PEOPLE WATCHTerminator Diplomacy: Arnold Schwarzenegger, whose movie...

PEOPLE WATCH

Terminator Diplomacy: Arnold Schwarzenegger, whose movie characters generally terminate opponents rather than talk to them, tried his hand at Mideast peacemaking Thursday in Tel Aviv. The actor met with Prime Minister Yitzhak Rabin for half an hour to discuss “some of the important things in the peace negotiations that are going on now, which I’m fascinated with,” Schwarzenegger said at a news conference. The Austrian-born star’s 24-hour stay in Israel--he was there to open a restaurant--included a public arm-wrestling match with Tel Aviv Mayor Roni Milo. Schwarzenegger prevailed over the relatively diminutive politician and was awarded an ornate key to the city. Later, Schwarzenegger mounted the roof of the beachfront restaurant, released a white dove and thanked the fans for their “great, loyal, dedicated” support. “Shalom, and I’ll be back!,” he said.

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Court Sides With Farrow: New York’s highest court has sided with Mia Farrow in her bitter custody battle with Woody Allen. The Court of Appeals refused Wednesday to hear Allen’s appeal of a lower court ruling that questioned his judgment as a father and awarded custody of Moses, Dylan and Satchel to their mother.

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Harrelson’s Father Foiled: A guard foiled an attempt by Woody Harrelson’s father to escape from the Georgia prison where he’s serving life for assassinating a federal judge, authorities said. Charles Harrelson, 56, and bank robbers Gary Settle, 29, and Michael Rivers, 56, apparently hid out in a recreation yard until dark Tuesday, when they approached a wall with a makeshift ladder, prison spokesman Mike Binion said Thursday. They surrendered when a warning shot was fired from the guard tower.

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Drummer Arrested: Def Leppard drummer Rick Allen was arrested for allegedly slamming his wife, Stacy Lauren Allen, against a wall at Los Angeles International Airport. Allen, 32, was booked for investigation of spousal abuse in the incident Wednesday night.

MOVIES

Castle Rock Denies Report: Castle Rock Films has denied a Reuters news service report that British actor Kenneth Branagh was to be paid $11.15 million for his role in Shakespeare’s “Othello,” saying that it had set a total budget of $10.5 million to make the film. Castle Rock declined to say how much Branagh will be paid.

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‘Kids’ Gets NC-17: Excalibur Films announced Thursday that it will appeal to the Motion Picture Assn. of America after the controversial “Kids”--Larry Clark’s graphic portrayal of a day in the life of some amoral, sex-obsessed New York City teens--was given an NC-17 rating. The ruling, however, was not unexpected, and Excalibur--formed by Miramax co-chairmen Harvey and Bob Weinstein to sidestep any conflict with Miramax’s parent Walt Disney Co.--had said earlier that it would release the film unrated if it got an NC-17 rating.

POP/ROCK

Axton Hospitalized: Hoyt Axton has been hospitalized in Hamilton, Mont., after reportedly suffering a stroke. The 57-year-old singer, songwriter and actor was eating, talking and doing well, it was reported Wednesday night. Marcus Daly Memorial Hospital confirmed that Axton was a patient there. A supervisor who declined to be identified said Axton had ordered that no other information be released, including when he was admitted.

TELEVISION

Production Starts on ‘New York’: Production has begun on a five-part, 10-hour documentary series on the history of New York City. The series, scheduled to premiere on PBS during the 1997-98 season, will be produced by Ric Burns and Lisa Ades. Burns, who also produced with Ades the critically acclaimed “The Way West” miniseries, is the younger brother of Ken Burns, whose works include “The Civil War” and “Baseball.”

AWARDS

ACLU Honors Fuchs, Marshall: Michael Fuchs, chairman of HBO and Warner Music Group, and movie director Penny Marshall will be given Torch of Liberty awards by the ACLU of Southern California at an awards dinner Sept. 11 at the Century Plaza Hotel. The awards “honor men and women from the arts and entertainment industry whose work affirms the basic values that are the foundation of the ACLU,” an ACLU spokesperson said.

QUICK TAKES

Adam Sandler won’t be returning to “Saturday Night Live” this fall after asking to be released from his contract to pursue his movie career. . . . Former White House spokesperson Dee Dee Myers, arrested last week for driving under the influence, has canceled her appearance Monday night on NBC’s “Tonight Show.”