Leading Lady: Sherry Lansing and the Making of a Hollywood Groundbreaker

by Stephen Galloway

“It was a great love story, with an underlying message about female empowerment,” she said. “Rose [Kate Winslet] was strong and feisty from the beginning—she’s an independent woman who breaks with her class to be with the man she loves [Leonardo DiCaprio] and even lets him paint her nude. One of my favorite moments was when you see Rose at the end and realize she’s had this huge life and has become a force in her own right. People underestimated the strength of those characters and how unconventional they were.”

  She was eager to make the film, but there was no obvious way to get involved. She knew Cameron was locked into a deal with Fox, and nothing led her to believe he was thinking of switching studios. Then word began to spread about the picture’s cost. Stories rumbled through Hollywood that the price was too steep, that Fox executives were sweating bullets. Soon Lansing learned that the studio was in talks to co-finance the movie with Universal.

  Universal was an obvious partner, having joined Fox to release True Lies. But Lansing knew it was contending with a slew of troubles, including the fallout from Kevin Costner’s 1995 drama Waterworld, an ocean-based action film that became a byword for profligacy.

  Waterworld had started out with a budget of $100 million, which had gone up and up until the movie came in at an astronomical $175 million. Costner had almost died along the way when he got caught in a squall; even then, he was shooting six days a week, and the stress showed in his performance. Wags dubbed the movie Fishtar and Kevin’s Gate, playing off two other celebrated disasters, 1987’s Ishtar and 1980’s Heaven’s Gate. The idea of backing another sea-based epic was inconceivable to Universal’s top executives.

  “[Universal’s] Casey Silver couldn’t run away fast enough,” said Fox’s Bill Mechanic. “Everybody thought the movie was nuts.”

  When Lansing heard Universal was wavering, she pounced. “I said, ‘We have to win this. We have to get in there before anyone else,’ ” she recalled. Calling her executives together, she launched a coordinated assault and arranged for them to bombard Fox with calls, reminding its production staff about the great experiences the two studios had shared on Braveheart.

  Mechanic did not see things quite the same way. A down-to-earth former distribution executive, he was still angry with Paramount for failing to do the paperwork that would have allowed Fox to share the Best Picture Oscar, and believed the neglect had been deliberate.

  “They were all calling, saying, ‘We had such a good thing on Braveheart,’ ” he noted. “And I’m like, ‘Well, there were some issues.’ ”

  Mechanic would have liked to finance Titanic on his own. He believed in it, was invested in it and clung to his conviction that it would be a hit, no matter what others might say. But there were pressures. As Fox’s second-ranking executive, he reported to Peter Chernin, the head of the studio, and Chernin reported to Rupert Murdoch, the head of News Corp. The higher up the ladder the decision-making went, the more anxious everyone seemed. There were bosses to please, shareholders to keep happy, and all these executives were wise to the ways of Hollywood, knew only too well how easily their careers could be toppled by a single ill-advised decision. Mechanic increasingly seemed like a voice crying in the wilderness.

  Chernin had loftier goals. He was soon to be promoted, and the last thing he wanted was a stain on his record as studio chief. He was desperate to do a deal.

  “I told Peter that finding a partner was his problem, I had a movie to make,” said Cameron, “so I just proceeded hell-bent toward production, and Fox continued to fund the film while they scrambled to find a partner.”

  Unable to get an answer from Universal, Chernin insisted that Mechanic consider Paramount’s offer before it was too late. Fox told Paramount it would have five days to close the deal, and if it could not be completed within that timeframe, Fox would be free to look elsewhere.

  Lansing sent Bernstein, her chief of business affairs, to negotiate, and for much of the following week he went back and forth over the intricacies of the arrangement. At the end of five straight days of talks—at precisely 2:00 a.m., technically two hours past Fox’s deadline—he concluded his work.

  The two sides agreed to split the film’s $109 million budget right down the middle, with Paramount releasing the film in North America and Fox handling the rest of the world. All the revenue would be shared equally between them.

  “The contracts were faxed back and forth and hastily signed,” said Lansing. “The deal was done.”

  —

  Then trouble began. When Lansing was given a detailed budget and pored over it with Bernstein and her head of physical production, Fred Gallo, she saw one red flag after another.

  “I hadn’t produced such an elaborate movie, but I knew it was light by millions of dollars,” she said. “Fox had only allowed around $25 million or $30 million for special effects, most of which would be spent during the shoot, which meant there’d only be a few million dollars left for the computerized work. And it was going to take a lot more than that.”

  She had gone through this with Forrest Gump and knew how easily that number could balloon. Concerned, she sent Gallo to Baja, Mexico, where Cameron had built a gigantic water tank and multilevel sets on a twenty-four-acre piece of land and was well into making his picture. He had already shot part of the movie in Nova Scotia, Canada, and was preparing to film the ship itself, when Gallo arrived.

  He found an operation bigger than anything he had ever seen. Some ten thousand tons of dynamite had been used to blow a hole large enough to build the tank, and fifteen hundred construction workers were hammering away at the vessel itself, which was almost as large as the original ship. But even this brief visit revealed all sorts of things that could go wrong.

  “Cameron wanted real wallpaper and things like that,” said Gallo. “I said, ‘Why don’t you build the sets and have them paint on the wallpaper? No one will ever know in a million years.’ He wanted a special submarine, and there was only one in the world. It was Russian and he had to have it. They bring it in, and on the first day they have it they have power problems and can’t shoot.”

  When he reported back to Lansing, she grew more concerned.

  “In the climactic sequence, the ballroom was going to be completely flooded, which meant there’d be no way to do any reshoots unless they rebuilt the whole thing,” she said, “and that would cost millions of dollars. But there was no provision for any reshoots in the budget, and that was just one of the problems. Tilting the ship was also complicated, and likely to be very costly. But precisely how costly, nobody could say.”

  Anxiety turned to anger as the Paramount team suspected it had been deceived. Why had Fox not told them about this? Why had they shown Paramount a budget with such gaping holes? Dolgen called Chernin. The two were friends and former colleagues, having worked together at Fox before Dolgen came to Paramount, but that did not mitigate his rage.

  “He said, ‘Your budget’s running way over! You knew this! We’re going to sue you for fraud!’ ” recalled Mechanic.

  Dolgen said Paramount would only stick to the deal if Fox guaranteed that the budget had been “properly vetted and validated.” This was legalese for accepting full responsibility, effectively meaning Fox would have to pay for any cost overruns.

  Chernin refused. But he was under immense pressure, having been named president of News Corp. in October 1996, and the last thing he needed was a runaway picture whose entire expense rested on his shoulders. So he offered new terms.

  Instead of a straight fifty-fifty split, he allowed Paramount to “cap” its investment: it would pay a set amount for half the film, and Fox would cover the rest, including overages. “We’d never have to pay a dime more,” Lansing explained, “no matter how over budget the movie went.”

  In exchange, Chernin asked Paramount to up its investment. Assuming the picture would never cost more than $130 million, Paramount agreed to pay half of that far-out number, or $65 million.

  That deal has gone down as one of the most rem
arkable in motion picture history, and an embarrassment for Fox, given that Titanic’s budget would soar to $210 million, less than one-third of it paid for by Paramount. (Fox later benefited from having a slightly larger share of the profits.) It was a triumph for the Lansing-Dolgen regime. As it was, neither party ever imagined how much the movie would eventually take in.

  “Jon must have run ten different scenarios to show how much we could make or lose,” said Lansing. “We did them until we were blue in the face, but nobody had ever heard of a movie making $2 billion.”

  —

  As the Mexico shoot commenced, Lansing was able to relax, confident in the knowledge that she was off the hook for whatever went wrong.

  But as weekly cost reports came in, indicating that the budget was careening out of control, the Fox leadership was in a frenzy. Mechanic and Chernin were furious at the thought that Paramount had gotten away scot-free, while their own relationship was deteriorating as Mechanic felt he was being blamed and Chernin had moved out of the line of fire.

  “This proved later to be an enormous source of animosity between the studios,” said Cameron.

  Nor did the tension ease when Redstone bragged about the deal. “Sumner does a big thing in the press about ‘my genius Jon Dolgen, my genius Sherry Lansing,’ and ‘Fox is going to eat it,’ ” said Goldwyn, “because he was competitive with Murdoch. Peter felt diminished. He was being played as a financial wimp. He was very unhappy.”

  Chernin and the other executives feared Titanic would become a disaster along the lines of Fox’s own Cleopatra or the more recent Heaven’s Gate, a western directed by Oscar winner Michael Cimino that had almost bankrupted United Artists in the early 1980s.

  “Everyone thought they were going to lose money, and all efforts were simply to make sure the hemorrhage was not fatal,” said Cameron. “Nobody was playing for the upside, myself included.”

  Not even Lansing was sure she had a hit until she traveled to Mexico early in the shoot and watched Cameron and DiCaprio in action. Initially she had feared the actor might be too young, remembering him from such movies as 1993’s What’s Eating Gilbert Grape and 1996’s Romeo + Juliet. She realized she was wrong.

  “They were doing a sequence in the tank, and Leo was soaking wet and gorgeous,” she said. “He was really into the role, and that was all that mattered to him. I don’t think he ever cared about being a sex symbol or a movie star, though this picture made him one. He cared about the quality of the work, which was stunning.”

  Cameron, whose fights with Fox (along with his crew) became epic, greeted her with unexpected enthusiasm before leading her on a tour of his massive set. She remained one of the few executives toward whom he harbored warm feelings.

  “He said, ‘Oh, I’m so glad you’re here,’ ” recalled Lansing. “He’d been asking me to come down and wanted to show me what he was doing. I walked through the ship, and I was taken back in time. They’d recreated everything, and the specificity of the details, right down to the period dishes, blew my mind. He was really excited, showing me: ‘Look at these plates. These are exactly like the plates on the real Titanic.’ He was so dedicated to what he was doing that nothing else existed.”

  Even as she and Mechanic were thrilled with the dailies (Cameron was sending batches of footage back to Los Angeles at the end of each week), the pressure was growing—especially on Mechanic.

  “Peter was hiding his head in the sand,” he said. “We were losing three out of every five days. We had no estimate of cost to date; we had no estimate of when it would finish or what it would cost to finish at all.”

  Production delays grew even worse as the building of the ship took far longer than anticipated. Then, during the shoot, Winslet chipped a bone in her elbow and fought with Cameron, while three stuntmen suffered broken bones. The film’s director of photography was replaced; several cast members got the flu; and almost everyone cowered at the sight of Cameron, terrified of his temper.

  Mechanic was so concerned that he drove down to Baja, armed with a list of proposed cuts. There he confronted Cameron in the middle of the night.

  “Jim exploded,” he said. “It was three or four o’clock in the morning, and if he’d had a gun in his trailer he would have shot me. The gist of it was, ‘If you’re so fucking smart, you direct the picture.’ And he walked off. He stormed out of his trailer, pulled his chauffeur out of the car, and sped off. He was screaming. I said, ‘Shut down the shoot until he calls me,’ and got in my car and drove back to L.A.”

  “It was one of those meetings at night, in the middle of a 150-day shoot, where people just didn’t see eye to eye,” said producer Jon Landau.

  Cameron and Mechanic reached a tentative peace and filming resumed. The director even offered to give up his profit participation—meaning that he would receive nothing in the event of success—which both Fox and Paramount accepted. (His profits would later be restored.)

  All this Mechanic discussed with Lansing over the phone. She empathized with the troubles he was facing, while feeling a huge sense of relief.

  “It was terrible,” she said. “The picture was going over and over. Everybody had written it off: ‘It’s going to be the biggest disaster ever.’ Everyone was saying, ‘Bill’s going to be fired.’ He kept believing in the film when a lot of other people at that studio didn’t. I knew how hard it was to shoot on water, where all sorts of things can run out of control, but I’d never imagined the film could go so far over budget.”

  As word leaked about the nightmare shoot, some of the cast and crew turned against their director. Winslet said at times she was “genuinely frightened of him,” while others called him a tyrant. Several crew members were fired or quit, and many called him “Mij” (Jim in reverse) when he revealed the dark side of his personality.

  The press turned savage. Newsweek headlined a story “A Sinking Sensation,” while Time wrote “Glub, Glub, Glub…Can James Cameron’s Extravagant Titanic Avoid Disaster?” The trade paper Daily Variety started to run regular, biting columns under the rubric “Titanic Watch.”

  But Lansing supported Cameron throughout.

  “She was very excited that the raw footage captured the sweep and emotion promised by the script,” said the director. “I had only ever done sci-fi, horror and action previously, so this must have been a relief. However, the costs were spiraling out of control, so I remember the praise from all parties becoming more sparing as time went on.”

  —

  Money continued to hemorrhage in postproduction, and relations between the two studios, already cool, became frigid. When Chernin asked Dolgen to kick in some more cash, and Dolgen refused, the two friends split irreparably.

  “Chernin said, ‘Jon, I need relief,’ ” recalled Goldwyn. “And Jon said, ‘I’m not giving you relief.’ Chernin said, ‘Jon, if you just give me some relief, we could renegotiate the profit participation, but man, I’m really exposed.’ Jon said, ‘No!’ It ended their friendship.”

  “We were carrying the movie on our books as a $55 million loss,” Chernin explained. “I went to Paramount and said, ‘Jon, you can’t make what you’re making while I’m still underwater. You can’t do that to me. I’m going to get fired for this and you’re going to make money standing on my neck. And that’s just wrong.’ He turned me down. I was very, very angry.”

  While Paramount and Fox were at loggerheads, Cameron was at war with both. At the former, his wrath fell on Robert Friedman, a longtime Warner Bros. executive whom Lansing had hired as her vice chairman, with a particular emphasis on marketing and distribution.

  Cameron despised Friedman’s plans for selling the picture, and loathed a trailer he had created, which stressed the film’s action sequences, as if the movie were merely a continuation of Cameron’s previous work rather than a great leap forward, as the director saw it. When he cut his own trailer, Friedman hated it.

  “We got a call from Robbie Friedman saying—and I quote—‘I just saw your trailer
and threw up on my shoes,’ ” said Cameron. “Sherry always loved the film, but the business heads at Paramount acted like they’d been diagnosed with terminal cancer. It was a highly contentious time and close to open warfare between the studios.”

  That warfare continued over matters large and small, including everything from the design of the poster to the date when the movie should open. As it became clear that Cameron would not be able to make the planned release—the July 4 weekend of 1997—the parties fought even more furiously. Late July was considered but deemed too early; then Thanksgiving was mentioned, but Fox disliked that idea.

  When Lansing called Chernin to discuss the movie’s opening, “Peter was very upset with me,” she remembered. “He said, ‘My dear, you don’t have the kind of money that we have in it, and we’ll determine when it’s going to be released.’ I said, ‘Good luck to you.’ ”

  Both sides had other movies that complicated the Titanic release, and for neither one was it as simple as choosing the date that was best for Titanic. Fox had two big pictures coming up at Thanksgiving, which made it the worst possible time to open Cameron’s picture, while Paramount was trying to keep Harrison Ford happy, knowing it would need him for its ongoing Tom Clancy action franchise, as well as a return to Indiana Jones.

  “Harrison Ford angrily warned studio executives that if ‘Titanic’ opened in late July, he would sever his relations with the studio that made some of his biggest hits, including ‘Raiders of the Lost Ark’ and ‘Patriot Games,’ ” reported the New York Times. “Mr. Ford was disturbed because his new film, ‘Air Force One,’ is set to be released by Sony on July 25.”

  The conflict over Titanic’s release spilled into the open at the Cannes film festival. “Tensions between the two studios over the film grew so intense…that Mr. Friedman and Mr. Mechanic came very close to a fistfight,” noted the Times. “Fox, eager to start earning income on the film, sought an August release [while] Paramount said August was too late to lure the summer audience and suggested Thanksgiving.”