Homeowner Groups Join Fight Against Hollywood Chamber

Locked in a legal battle with communities in 11 states in a bid to gain exclusive use of the name “Hollywood” for commercial purposes, the Hollywood Chamber of Commerce now faces opposition in its own back yard.

Three Hollywood neighborhood groups--angered at the way the chamber has managed the landmark Hollywood sign--have cast their lot with Hollywoods from Florida to New Mexico to oppose the chamber’s application to the U.S. Patent and Trademark Office for a service mark.

The mark would allow the chamber, which already owns rights to the name in California, to profit from the sale of T-shirts, coffee mugs and other items bearing the Hollywood logo sold anywhere in the United States.

“We don’t think the chamber or any other group should have the right to profit off something that belongs in the public domain,” said Ed Cohan, a lawyer representing Hollywoodland Homeowners Assn., Whitley Heights Civic Assn. and Hollywood Heights Assn.

‘Sour Grapes’

Chamber official Bill Welsh dismissed the opposition by the neighborhood groups as “sour grapes on the part of a few people” at odds with the chamber over the sign.

Cohan and others have for months pressed the chamber to disclose its finances involving the sign, something chamber officials have been reluctant to do.

However, an examination by The Times of records on file with the state found that of $122,166 in assets that chamber officials reported last year as belonging to a tax-exempt trust fund set up to maintain the sign, $53,158 has been on loan to the Chamber of Commerce for five years.

To obtain the tax-exempt status, chamber officials agreed that the funds were to be used exclusively for sign maintenance. But a source close to the chamber’s executive board, who spoke on the condition that he not be identified, acknowledged that the borrowed money had been used to cover the chamber’s operating expenses.

Agreement Over Sign

Although the famous sign atop Mt. Lee in Griffith Park is under the jurisdiction of the Los Angeles Department of Recreation and Parks, the chamber, under an agreement with the city, has been responsible for its upkeep since 1978, after raising nearly $300,000 to save it from extinction.

The Hollywood Sign Trust was established in 1978 as part of the chamber’s fund-raising effort to save the landmark. About $214,000 of the almost $300,000 placed in the fund was spent that year to rebuild the sign. The remainder was to be held in the trust fund to maintain the sign.

Asked about the chamber’s borrowing from the trust fund, Welsh said he did not know to whom the loan was made or why.

“All of that happened several years ago and I just don’t remember the particulars,” he said. “However, I can assure you that there’s no money missing, nothing illegal has occurred, and the trust’s resources have not been used inappropriately.”

Larry Kaplan, who recently was appointed president of the chamber, said he intends to conduct “a thorough review” of the situation, and expressed confidence that “when all the dust settles the community will be able to look at what the chamber has done and be proud.”

In a declaration filed with the state setting up the trust, chamber officials agreed that the trust was “not to be affiliated with or controlled by the Hollywood Chamber of Commerce or any other organization.”

$600 on Sign Repairs

Although the express purpose of the fund was to provide for sign maintenance, federal and state records show that as of the most recent filing period, ending last June, the trust has spent only about $600 on sign repairs since the fund was created, compared to more than $3,300 in bank and accounting fees.

The sign, built in the 1920s, originally spelled out “Hollywoodland,” the name of the real estate subdivision it was built to promote. It was declared a Cultural Historic Landmark in 1973.

Originally illuminated by 4,000 20-watt bulbs, the often-vandalized sign has long been a sore spot with residents in the nearby Hollywood Hills.

For years they have complained of their neighborhoods being under assault from trespassers, loiterers and vandals drawn to the sign. They were upset last year after the chamber announced a plan to light the sign permanently with the help of a solar energy company. The plan was dropped after widespread public opposition.

“We don’t think the chamber has done much to deserve our trust,” said Christine O’Brien, president of the Hollywoodland Homeowners Assn., in explaining her group’s involvement in opposing the service mark. “They’ve certainly not been cooperative with us.”

Linda May, the chamber’s vice president for finance, said that while the trust records may not reflect much spent on the sign, the chamber spent $10,500 to paint the sign in 1987, using money from another account it set up that year.

Helped Fox Broadcasting

She said the account was established with $27,500 paid to the chamber by the Fox Broadcasting Co. for permission to temporarily alter the sign to promote the network’s debut.

Despite opposition from nearby residents, the Department of Recreation and Parks approved the promotion after an appeal by Welsh, who said the sign was badly in need of refurbishing and that the chamber lacked the funds to do the job.

Yet records filed with the state show that the sign trust fund contained between $62,000 and $66,000 in cash at the time, not including the $53,158 on loan to the chamber.

Welsh defended the decision not to spend more from the trust, saying it was “necessary to keep an adequate amount of funds on hand in case of emergencies.”

“If you figure the cost of replacing one letter is something like $35,000 or $40,000, if we have an earthquake or a violent windstorm that knocks down a couple of those letters, we’re in trouble. It makes good sense to keep contingency funds.”

He said the 1987 account “was set up as a matter of convenience” to avoid having to disrupt the trust’s certificates of deposit when money was needed for the sign.

Just this month the chamber’s executive board approved construction of fencing around the sign to help ward off vandals and other trespassers at an expected cost of about $20,000, Welsh said.

Critics Still Upset

But the chamber’s critics, who have long pushed for improved security around the sign, are upset that it has taken this long.

“We’ve been trying to get them to spend the money, and asking them why, if the money’s there, they don’t do something useful with it,” O’Brien said. “The answer has always been no answer, a runaround.”

Meanwhile, a Hollywood historic preservation group has said it wants to join the neighborhood groups and others in opposing the service mark application.

Marian Gibbons, a spokeswoman for Hollywood Heritage, said she has invited delegates from the other Hollywoods to hold a “Hollywood Summit” in Los Angeles later this year.