Viacom to Break Ties With Cruise

Paramount Pictures is severing its lucrative 14-year relationship with Tom Cruise, whose recent off-screen behavior proved to be too much for Viacom Inc. Chairman Sumner Redstone, who disclosed the superstar’s termination Tuesday.

“His recent conduct has not been acceptable to Paramount,” Redstone said in an interview with the Wall Street Journal. Paramount is Viacom’s moviemaking arm.

The unceremonious dismissal of one of Hollywood’s highest-paid stars stunned the entertainment industry, with agents and movie executives privately questioning whether talent relations had sunk to a new low.

Redstone’s remarks are a sign of the mounting tensions between the major studios and their high-priced talent as movie costs soar.

Neither Cruise nor his lawyer, Bertram Fields, could be reached for comment. Cruise’s producing partner, Paula Wagner, hit back at Redstone .

“It is graceless. It is undignified. It’s not businesslike,” she said. “I ask, what is his real agenda? What is he trying to do? Is this how you treat artists? If I were another actor or filmmaker, would I work at a studio that takes one of their greatest assets and publicly does this?”

Wagner put a different spin on the split, saying she and Cruise decided to go in a different direction after negotiations with Paramount on a new contract collapsed a week and a half ago. Since then, she said, she and Cruise have secured outside funding to establish an independent production company. She declined to provide specifics.

Wagner noted that Cruise had made more money for Paramount than any other actor has made for any other studio in history. His last seven films have grossed more than $100 million each in the U.S., she said.

Cracks in the Cruise-Paramount relationship began to surface last month when the studio balked at renewing its commitment to pay the star and Wagner as much as $10 million a year to cover overhead, project-development and other costs at their movie production company.

That deal, which expired July 31, provided at least four times what stars such as Johnny Depp, Brad Pitt and Tom Hanks secure from their studios.

After failing to renew the contract, Paramount had extended the production deal for a month to continue negotiations, according to people with knowledge of the talks. Paramount offered the pair $2 million a year plus a $500,000 discretionary fund for each of two years, said the sources, who didn’t want to be named because of the sensitivity of the talks.

Top Paramount executives concluded that Cruise would not agree to their proposed pay cut, and that no new deal would be struck, sources said.

Paramount Chairman Brad Grey had expected to announce an amicable parting of the ways with Cruise when the relationship was to officially conclude at the end of this month, one source said.

For more than a year, Cruise’s public outbursts have made headlines and sparked speculation that one of Hollywood’s most bankable figures might be tarnishing his image.

In a series of unrelated incidents, Cruise publicly denounced Brooke Shields last year for taking antidepressants, jumped up and down on a couch during “The Oprah Winfrey Show” and proclaimed his love for fiancee Katie Holmes, and jabbed an accusing finger at Matt Lauer on the “Today” show as he lectured his host on the evils of Ritalin, a stimulant used to treat attention deficit disorder.

At the same time, Cruise’s increasingly vocal advocacy of Scientology has drawn attention to his faith -- at times colliding with his career.

“His religion has become very important in his life, to the point that it may overshadow his career,” said a person close to the situation.

Grey and his boss, Viacom Chief Executive Tom Freston, were upset by Redstone’s public dismissal of Cruise, according to several Hollywood sources.

They said Redstone had not discussed his point of view about Cruise with Paramount’s top management during the studio’s negotiations. One source said Redstone blamed Cruise’s behavior for turning off American moviegoers.

The 84-year-old patriarch, who built the nation’s third-largest entertainment giant from a small chain of drive-in theaters he inherited from his father, has told people that Paramount would have made more money on “Mission: Impossible III” if not for the actor’s off-screen behavior.

Redstone estimated that Cruise’s conduct had cost the studio between $100 million and $150 million in box-office receipts, said one person close to the Viacom chairman. Redstone declined to elaborate on his remarks Tuesday. Grey declined to comment, and Freston could not be reached .

While promoting “War of the Worlds” last year, Cruise butted heads with the film’s director, Steven Spielberg, who took issue with how little the actor talked about the movie and how much he talked about Scientology and his love for Holmes.

During the filming of “War of the Worlds,” the star asked to have information tents set up from the Church of Scientology. Holmes’ pregnancy was marked by reports of Scientology minders who guarded over her. The birth in April of the couple’s daughter, Suri, attracted global fascination when the once very-public pair all but disappeared from view. Photographs of the child have yet to be made public.

By late afternoon Tuesday, Redstone’s comments were rocketing by e-mail around Hollywood. Agents pondered the logic of a studio disavowing a star that had been so profitable for so long.

The effect of Redstone’s comments is potentially much greater than Cruise’s production deal. The powerful Creative Artists Agency, which represents Cruise along with many others on Hollywood’s A-list, isn’t likely to forgive the public humiliation.

“Paramount made an offer that wasn’t per se unacceptable, but money wasn’t really the issue,” said Rick Nicita, Cruise’s agent. “What this says about Paramount is self-evident. It was graceless and it was shocking and offensive.”

But despite such indignation, several other agents said Cruise’s expensive and high-maintenance behavior had made him less attractive to studios.

And Cruise is not the only star for whom the kid gloves have come off recently.

At the end of July, actress Lindsay Lohan received a stern letter, which was leaked to the press, from Morgan Creek Productions head James G. Robinson, who told her she had “acted like a spoiled child” and that he saw through her alibis of illness and fatigue for absences that have hampered the filming of the movie “Georgia Rule.”

At about the same time, actor Mel Gibson’s anti-Semitic outburst following an arrest for drunk driving prompted Sony Pictures head Amy Pascal to publicly condemn his behavior as irresponsible.

The cost to Cruise’s career has yet to be fully calculated.

His antics hurt him with females -- the demographic group that had consistently supported his films but showed up in smaller numbers for “Mission: Impossible III.”

That film is on track to gross $400 million worldwide, less than “Mission: Impossible,” which grossed $456 million 10 years ago and the 2000 sequel “Mission: Impossible II “ which brought in $546 million.

Brandon Gray, president and publisher of Box Office Mojo, an online box-office tracking service, said Cruise’s erratic behavior leading up to the release of “Mission: Impossible III” did not help the marketing campaign, which was centered around his image.

He said the movie didn’t perform as well as the first two because it never had a strong fan base to begin with.

“The first two were not that memorable to begin with,” said Gray. “But the fact that “M:i:III” didn’t have a compelling, fresh spin hurt it more than Tom Cruise’s public behavior.”

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Times staff writers Rachel Abramowitz and Lorenza Munoz contributed to this report.