Dark Victory

by Moldea, Dan E. ; Miller, Mark Crispin;

  The biggest talent bureau at the time was the New York–based William Morris Agency. It was founded in 1898 by Austrian immigrant Wilhelm Moses, who had changed his name to William Morris when he came to the United States. Morris had retired in the early 1920s, turning the agency over to his son, William Morris, Jr., a scholarly man who had no taste for the business. Young Morris made Abe Lastfogel, a charming and popular man who had worked for the William Morris Agency since he was fourteen, the company’s president. At that time, the agency numbered among its clients George Jessel, Jimmy Durante, Al Jolson, and Eddie Cantor.

  Another prominent talent agency was the Associated Booking Corporation, run by Joseph G. Glaser. Glaser was Louis Armstrong’s manager, as well as the exclusive agent for many of the top Black performers. A big Chicago White Sox fan who spent much of his time doing business at Comiskey Park, he had a reputation as a cold, crusty, hard-driving businessman. To ensure an edge in his business, he became a close associate of many of the top underworld figures in Chicago and New York, whom he had met through his band-booking agency.

  In 1924, a small, soft-spoken, professorial-looking man named Julius Caesar Stein started the Music Corporation of America—MCA—in Chicago with a stake of only a thousand dollars—which included twenty-five dollars for the incorporation papers.

  Born in South Bend, Indiana, on April 26, 1896, “Jules” Stein was the son of the proprietor of a small general store. His mother—who had bought him a mandolin as his first musical instrument—was an invalid whose care often drained the family’s meager bank account. As a result, Stein, even as a child, was forced to make his own money. By the time he was twelve, Stein had saved enough money to see himself through prep school. He never returned home. Initially intrigued by the possibility of becoming a professional flyer, the black-haired, brown-eyed Stein, who had a sharply angular face with a pronounced chin and jaw, decided to move in a completely different direction and studied to be an ophthalmologist. (The year he founded MCA he published a respected, erudite treatise on “The Use of Telescopic Spectacles and Distil Lensen.”)

  But Stein had been smitten by show business. He began his entertainment career in Chicago shortly after leaving home. At the age of 14, he was leading an orchestra; his favorite song was “Alexander’s Ragtime Band.” As he worked his way through the University of West Virginia, graduating at eighteen, and medical school at the University of Chicago, he played in and booked dance bands, describing himself as a “schmaltzy” violinist and saxophone player.* During World War I, he served in the Army Reserve as a medical officer. After the war, he headed for Vienna to pursue postgraduate work. Stein had also found time to take a three-year correspondence course in business.

  Returning to Chicago, he served a residency at Cook County Hospital and went into private practice, working as the assistant to Dr. Harry Gradle, one of the Midwest’s most eminent eye surgeons. Soon after, Stein met an old college chum, William R. “Billy” Goodheart. A quick-tempered but accomplished pianist, Goodheart was viewed as the kind of guy who would slap around the newspaper boy for throwing the morning edition in the bushes. “Goodheart was known as a ‘character,’” wrote one reporter. “He was said to sit in a raised chair so he could look down on his callers. When someone asked for two minutes of his time, he got just that—by a stopwatch. He carried pills for every ailment. He was a driver who demanded results and accepted no excuses.”2

  Goodheart shared Stein’s interest in the music business. The two men became partners in Kenneworth Music. They soon discovered that they were shrewd businessmen and had a knack for organizing and promoting bands. Their principal business came from the mob-controlled nightclubs and speakeasies on Chicago’s South Side, Capone’s territory.

  “I had a young assistant,” Stein remembered, “and he’d ring up about bookings while I had a patient in the chair. I’d be saying, ‘Can you read this, can you read this?’ and all the while I’d be speaking [on] the phone. We had Hushaphones in those days, a box around the speaker so nobody could hear what you were saying, and I couldn’t have done business without that.”3

  Stein recognized that he could make more money as a booking agent than anything else he could do. So Stein gave up his career with Dr. Gradle to found MCA with Goodheart. Overnight, Dr. Stein became simply Jules Stein. Working from a tiny, two-room office in downtown Chicago, Stein and Goodheart quickly began finding jobs for dance bands and other musical performers throughout the Midwest, as well as advising clients on their careers. In return, they usually took a ten-percent commission.

  Stein was responsible for inventing the concept of “rotating bands” for the one-night stands and the week-long engagements. He convinced club owners that their businesses would grow if they frequently brought in new entertainers. Before that time, bands would play in one location for months, even years.

  Stein and Goodheart also insisted that MCA be the exclusive agent of those bands and bandleaders it represented and later demanded that dance halls with which they worked hire MCA bands exclusively—a practice which had been unheard of previously. Once signed, MCA’s clients and customers would then be offered MCA deals on automobiles and insurance policies. To secure bookings, MCA, according to several sources, occasionally resorted to intimidation. Some clubs that refused exclusive arrangements with MCA became the targets of “stink bomb” attacks, which would be launched during the acts of other agencies’ bands.4

  The dance band business meant an itinerant existence. Booking agents handled the details of getting acts from place to place and finding them places to stay. Many bands had to play nearly every night, traveling from city to city, state to state in order to make enough money to survive. Bands might consist of as few as five and as many as twenty musicians. MCA made sure they were taken care of. For many trips band managers, arrangers, and soloists might also have to be included. MCA had to provide for them as well. “Name” bands traveled in their own buses; “semi-name” bands had to lease or rent. MCA was also responsible for arranging radio broadcasts, as well as supplying publicity—posters, press releases, and newspaper ads. For its ten-percent commission, MCA took care of everything as part of its package deal, leaving the clubs with little to do.

  MCA remained in constant touch with dance hall operators in the various states while its bands were on the road, trying to extend their tours or fill in open dates. Whenever possible, MCA tried to gain exclusives with the clubs and hotels, providing them not only with bands but with liquor, glasses, linen, and even confetti.

  Stein and MCA handled themselves so professionally that bigger-name bands began to take notice and sought to be represented by them. Among others, Stein had penned a contract with the Coon-Sanders Kansas City Nighthawks, which played a softer variation of jazz. But Stein still did not have a big-name band and a way to crack the lucrative New York big-band market.

  In 1928, MCA pulled its first big national coup by signing Guy Lombardo and his orchestra to an exclusive contract. Goodheart—whose goal was to make a million dollars by the time he was forty—first approached Lombardo while he was playing at the Music Box, a nightclub in Cleveland, Ohio. Lombardo rejected MCA’s offer at first, insisting that he neither needed nor wanted an agent. But after Stein pulled strings to get him a long-term contract at the Roosevelt Hotel in New York, Lombardo signed, bringing in tow his close friend, pianist Eddy Duchin. Other major bandleaders followed in Lombardo’s wake. Goodheart left Chicago and opened the agency’s New York office in the Paramount Theatre Building at 43rd and Broadway. MCA began to lock up bookings at New York’s Waldorf-Astoria and many of the big, luxurious hotels and nightclubs in Chicago, New York, Miami, and Los Angeles.

  By the mid-1930s—the Big-Band Era—MCA represented more than half of the major bands in the country, including those of Harry James, Tommy Dorsey, Kay Kyser, Xavier Cugat, Artie Shaw, and Gene Krupa. The agency booked them for one-night stands, as well as long-term engagements at dance halls, nightclubs, ice shows, county fairs
, and big-city hotels. Stein, who had become a man-about-Chicago, was driving a Rolls-Royce and had purchased a beautiful French-style estate overlooking Lake Michigan.

  With the growing popularity of musical programs on the radio—particularly on WGN in Chicago—Stein gained the support of his childhood friend, James Caesar Petrillo, the president of the Chicago local of the American Federation of Musicians (AFM).

  Petrillo was the classical tough-guy labor boss. Born in 1892, the son of Italian immigrants, and a cornet-playing product of the Chicago slums, Petrillo had started as a union official for the Chicago local of the American Musicians Union in 1915. After losing his bid for president of his local in 1918, Petrillo abandoned the AMU and went to work for the AFM. In 1928, he became president of the AFM’s Chicago local.

  A small man, five feet six inches tall, with a fourth-grade education, a gruff style, rimless glasses, and monogrammed shirts, he spoke salty, ungrammatical English in a grating voice and rode around in a bulletproof limousine. He was an extreme egotist and a shrewd and treacherous political infighter who ruled his union like a dictator. He loathed record companies, calling them “musical monsters which were killing employment” for live musicians, and eventually succeeded in making the companies pay artists for each record sold. He also forced the radio networks to pay their musicians at union scale regardless of whether the musicians were needed or not.

  “If I was a good trumpet player,” Petrillo said, “I wouldn’t be here. I got desperate. I had to look for a job. I went into the union business.”5

  When he became national president of the AFM, union boss Petrillo became the most powerful figure in the music industry. He performed many favors for Stein. (Stein was given AFM’s membership card number one and attended nearly all of its union meetings.) Petrillo used his clout to prevent other big-band talent agencies, in competition with Stein, from obtaining licenses to operate, thereby helping to give Stein and MCA a virtual monopoly over the major bands in the music business. Whenever a dispute arose between a band and MCA, the executive board of Petrillo’s union always sided with MCA. One source said he could not recall a single case before the AFM board that was won by a union member against MCA. “The fix was always in,” he said. “Big-band leaders were pretty consistently voted down by AFM whenever they had a dispute with MCA.”6

  Petrillo also granted MCA an exclusive “blanket waiver,” permitting Stein’s firm to operate as both booking agent and radio production company—despite the fact that such an agreement was considered a conflict of interest and violated the AFM’s by-laws. For instance, MCA, for as much as a thirty-percent profit, would package an entire radio program, complete with bands, singers, writers, directors, and producers, and sell it to the networks—even though all of the participants were represented by MCA. If a performer had a grievance, it would be difficult for him to complain to his agent, also his employer, who maintained a sweetheart relationship with his union.

  With its association with Petrillo and AFM, MCA—along with its radio sponsor, Lucky Strike cigarettes—started producing network radio programs. MCA went to radio networks and told them, “We’ll give you bands, but only if you give us remote radio lines.” MCA agents then approached bandleaders, asking, “How would you like to be guaranteed forty weeks of employment during the year and to appear on radio every week on NBC’s Lucky Strike Hit Parade?” What band could refuse such an offer? Finally, MCA would go to a prominent hotel owner and ask, “How would you like to have a big-name band, and have the band originate music from your hotel—with the hotel mentioned on a national radio hook-up every week?” The result was national exposure for MCA bands.

  MCA followed the Lucky Strike Hit Parade with The Magic Carpet and later the Camel Caravan. All of these programs featured a rotation of MCA bands.

  Because MCA had started to replace advertising agencies as the packagers of big-band music programs—while it continued its dual role as agent and producer as well—the growing corporation needed a great deal of cooperation and protection. Justice Department documents have charged that union officials, club owners, and bandleaders who cooperated with Stein often received “payola,” in the form of cash, cars, and sometimes MCA stock options. “[I]t was well known that Petrillo took ‘ice.’”7

  The government also alleged that union leader Petrillo eventually became a millionaire—even though his yearly union salary reportedly never exceeded $26,000—as a direct result of his sweetheart relationship with MCA. Although the Justice Department uncovered evidence that Petrillo had received payoffs from MCA and other sources, he was never indicted.

  *President Woodrow Wilson encouraged the General Electric Company to form RCA because he feared that the technology for wireless radio transmissions would be controlled by foreign nations in the wake of World War I. GE was RCA’s largest stockholder. Other investors included AT&T, Westinghouse, and United Fruit.

  *One of Stein’s stints was in the backup band for Mae West’s vaudeville show.

  CHAPTER TWO

  The Mafia in Chicago was formed during World War I when “Big Jim” Colosimo, an Old World Sicilian racketeer, put together a loose-knit, mostly disorganized network of other Italian/Sicilian criminals to protect his brothels and other illegitimate businesses. Among those surrounding Colosimo was Johnny Torrio, a street-smart hood, who brought Al Capone into the organization in 1919. Capone had come from New York and was known as a ruthless assassin. He was also a cousin of Charles “Lucky” Luciano, who had been operating with Meyer Lansky and Benjamin “Bugsy” Siegel.

  Torrio came to believe that Colosimo had little foresight and did not possess the imagination and strength to make his brand of disorganized crime organized. Consequently, Torrio contracted for Capone to murder Colosimo in 1920. Torrio succeeded him as the head of the Chicago Mafia, using Capone to systematically wipe out rival Irish and Sicilian gangs. By 1923, Capone had been named as Public Enemy Number One.

  During Prohibition, Torrio changed the face of the underworld, particularly in Chicago, where he “made” or admitted criminals from other ethnic backgrounds into the traditional Italian/Sicilian crime group. Illegal money obtained through bootlegging, gambling, loan-sharking, and prostitution was channeled into legitimate businesses. But Capone quickly became too ambitious and tried to have Torrio executed. Even though Torrio survived, he decided to step aside for his younger protégé.

  During the Capone reign of terror, the Chicago Mafia became the most feared crime organization in the United States. Disorganized crime became organized—with all the implicit degrees of control and discipline. By 1931, the Mafia had become “Americanized.” The last of the Old World “Mustache Petes”—first-generation leaders of the American-Sicilian underworld—were slaughtered in September on the orders of Luciano, who retained the services of his associates Lansky and Siegel.

  Four days after this bloody purge—which signaled the end of the “Castellammarese War”—a national crime syndicate was established. The United States was divided into twenty-four subdivisions, each controlled by the most powerful Mafia families in these various geographic areas. Nine of the leaders of these twenty-four crime groups were selected to sit on a national crime commission that would settle jurisdictional disputes.

  This syndicate was created to frustrate the infighting among Mafia families that was interfering with the mob’s primary goals to make money and to stay out of jail. With the increased stability and decreased exposure, mob financiers like Lansky were free to find legal and illegal money-making ventures, raise the necessary capital from participating crime families, launder funds through “friendly” banks, buy political protection, and oversee the fair distribution of profits from these activities.

  By the time Capone began having his problems with the IRS, his enterprises were operating smoothly enough to survive his tax fraud conviction and imprisonment in 1931. Frank Nitti slid into power, backed by Capone’s entire empire. Among Nitti’s top associates was Jake “Greasy Thum
b” Guzik, who was the Chicago underworld link to legitimate business and to the law-enforcement officials, judges, and politicians who walked around the city with their hands out, looking for someone to grease them.

  Some politicians who opted to battle the Mafia found themselves in trouble. Chicago mayor Anton Cermak, a hardliner against the Chicago crime syndicate, was shot and later died from his wounds while campaigning with President-elect Franklin D. Roosevelt in 1933. Although it was widely thought that the assassin, Giuseppe Zangara, was really a nut gunning for Roosevelt, Cermak, before his death, insisted that he was the real target. Cermak added that he had been threatened because of his crusade against the underworld and had purchased a bulletproof vest—which he forgot to wear the day he was shot.1

  Jules Stein’s success in the band-booking business had been so complete that he attempted to get into areas peripheral to his own business, such as bootlegging. In doing so, he stepped on the toes of some powerful Chicago mobsters. The full story of Stein’s dealings with the Chicago Mafia is fuzzy. There are conflicting accounts about the extent and true nature of his involvement with the underworld.

  According to one version, the Chicago Mafia had watched Stein’s successes with envy from the start and had tried to move in on him during the early 1930s, demanding a share of the action. In the midst of Prohibition, while he was booking bands into Chicago’s speakeasies, Stein had also started bootlegging whisky and selling it to nightclub owners as part of the deals for his bands. According to Justice Department documents, his thriving sales crossed over into the jurisdiction of Chicago bootlegger Roger Touhy, an arch-rival of Capone.