A Royal Comeuppance : Nasty Tax Trial Has Turned N.Y. Hotel Queen Leona Helmsley Into Laughingstock of the ‘Little People’

When her tax fraud and extortion trial began June 26, hotel queen Leona Helmsley arrived looking appropriate.

The color of her face was purple. Royal purple.

Since then, reporters covering the trial have been playing a mean-spirited guessing game. Did the 69-year-old billionairess undergo a face peel to remove unwanted wrinkles? Could it be effects of the anti-aging skin cream Retin-A? Was she suffering some disfiguring stress condition?

Helmsley herself explained to an employee that she had an “allergy.”

No doubt, an allergy to bad publicity.

Everyone, it seems, wants to jump on the I-hate-Leona bandwagon this summer. And the worst of it seemed to take place last week outside the oversized, wood-paneled federal courtroom in Foley Square where Helmsley and her 80-year-old husband, Harry, are accused of failing to report more than $4 million in payments from their business between 1983 and 1986, including improperly billing their companies for a long list of adornments on their $11-million, 28-room, 26-acre estate in Greenwich, Conn., known as Dunnellen Hall.

She Bears the Brunt

Because Harry Helmsley was ruled mentally incapable of assisting in his defense, his wife of 17 years has borne the brunt of the massive media and public outcry over their alleged financial wrongdoing. In the process, her formerly fairy-tale life has turned into nightmarish episodes from “Life Styles of the Rich and Infamous” thanks to daily revelations about her mercurial personality--much to the amusement of the “Little People,” as Helmsley herself once derided anyone stupid enough to pay taxes.

There was Mayor Ed Koch, who’s running for re-election this year, seeking to shift attention off corruption in his administration and onto Helmsley when he declared sanctimoniously that she was “The Wicked Witch of the West.” There was her own hotshot lawyer, Gerald Feffer, describing her as a “tough bitch” as part of his defense strategy showing that people shouldn’t be jailed for being unpopular.

There was the ad agency that, the joke goes, “fired” Helmsley after she demanded that the firm accept a 40% cut in fees for hawking the 26 hotels the Helmsleys own worldwide. Elaine Taylor-Gordon, the agency’s president, offered to send her successor “all our Maalox, Advil and extra suits of armor.”

There was disc jockey Don Imus, a fixture of New York morning radio, who nominated her for “Insect of the Year.” And “No Excuses” jeans, which gave her its monthly award for raising the question, “Hey, since when is it a crime to redecorate?”

There was even Helmsley’s arch-rival, fellow developer and hotel owner Donald Trump, who, making his first comments since the trial opened, declared she was “a sick woman” after evidence in court showed the Helmsleys tried to cheat Trump when he bought the St. Moritz Hotel from them in 1985. “As bad as she’s been portrayed, she’s worse,” the master of the art of the deal said about the woman accused of the art of the steal.

“I can feel sorry for my worst enemy, but I cannot feel sorry for Leona Helmsley. She deserves whatever she gets.”

But does anyone feel sorry for Helmsley? And what will she get?

Six weeks into the trial, certain trends are becoming clear: public opinion is definitely against Helmsley, and the government’s case against her is said by lawyers to be overwhelming. But the prosecution is expected to wrap up its case this week, and anything can happen once the defense takes over and the case goes to the jury, perhaps as soon as Labor Day.

“The damaging aspect is just having your whole life spread over the papers every day,” noted prominent New York attorney Stuart Smith, who has represented celebrities like Helmsley in similar tax fraud cases. “There’s a great public appetite for seeing the high and mighty humbled. And she’s a natural.”

‘Delicious Target’

“Mrs. Helmsley is an especially delicious target because here is a woman who styled herself as the queen,” Taylor-Gordon reminded. “Who among us could endure such scrutiny?”

Apparently, Helmsley least of all.

Last week, for example, Helmsley’s American Express bills for recent years were included in court records because prosecutors say she charged hundreds of personal items to corporate accounts. The charges ranged from the mundane, two $1 pints of Columbo yogurt, to the massive, a $210,000 jade figurine of a water buffalo. “We were even able to see how many bras and girdles she bought and where. It’s like a diary of this woman’s life,” marveled Esther Pessin, the trial reporter for the New York Post. “After a while, we’ll be writing about everything . It’s disgusting.”

That may already have happened. Of dubious news value is that Helmsley has an aide stand outside her stall when she goes to the bathroom. Or that she had a nose bleed that she stemmed with several Kleenex. Even that she eats a $1.57 “tuna surprise” salad for lunch in the courthouse cafeteria and picks up the vegetables with her fingers.

Of course, the question arises whether Leona Helmsley would get this sort of scrutiny if her name were Leon Helmsley. The conventional wisdom seems to think not. Or, as Newsday columnist Jimmy Breslin put it, “newspapers think dames make news.”

And if she were a man on trial? “It wouldn’t get three paragraphs,” he claimed.

Even Taylor-Gordon, the advertising executive who quit the Helmsley account because she got sick of the boss--describing one meeting where Helmsley drank martinis and she drank Milk of Magnesia--believes the queen has fallen victim to unfair sexual discrimination.

‘A Sitting Target’

“For a woman to have the audacity to be so tough and so successful and so arrogant makes her a sitting target. But women of her generation are all that way,” Taylor-Gordon said. “They paved the way for me and my sisters. I don’t understand how people can forget that. And, I know this sounds ridiculous, but in some ways, she has qualities that we would want in our role models--her accomplishments, her street smarts, her taste level, which is really wonderful.

“Unfortunately,” Taylor-Gordon noted dryly, “she has some qualities that are less admirable, which is where the focus has been placed.”

Indeed, Helmsley used to be praised for the very things she is being condemned for now--her fussiness, her chintziness, her toughness. But these days few bother to recall that before she married her Sugar Daddy, she was one of the shrewdest and savviest real estate brokers in New York City, pulling down an impressive $1 million annual salary. In fact, it was the very way that she ruled her hotels with an iron hand--the queen-standing-guard ad campaign, specifically--that made people want to stay in them.

“Her feeling was that her guests loved her. And you know what? I think she’s right,” said Taylor-Gordon, who claims that the super-deluxe Helmsley Palace has not suffered any fall-off in business since the trial began.

Once accusations of wrongdoing swirled, however, Taylor-Gordon suggested “strongly” to Helmsley that she remove her ever-present photograph from the hotel ads, even though they had progressed from large full-length pictures of Helmsley in a tiara and ballgown to a small corner portrait a la Betty Crocker.

“But she said, ‘I want my picture in every ad,’ ” Taylor-Gordon explained.

‘Makes Her Look Arrogant’

That may be why public sentiment is against her now. “It makes her look incredibly arrogant and imperious, and I think people can forgive someone almost anything except that,” Taylor-Gordon said. “And I think that’s why she’s being crucified in the press and why people are enjoying her discomfort. After all, she was quoted as calling them “ ‘little people.’ ”

Indeed, a sort of Munchkin Mania has taken hold as all the “little people” come to court to give Helmsley what for, both on the witness stand and in the spectator section.

Watching the trial is a hodgepodge group to be sure, from secretaries on their lunch breaks and law students hoping to see legal history made to little old ladies taking a shopping break to escape the 90-degree summer weather. “I came to see the queen,” said Selma Solkowitz, a Lower East Side retiree who was clutching her purchases from Houston Street as she settled into the bench in the cool courtroom. “I came to see the queen get hers.”

Meanwhile, some have dubbed the trial “The Revenge of the Nerds” because of the bevy of balding, bespectacled and big-bellied executives, engineers and accountants testifying for the prosecution how they were made to work seven days a week saving the Helmsleys’ money, and the slew of contractors, decorators, art dealers and maids complaining about how impossible it was to please an impossible mistress and still keep their jobs. Or, as the staid New York Times declared in an editorial last week, “Oh, how the worms have turned!”

And along the way fall enough morsels for the media to chew on for months. Like the time Leona Helmsley dropped crumbs on the floor just to see if her maids would sweep them

up.

Still, in recent weeks, the Helmsley trial has slid off the front pages to a less prominent position inside,partly because of a continuing court-imposed gag order on all the defendants and their attorneys. Ironically, Helmsley herself is an inveterate tabloid reader, preferring to devour the Daily News and leaves the more staid New York Times and Wall Street Journal to her husband. Nor does she show any resentment toward the journalists writing about her.

When she saw one reporter smoking, she offered a tip on how she stopped her three-pack-a-day habit (whenever she’d have a craving, she’d rinse her mouth out with Listerine). And though the New York Post broke the story of the Helmsleys’ alleged illegalities, reporter Pessin maintains that Helmsley “comes up and pinches my cheek.”

Why All the Interest?

Still, that mainstay of New York columnists, Breslin, wonders whether the media is more interested in the case than their readers.

“Is she news because people hate her? Or is she news because it’s summer and newspapers need something to write about?” he said.

There may even be a subtle groundswell of support for Helmsley as the case drags on. “Now that it’s taking this long to get her,” Breslin said, “she could wind up a heroine.”

Pessin maintains that her editors want her to tone down the invective against Helmsley because they fear that reporting has verged on “the overkill level. At one point, people are going to say, ‘Leave the woman alone .’ ”

And Taylor-Gordon maintains that, as the indictment has progressed, she has heard “a lot of support” for Helmsley voiced among businesswomen privately.

Still, several New York image-makers describe Helmsley’s plight as a “true public relations crisis.” One executive with the prominent New York public relations firm of Ruder Finn, which represents such corporate clients as Citibank and American Express, said it’s a “situation crying out for some humility.

“Unfortunately,” the executive added dryly, “she hasn’t really done that.”

Getting the Message

She may be getting the message, however. Last week, Helmsley dressed down the president of St. Clare’s Hospital for smoking near her in a restaurant. The two strangers wound up talking for hours about the hospital’s work with AIDS patients. Two days later, she sent the administrator, Richard Yezzo, a note on Helmsley Hotel executive stationery and a check for $5,000 made out to the hospital.

“I don’t care what anyone says about her,” Yezzo declared. “I am just wild about Leona.”

So are the fashion experts. Throughout the trial, Helmsley has looked great, dressing in crisp suits, pastel knits and figure-hugging sheaths with a minimum of jewelry--only a demure pair of earrings, watch, wedding band and an occasional string of pearls for accent.

So great, in fact, that the day she wore a glamorous Chanel suit, complete with its trademark attention-getting gold buttons, her lawyer threw a fit.

“What are you, crazy?” he hissed at her in a low voice. “Think this is a fashion show? We’ll get a runway and bring in models.”

Since then, her outfits have been far less showy.

For the most part, Helmsley sits straight-backed with her defense team, stoically enduring the proceedings.

Because of the gag order, she shuttles between her beige-and-black Lincoln Town Car and the courtroom without stopping to chat with reporters.

No Cheering Section

Helmsley has no cheering section to speak of. Occasionally her 21-year-old grandson by her late son’s first marriage, Craig Panzirer, stops by, and a niece has shown up once or twice. But the rest of the time the only people in her corner are her two bodyguards, both former New York City police officers. She has had personal protection since 1973 when a knife-wielding burglar attacked the Helmsleys in their Florida home, puncturing Leona’s lung.

So far at least, the bodyguards haven’t had much to do. Helmsley has remained relatively undisturbed, save for some occasional heckling, including shouts of “Pay your taxes, baby.” On the first day of the trial, a whacked-out man in the courthouse cafeteria yelled to her, “You’re going to jail” and had to be forcibly removed by federal marshals.

Well, will Helmsley go to jail?

“On tax evasion, absolutely,” said Stuart Smith, a senior tax attorney with the prominent New York firm of Shea & Gould, echoing the opinion of several lawyers. Smith especially knows of what he speaks: he was part of the defense team for Aldo Gucci, the fashion patriarch who pleaded guilty in January, 1986, to conspiring to evade more than $7.4 million in federal income taxes. The 81-year-old designer received a year and a day in prison, which considering his age and prominence was “so surprising,” Smith noted. “But the days of the 30-day slap-on-the-wrist community service are over, really over.”

So it’s little wonder that prominent attorneys in town are questioning Feffer’s so-called “tough bitch” defense strategy. One top lawyer even said he was “flabbergasted” by it.

‘Dangerous’ Strategy

“The strategy is not just quite dubious but also very dangerous,” said the lawyer, who asked not to be identified because he didn’t want to publicly criticize a colleague. “It really seems fantastic for a jury to agree that simply because somebody was so mean that they’re innocent of these crimes, especially when their initials are all over everything.”

“Ninja” attorney Richard Golub, who’s representing Sandra Jennings in her palimony suit against actor William Hurt and whose tough courtroom tactics have earned him the title as the “new Roy Cohn,” admits that even he has never used the “tough bitch” strategy.

“If the client is in the frying pan and you take that approach,” Golub said, “all you’re really doing is putting Crisco in the pan.”

The reason, Golub said, is that by painting Helmsley as a shrew in designer clothing, Feffer is “joining forces with the prosecution.” What would Golub do? “I’d show the jury she’s a magnificent, wonderful, great person,” he said.

But couldn’t she do that herself--by taking the witness stand? At present, it’s extremely unlikely that Helmsley will testify in her own defense--a tactic with which Smith, for one, agrees wholeheartedly. “From what I’ve seen, someone like that would require a lot of training and coaching to act in a contrite and controlled way. Given what we’ve heard about her tendency to fly off the handle, it’s hard to believe she could stand cross-examination without getting angry or dressing down.”

But Golub disagrees.

“She’s a very cunning, very adept, very smart woman. She could probably testify in a very winning way,” he surmised. “After all, anybody who’s the queen of those hotels certainly could establish herself as the queen of the courtroom.”