study.)
Logan Westbrooks was watching this unraveling from the inside of Columbia. “Unfortunately for Al Bell and for Stax Records, the way the deal was cut, it was almost a personal thing between Al Bell and Clive Davis,” Westbrooks explains. “They both had a dream. And they bought into each other’s dream, and they knew exactly how they could make it work. But when Clive Davis was taken out of the picture, no one else at CBS had that vision of that dream. So consequently, Al Bell was just out there—drifting.”
“It was not a deal that was enormously profitable for Columbia,” says Al. “They made pennies and we were making dollars. I’m sure that was not too palatable from a corporate standpoint.”
“For Columbia,” says Westbrooks, “it’s just a matter of business. The Stax deal became the responsibility of an executive named Jim Tyrell, vice president of sales. And Jim was strictly by the book. Black or white didn’t make any difference, whatever the rule says, this is what Jim’s going to do. [Jim Tyrell was African-American.] And that’s the way he played it.”
Al and Clive had never worked out the nuts and bolts. “When the new guys came in,” says Al, “they looked and said, ‘What is this?’”
A fundamental disagreement between the two corporations involved the deep pool of money used for co-op advertising. Co-op funds are a standard practice in advertising; retailers advertise particular brands and then recoup some or all of those costs from the brand. Columbia, for example, would underwrite a record chain’s newspaper ads that featured Columbia product. Al understood that a hefty sum was available from Columbia’s pool for the promotion of Stax product, and since Stax was overseeing its own marketing, he wanted that Columbia co-op money to administer. Jim Tyrell, on the other hand, had no intention of draining that money pool to Stax, and because he found the Stax deal too unusual, he set about bringing the relationship in line with the corporation’s standard practice. The partners, thus, were at odds.
Further complicating the relationship was the existing stock in stores. Stax was handing over to Columbia a mom-and-pop market fully stocked, and expecting Columbia to open up the rack jobbers’ market. But situating the new product line into its existing routine was going to take Columbia some time, under even the best of circumstances; and these circumstances were adverse. Stax, undeterred, continued manufacturing.
Three weeks after Clive Davis was fired, Memphis newspapers began reporting on various federal probes, criminal and civil, aimed at Stax. In an article entitled “Stax Probe Began After Cash Seized,” the evening newspaper disclosed that Johnny Baylor “maintains an eighth-floor suite at the Holiday Inn-Central at 1837 Union, [and] also is said to occupy when in New York, a plush Stax apartment at 45 E. 89th St. [a block from Central Park, between Madison and Park Avenues]. Further, records in the Shelby County Register’s Office show that on May 7 [1973] Stax transferred the deed to a $26,000 house at 872 W. Shelby Drive to [Dino] Woodard. The deed [was] signed by Alvertis Isbell (Al Bell), executive vice president of Stax.” The flow of money was unusual, and there were no contracts that justified it. “It’s just like the tip of the iceberg right now,” said one attorney, “and it seems the iceberg is on the rise.”
The waters were certainly troubled. Two years had passed since the Jaspan firm’s undercover investigation that resulted in the firing of two Stax employees for piracy, Roussell and Kole. Now a judge was asking, Why would Stax settle such a large claim for ten cents on the dollar? Then another iceberg, a headline reading: STAX IS ACCUSED OF COVERING UP IN PAYOLA CASE. Why would seven Stax executives claim Fifth Amendment privileges when questioned by the IRS? The grand jury subpoena requested an explanation of all “the major activities of Stax, including the percentage of profit derived from each such activity, the structure of the company . . . and all performers, promoters or producers under contract to or presently in contract negotiations with the company.” The Feds—both judge and grand jury—were bearing down.
Icebergs notwithstanding, the Titanic of Stax, Isaac Hayes, continued on his course. In the spring he released another double LP (his third in a row), this one, Live at the Sahara Tahoe, quickly earning gol
d status for a million dollars in sales. It was support for Jim’s notion: Sell what you know. Isaac had recorded away from Stax, out of Johnny Baylor’s way, so it was reassuring when he returned to the Stax studio that summer. (He consented to booking his time around another Memphis artist who’d rented the facility, Elvis Presley.)
A new style of music was developing, creeping into the public’s consciousness as it spread from New York dance clubs: disco. The music employed new technologies—early drum machines and synthesizers—but it was also shaped by Isaac’s catalog, by his stretched-out grooves and repeated rhythms. In late 1973, Isaac released Joy, a single album of all original material that caught a new groove, blending some of the aggressive sounds of his movie work with his rich and mellow album sound. The songs still ran long—five on the album instead of ten, none shorter than six minutes, one longer than sixteen—and he continued to favor big productions with strings and intense arrangements. But he’d noticeably shifted his feel, riding atop the beat this time, a dance edge instead of all bedroom, all the time. The title track nicely loses itself to the rhythm, a dance trance, auguring the new style. In a matter of weeks, Joy was certified gold. Isaac was next coproducing, starring in, and scoring a new movie, and had made sure its soundtrack would be released on Stax. He was featured on the cover of Ebony in October 1973:
Isaac Hayes in performance. (University of Memphis Libraries/Special Collections)
Today he owns a Mercedes, two Jaguars, three chauffeur-driven limousines and a $26,000 sea blue, gold-plated Cadillac Eldorado he bought to put “pimpmobiles” out of business. Today he owns a townhouse in Washington D.C., a bungalow in Memphis, and a sprawling hilltop mansion in Los Angeles. “The money, the cars, all of it is just fringe, but Isaac Hayes is roots,” he told Ebony. Under the auspices of Hot Buttered Soul, Ltd., he has hired more than 60 people—counting his agent, accountants, lawyers, business advisor, public relations personnel, bodyguards, gym and health coach, dancers, musicians, background singers, secretaries, valet, stage technicians and chauffeurs. “It takes a lot of patience to make yourself sit down and listen to some guy talk a lot of dull figures that are foreign to you. Absolute Greek. But you gotta keep in mind that it means economic power and a sound stable future. And it means that you’re a link in that big chain so necessary for black progress and unity in this country. In short, it means taking care of your own.”
Like Stax, Isaac carried a heavy payroll and many obligations. But if his success was supporting Stax, Stax’s success could support him. Their relationship was symbiotic. The sales for Joy were good for everyone. He was the leading artist in a very strong roster. Chart hits kept coming from the Emotions, the Temprees, the Dramatics, the Soul Children; from longtime label artists Eddie Floyd, William Bell, Johnnie Taylor, the Staple Singers, and Albert King; and from newer signings Little Milton and Inez Foxx. There was additional growth in light of the Columbia deal. STAX EXPANDS WITH POP, C&W, GOSPEL RECORDS, announced a January 1974 newspaper story that boasted of not only new talent but also new staff to run the new pop-oriented departments. At 1973’s end, Stax was ranked number five among black-owned and black-managed businesses, with sales estimated at $20 million. More artists! More employees! More ways to win!
As Al had envisioned, recordings were just a portion of the new Stax Organization’s activities. STAX ANNOUNCES PLANS TO PRODUCE 4 MOVIES declared a February 1974 headline. The following month, news came that they were about to become the first black-owned company to own a pro sports franchise, with the intended purchase of Memphis’s ABA basketball team.
Stax bought a church and its adjoining school facility just off Poplar Avenue, the city’s main thoroughfare, as a new home for its corporate headquarters. “Banks were basically bricks-and-mortar oriented,” Al explains. “They didn’t understand the value of the masters and understood a little about the publishing. My charge as a businessperson was to start building a balance sheet that showed bricks and mortar.” Union Planters funded the purchase; though they recognized there was not presently collateral, it was agreed that the upcoming renewal of Stax’s foreign distribution deal with Polydor would produce more than enough money to accommodate the payoff.
“We got this church, and the school building with it,” says Deanie Parker. “And tried to departmentalize. We really were bursting at the seams. I hadn’t moved my publicity department to the Avalon offices, but I moved to the church—not wanting to go, but understanding that it was essential for us to become the Stax Organization.”
Finally, in April 1974, Stax made good on the implied promise of the Wattstax movie, releasing Richard Pryor’s first nationally available album, That Nigger’s Crazy. The movie had primed audiences for this brash comic’s talent, and the album lived up to the promise. The title, however, scared Columbia too much to touch it; Al created the Partee label and distributed it through the independent ties Stax had maintained with Respect, Gospel Truth, and other labels not under the Columbia deal. The reception was immediate, and warm, and Stax watched its new star, another album seller, on the rise.
With all this activity, the McLemore studio, though just a few miles away, was sometimes a distant thought. And so perhaps it’s not surprising how little reaction there was to Packy Axton’s death in January 1974, a death foretold by the creases across his puffy face, by an old man’s phlegmy laugh earned—hard-earned—well before its time. Packy was dead of cirrhosis at just thirty-two. Who on McLemore was left to mourn? His mom had left five years back, his uncle had sold out, his peers had dispersed.
“They used to call Packy ‘the Spirit of Memphis,’” says Johnny Keyes, and he laughs with the memory. “Some would say, ‘That name’s already taken.’ But no, this—Packy—is the spirit of Memphis.”
On September 20, 1973, a few months before Packy died and a few months after her five-year ban from recording concluded, Estelle established Fretone Records (named for her children’s last names, FREderick, and AxTON, the final “E” making it more musical). Estelle had money, and she says, “I had to prove to myself that I had sense enough to produce a hit record, to prove that a woman could do it too.” She also needed to occupy Packy; he’d returned to Memphis from several years in California. Estelle bought a small house in an African-American neighborhood, established a studio in the basement, and put offices on the main floor. An important factor in the location was its proximity to her husband’s favorite watering hole. After a quarter century in their one-thousand-square-foot house, she’d convinced Everett to move to the apartment complex she’d bought with her Stax money. It was several miles due north, but he still drank from his favorite bar stool at Berretta’s Famous BBQ. “Mother would drop him off at Berretta’s in the morning, go to Fretone and work all day, then go home around three fifteen and get him,” says Doris. “By then he’d had enough. One beer every thirty minutes. If Mother couldn’t pick him up, I would, and I’d send my daughter Amy in. ‘Hey Granddad,’ she’d say softly. He was extremely mellow but always on his feet.”
“Packy used to say, ‘Everett’s going to die first,’” says Johnny, “‘and by the time I get sick, medical science will fix it so I can have a new stomach.’”
Estelle’s Fretone was another homegrown affair. She made Packy chief engineer, another opportunity for him to prove the mettle she knew he had. Johnny Keyes was staff writer, engineer, and promotions man. Daughter Doris ran the front office. “We’d stay at Fretone all night,” says Johnny. “It was ideal. I had the lyrics and some of the melody and he’d play his guitar. We’d put it together and he’d write the changes out. He always had a Tupperware cup. I’d say, ‘Packy, why are you drinking that rotgut?’ ‘Hey, man, don’t talk about my whiskey.’”
“Mother was off and running again,” says Doris. “She spent all her money chasing that hit. I was trying to keep order in that place that had no order. It was an insane den of iniquity. Dark rooms, dirty old place, my kids running around—Amy was four or five, Adam [Doris’s son], and Chuck [Pa
cky’s child that Estelle had been raising]. Amy’s first memories of pot were over there. That’s when I told Mother I was going back to being a wife and mother.” The time at Fretone allowed Doris to relate to Packy as an adult. Yet “I never could get Packy to open up to me until the day before he died. He said, ‘I was scared to go to the doctor, don’t let that happen to you.’ And he said, ‘I want another chance.’ But they couldn’t get him well.”
“Packy was sicker than he let on,” says Johnny Keyes. “His body was slender, but his stomach grew, and we used to tease him about that. One particular night, I was in an office, writing, and Packy knocked, said, ‘I’m going home, I don’t feel well.’ Next thing we know, he was at the hospital. His inside was tearing. It was his liver. I gave blood and I’d go see him, but he didn’t have much to say.”
Packy’s condition startled his friends, though it was not unexpected. “You went to school with this guy since the fifth grade and you watch him turn into an old man in just a few years,” says Don Nix. “I mean, thirty-two years old! It’s tough to think about, but it was tough to watch. He was so full of life as a teenager, and he just became a shell. His mama got this doctor down from New York, got Packy through Christmas.”
“Then one day I went up there, and he was his old self,” says Johnny Keyes. “He said, ‘I’ll tell you what.’ He said, ‘I’m not drinking anymore. That’s it.’ And he said, ‘You can have my Volkswagen Beetle while I’m in here.’ He said Jim was by, and they had a good talk, made up and everything. He said, ‘I guess I’ll be getting out of here pretty soon.’ His complexion was better, not blotched like it was before. I said, ‘You had me worried there, boy.’ And the next night, that was it, he was gone.”
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