As the Escrow Flies : There’s more room than ever in the film business for wannabe players. Just ask the people involved with last summer’s aborted feature ‘Divine Rapture.’

Last Sunday, Calendar reported how Orion Pictures, unable to finance its own slate of films, turned to a film-financing company known as CineFin, two of whose principals, Fred and Richard Greenberg, had been booted out of the banking industry by federal regulators. This week, how producer Barry Navidi’s dream--”Divine Rapture”--came undone in July 1995. The full truth may yet come out in litigation.

*

‘Divine Rapture” had its genesis nearly 20 years ago, when Glenda Ganis saw an item in The Los Angeles Times about a Sicilian woman who’d died and come back to life 12 hours later. The woman hadn’t really died, it turned out; she had catalepsy, a psychological disorder that makes the muscles go rigid and the body completely non-responsive. Ganis, who was married to veteran Hollywood studio executive Sid Ganis and working as a production designer, saw the whole story in a flash: A woman in a remote fishing village in a Catholic country goes cataleptic and wakes up as if by miracle. She wrote a 26-page outline and put it aside. Ten years later, she met an Italian producer who talked her into writing it up as a script. The title was “Mamma Mia.”

The producer disappeared and “Mamma Mia” gathered dust until 1987, when Ganis’ former agent showed it to Barry Navidi. Navidi, fresh out of film school, had made one picture--an hourlong drama titled “Mrs. Corbett’s Ghost,” starring John Huston and directed by his son Danny, with financing from John Paul Getty III. “I liked him,” says Ganis, a compact woman with reddish-brown hair in a Shirley MacLaine do. “He was young, eager, enthusiastic, sweet.” She changed the title to “Divine Rapture,” and Navidi and his partner--a film-school classmate named Damien Burger whose father, a Swiss cigar magnate, provided their development money--tried to set it up.

In earlier years, they need barely have ventured past London. But shortsighted tax policy and overcautious banking practices had so hobbled the British film industry that the only sure way to finance a picture there was through credit cards. Pinewood, the once-great home of the Rank Organisation, was nothing but a four-walls studio, its soundstages rented out to the highest bidder. Twickenham, when Navidi and Burger had their offices, was mostly given over to television production, and Boreham Wood, the legendary MGM studio in Hertfordshire, was now a distribution center for a deep-freeze company. Navidi and Burger would have to go elsewhere.

At first they hoped to shoot it in Italy, with Isabella Rossellini and Ben Kingsley in the lead roles and a budget in the $5-million range. Kingsley dropped out and Ron Silver dropped in. Their Italian investors dropped out because Navidi wouldn’t make it in Italian. Telly Savalas wanted to star, but only if he could move it to Greece. Richard Lester urged them to move it to Ireland--a hot country after “The Crying Game,” with a government-sponsored fund ready to put in 20% of the budget.

Four rewrites later, with Miranda Richardson and Albert Finney attached, Navidi went shopping for a deal in Hollywood. The studios expressed interest but didn’t bite. A private investor was set to finance it but pulled out at the last minute. In the summer of 1994, with the Irish weather too unpredictable to allow shooting until spring, the project was shelved for another year.

That fall Navidi’s agent, Dennis Selinger of International Creative Management, invited him to a dinner party at the Ivy, a clubby West End restaurant that’s popular with London’s theater set. Navidi found himself chatting away with Belinda Frixou, Marlon Brando’s attorney. A few days later, she phoned him to say that Brando was interested in playing Father Fennell, the priest who witnesses the miracle. He sent her the script, and one morning last November Brando rang him up at home and told him he wanted to do it. For Navidi, it was a peak moment.

With Brando on board, the picture Navidi had been unable to set up at $5 million suddenly ballooned into a $10-million production. Still, Navidi was on a roll. By early January, Debra Winger had committed to play Mary, the woman who dies, and Navidi’s friends were asking how he’d done it. But he still lacked financing, and when he got to Los Angeles he discovered that having Brando and Winger attached was not necessarily a plus.

He was told that Brando was difficult to work with, that Winger was a notorious troublemaker. Meanwhile, Frixou wanted a quarter of Brando’s $4-million salary put into escrow immediately. Navidi had been making the rounds, but half the studios said no and the rest were in no hurry to decide. He felt like he had a gun to his head. He called Mark Crowdy, an actor he’d met in London.

Crowdy was in Beverly Hills when Navidi called, and he had just the person to talk to--his old friend David Lowe, now in president of CineFin. That Friday the three of them met at CineFin’s offices in Orion’s Century City headquarters, and on Tuesday Navidi went back to sign a contract. There he met a David Williams, who was supposed to provide the prints and advertising funds, and Fred and Richard Greenberg, who were introduced as consultants. Unknown to Navidi, the Greenbergs had been in trouble with federal authorities since 1989 for banking improprieties and were barred from the banking industry in 1991.

“I had no idea who they were or what their background was,” he says now. “I was incredibly happy.”

The deal called for profits to be split 50-50 between CineFin and Touchwood Films, Navidi’s partnership with Damien Burger. Orion would provide North American distribution, CineFin would provide all financing and handle foreign sales, and Touchwood would arrange for a completion bond--insurance in case the production went over-budget--and deliver the finished picture. But a snag developed almost immediately: Brando’s escrow. CineFin was prepared to put up only the standard 10% on signing--$400,000, instead of the $1 million the actor wanted.

This time, Crowdy rang up Kristi Prenn, widow of electronics entrepreneur Daniel Prenn and one of the wealthiest women in Britain--or not in Britain, since she’d exiled herself to Monaco. Prenn had never invested in a film before, but she was going to London for a charity ball and she agreed to meet Lowe at his flat in South Kensington. Forty-eight hours later, she agreed to put up the full $1 million for Brando and $100,000 for Johnny Depp, repayable on the first day of principal photography. Her profits would be split between a clinic in India she supports and an Indian village that needed wells and a sewer system.

Prenn, a woman of many enthusiasms, set out to make “Divine Rapture” a household word. She persuaded the Harkness Nurseries, one of England’s finest, to name a new rose after the film. She arranged for a foal to be named Divine Rapture as well, sired by Pursuit of Love out of Pillowing.

Meanwhile, Navidi and Burger and Thom Eberhardt, a journeyman director whom they’d hired on the basis of the Sherlock Holmes spoof “Without a Clue,” went to Ireland to scout locations. They settled on Ballycotton, an old but none-too-quaint fishing village in County Cork, and hired a crew to build sets.

Yet even now, the odds were against them. “I had my doubts it would happen,” says Brando’s agent, Ed Limato. When Brando’s daughter Cheyenne committed suicide in April and Brando went into seclusion, nearly everyone wrote the project off. Only Navidi continued to believe.

“Barry was unsinkable,” recalls Thom Eberhardt, lounging by the pool behind his storybook fieldstone house in Glendale. “I’d never met somebody so full of can-do spirit with nothing to base it on. He wanted this picture to happen more than anything else in the world.”

But Eberhardt was eager as well. He saw the picture as Capraesque, a fable about miracles and faith and belief in oneself, and he bought into it against his better judgment.

“Everybody wants you to be passionate,” he declares as he heads into the kitchen for a beer. “You’ve got to want to do this more than anything in the world. That’s how you continually get beat up, when you allow yourself to get worked up over something. But this project--I was getting very excited about it.”

The willingness to believe: That’s what “Divine Rapture” was all about. The story opens with Mary (Debra Winger), frustrated with her marriage and her dead-end job in a lingerie factory, apparently dying while making love to her husband. He doesn’t notice. When she revives during her wake, Father Fennell (Marlon Brando) proclaims it a miracle. She produces more miracles on demand, rejecting the factory-owner’s plea for an endorsement (“Saints don’t endorse bras and girdles”) and embarking on a purification ritual of fasting, celibacy and jogging. Finally, she collapses a second time outside the parish church--only to have the village doctor (John Hurt) revive her with a bucket of cold water--as an angel seems to appear overhead.

To the people of Ballycotton--where the high point of most summers is the annual cow-pat competition, in which a cow is put in a field marked off in squares and people bet on where it will let loose--the arrival of an English film crew and several Hollywood movie stars was itself something of a miracle. To the Irish papers, it was front-page news; for the Ministry of Arts and Culture in Dublin, it was the latest vindication of a tax policy which had led to the completion of 20 films in Ireland the year before. But while “Divine Rapture” promised to pump some $4 million into the local economy, CineFin had yet to start funding it.

Navidi and Burger were hired producers now, yet CineFin’s requests that they defer their fee and keep financing the production struck them as plausible. The company’s financials looked healthy, and if the two most powerful agencies in Hollywood--Creative Artists Agency, which represents Winger, and ICM, which handles Depp, Brando and Navidi--thought it was OK, what did they have to worry about?

In fact, both CAA and ICM seem to have had their doubts. But the standard approach when negotiating star contracts with unproven production outfits is to get the salary put into escrow, and that’s what both agencies did.

Brando’s attorney insisted on using Brando’s own escrow company, and Depp was taking so little for the privilege of working with Brando that escrow was beside the point. But CineFin agreed to put up the money for Debra Winger and for Thom Eberhardt, provided they use CineFin’s escrow company--Capital Crest Financial Escrow Management, headed by one Roger Mathews and located at 3900 Alameda Ave., 17th floor, Burbank.

The building at 3900 Alameda Ave. is a sparkling new high-rise just around the corner from the Warner Bros. lot. Its prime tenant is the Walt Disney Co., but the 17th floor is used as a mail drop by less-established enterprises; in business lingo, it’s a parking lot. As for Capital Crest, it had been registered with the Los Angeles County Clerk’s Office in June 1994 as a fictitious business name for J. David Williams, chief operating officer of CineFin and the man responsible for raising the escrow funds.

In May, Brando emerged from seclusion to say that he was going to make the picture after all. With pre-production well underway in Ballycotton and three other films in the works, CineFin made a splashy debut at Cannes. But while David Lowe made a concerted--some later said desperate--effort to sell foreign rights, the major territories went unsold.

The next step for CineFin was to get a bank loan and start cash-flowing the picture as promised. CineFin had made funding arrangements with FILMS, a London firm that packages loans for Berliner Bank in Germany. Because the pre-sales hadn’t gone well, however, Lowe asked for a guarantee from Orion, which had agreed to pay 20% of the production budget for North American video rights. Unfortunately, Orion was just emerging from bankruptcy, so its paper wasn’t fully bankable. They could get a guarantee from Metromedia, Orion’s major shareholder--but Orion refused to go to Metromedia until CineFin showed itself capable of funding the picture. CineFin was missing a critical piece of the jigsaw puzzle, and without it neither the bank loan nor the completion bond could move forward.

“This is the stage at which I was getting hysterical,” says David Lowe, speaking by phone from his offices in Paris. “I was saying to the Greenbergs, ‘Where are all these supposed investors? We need some equity! You’ve been promising it--where is it?’ Then I came to the conclusion that there were no investors--that they were probably figments of the Greenbergs’ imagination.” (The Greenbergs did not return phone calls for this article.)

Alarm bells were sounding in London and Beverly Hills as well.

“I said, ‘I don’t see how you can start shooting without a completion bond,’ ” says Dennis Selinger of ICM. “But David Lowe kept saying that it was going to be all right, that it was just a question of getting Orion to sign some bits of paper. And I don’t think anything in the world would have made Barry think it wasn’t going to go.”

At this point, Navidi and Burger had already invested $500,000 in pre-production, most of it from Burger’s father. Brando was set to fly to Australia in August to star in “The Island of Dr. Moreau.” And statements from the Bank of America showed the escrow accounts to be in order; why would CineFin risk all that money? So the cameras rolled on July 10, even though FILMS had not yet gotten the paper it needed to begin due diligence on the loan, even though Film Finances, the company that was to supply the completion bond, had yet to receive its fee. The entire production was proceeding on faith.

The first week of production was heady and chaotic. Brando moved into a 12-room Georgian mansion at $4,800 a week while its owner lived in a trailer on the grounds. It rained every day. Navidi looked around and thought, I’ve done it! But no money was forthcoming from CineFin--not for the cast, not for the crew, not for their suppliers, not for the townspeople who were giving them bed and board and turning over their shops and fishing boats for the shoot.

When Kristi Prenn showed up with a basketful of Divine Rapture roses and Navidi suggested that she take over the production, she seemed interested. When David Lowe arrived, he seemed interested as well. That’s when Navidi got really worried. While the producers huddled with Lowe and Prenn in a smoke-filled room in the Bayview Hotel in the center of town, Thom Eberhardt tried to ignore the rumors and shoot the movie.

At the end of the week, Winger told Navidi that she knew he had financial problems but she wasn’t going to back out--even though she hadn’t been paid. Navidi was stunned: Winger should have gotten $250,000 from her escrow account with Capital Crest the day they started shooting.

When Brando’s second $1-million paycheck failed to arrive on Monday, it was clear there were real problems. Navidi summoned the cast and crew and announced that they were temporarily suspending production. Jeff Berg, ICM’s chairman, swung into action in Los Angeles, working furiously to close the breach between CineFin and Orion. Winger and Hurt spoke with Brando, and by Tuesday evening he’d agreed to go back to work while the financing was straightened out.

By now it was obvious that CineFin wouldn’t be able to finish the picture. But with the cast they’d assembled and the footage they had in the can, it seemed inconceivable that someone else wouldn’t pick them up. Kristi Prenn seemed eager to step in with bridge financing, and talks were underway with Miramax and New Line Cinema. Confident they’d have a deal within a week, Navidi mortgaged his London flat and used the money to keep them going.

Lowe left for London. Prenn was holed up in the Bayview Hotel with her advisors.

A few days later, a fax arrived from Los Angeles: Orion had issued a quit claim, giving up its rights to the property. Prenn held it up triumphant. Gentlemen, she cried, we have a picture!

Navidi was still elated when he was awakened by a phone call early the next morning. It was Rick Nicita of CAA. Winger’s attorney, Barry Hirsch, was on the line as well. It was Friday evening, Pacific time.

Nicita declined to comment for this story. But as Navidi recalls it, the first thing Nicita said was, Barry, you know Debra hasn’t been paid. Then he said to Hirsch, Barry Navidi is the victim in all this.

What’s going on? Navidi wanted to know.

Nicita was blunt: There is no escrow company. There is no escrow account. There is no money.

Navidi was stunned. What? Am I in a nightmare?

“I felt like somebody had pushed me from an airplane at 30,000 feet without a parachute,” Navidi says now.

“The neat thing,” says David Williams over lunch in Beverly Hills, “would be for everybody involved in this picture to get their money back.” Williams is propriety personified, an impeccably groomed young man in a somber double-breasted suit and a starched white shirt with monogrammed cuffs. Aside from Orion, whose delays he says caused the bulk of the problem, he blames the collapse of the film on Roger Mathews, the elusive president of Capital Crest. “When the film fell apart,” Williams says, “he said we’d breached an agreement with him and pulled all his funds and literally disappeared.”

Stephen Marks can attest to that. Marks is an attorney for Brownstone Financial, a West Los Angeles lending institution that filed suit against CineFin and Williams in September, alleging that it had put up more than $1 million in escrow funds for “Divine Rapture” and three other CineFin projects and that the money had never been returned. And as for Roger Mathews--”Is there such a person?” Marks asks. “I don’t know. I can only tell you that according to Mr. Williams, Mr. Mathews has disappeared off the face of the Earth.”

“The story I was told,” says David Lowe, “is that the escrow company--what was supposedly an escrow company, Capital Crest, which was in negotiations with David Williams, with which he said he’d done business before--said to him, ‘This is a great business, we want some of it. If your people put up part of the escrow, we’ll put up the rest.’ But. . .the end of the first week came and the drawdown was called for and we still had not been funded via the banks. . .”

Lowe says that he’s never met Roger Mathews either.

Unfortunately for Navidi, the discovery that the escrow accounts were not funded had an immediate and electrifying effect in Ballycotton.

“When something like that happens,” says Crowdy, “everybody starts running.” Kristi Prenn, Miramax, New Line--suddenly, it was as if the room had cleared and gusts of wind were blowing through the open windows.

At this point the lawyers have taken over. CineFin has filed suit against Orion. Orion has filed a counterclaim against CineFin. The U.S. Attorney’s Office is said to be conducting an investigation. The question none of them can answer is, how long before it happens again?

The decline of foreign cinema and of Hollywood independents like Hemdale, untrustworthy as it may have been, leaves more room than ever for fly-by-night operators with more guile than cash. Still, film people prefer to remain optimistic.

“There are a lot of these deals floating around the world,” says one seasoned executive. “But mostly they’re just talked about. You never get people standing around with cameras.”

Navidi wonders. He was talking with a friend the other day, a friend who’d just finished shooting a $15-million picture and had much the same experience--the same problems with cash flow, the same hang-ups with the bank loan and the completion bond. Meanwhile, the Greenberg brothers were said to be back in business a month later, interviewing for a new production chief out of offices in West Los Angeles.

“We were naive,” Navidi admits. “We took a chance--going after Marlon, going after Debra. But nobody got hurt. Nobody got killed. I did my job.” He heaves a sigh and looks up from his coffee.

“And after all, it’s only a movie.”