Tae-Bo Infomercial Kicks Up Success--and Legal Disputes

SPECIAL TO THE TIMES

Less than a year ago, Billy Blanks was a $70-an-hour personal trainer with a growing celebrity clientele--not exactly a rare job description in Los Angeles.

Today, thanks to the power of video and an oft-aired TV infomercial, Blanks is on the verge of becoming the most popular fitness guru since Jane Fonda.

Even as the 43-year-old sometime B-movie star has made an amazing sprint from obscurity to national renown over the last seven months, his success has spawned a legal war among past and present business associates over the Tae-Bo infomercial--along with a lawsuit from boxing legend Sugar Ray Leonard, who contends his name was used without permission.

The Ohio-based marketer behind Tae-Bo, meanwhile, is the subject of a federal criminal investigation in connection with another one of its infomercial products, a barbecue grill igniter that was advertised as a $79 health device that could cure arthritis and menstrual cramps.

None of those controversies has dampened spectacular sales of the series of videos based on Blanks' Tae-Bo exercise regimen--an energetic mix of tae kwon do, boxing and aerobics. The videos became a surprise top seller in infomercial spots and retail stores starting last fall, selling an estimated 1.5 million video sets starting at $39.

The muscled martial arts expert just signed a book deal worth a reported $1.5 million with Bantam Books, appeared recently on "Oprah" and an episode of "E.R." and is preparing 24 more tapes for release this year.

"It's a blessing," Blanks said several times in the course of an hourlong interview at his studio in Sherman Oaks, where classes have become so popular that visitors are sometimes turned away from the facility's jammed parking lot.

Blanks presents himself as the redeemer of a tainted industry. "Most infomercials are cheesy," he said. "People are looking for the truth. . . . Tae-Bo has so much to offer. I truly believe it's the exercise of the new millennium."

Blanks and his representatives declined to discuss the financial and legal disputes. Steve Dworman, publisher of Los Angeles-based Infomercial Marketing Report, an industry newsletter, said such imbroglios are not necessarily rare in the world of infomercials, where program-length ads breathlessly hawk everything from snoring remedies to get-rich-quick schemes.

"Whenever you have a business where anyone can go from being a pauper to a millionaire in a few weeks--when you hit that fast and that hard--people get greedy," Dworman said. "And there are no business systems or practices in place [within the industry] to handle what's happening in a businesslike manner."

"It's like the Wild West," said Seth Ersoff, an entertainment manager and former Blanks associate who is suing for what he describes as his share of the tens of millions of dollars in proceeds from the Tae-Bo videos.

For the right product, at the right time, the jackpot from an infomercial can be huge. But the risks are equally large. Producing an infomercial such as the one for Tae-Bo can easily cost several hundred thousand dollars. Buying TV time is expensive--a half-hour spot can cost as much as $50,000 on cable networks--and unpredictable.

The Tae-Bo marketers are shelling out an estimated $1.5 million a week on TV time, Dworman said, without any guarantee that their spots won't end up running during, say, a sudden national crisis when everyone is glued to CNN.

For the video industry, Blanks' triumph is astonishing. Exercise videos, which Jane Fonda helped turn into a profitable fad during the aerobics-crazed 1980s, were in steep decline until Tae-Bo came along. Such tapes sold fewer than 9 million units in 1996, down from 10.5 million units two years earlier, according to VideoScan, which tracks sales data in retail stores.

Tonya Bates, general manager of VideoScan, noted that Tae-Bo is now ranked third on the firm's overall chart, outselling recently released studio movies such as "City of Angels." Tae-Bo has also been a top contender on charts compiled by Billboard, Amazon.com and Jordan Whitney Inc.'s Greensheet, which ranks infomercials by ad budgets and TV exposure.

The media exposure has catapulted the Tae-Bo video to gross sales of about $75 million so far. Blanks' friends said that is simply due to the strength of the product. By adding kick-boxing and martial arts to old-fashioned aerobics, Blanks found a way to invigorate a tired style of exercise. Viewers also seem drawn to Blanks--whose shaved head and chiseled features cut a striking figure--as a charismatic motivator.

Larry Hayes, owner of Ventura Distribution, which is distributing the Tae-Bo videos to retail stores, said the Tae-Bo makers made a brilliant strategic move by selling videos in retail stores while the infomercial was still getting heavy airplay.

Blanks said this overnight success was a long time in coming, and he is marketing himself, perhaps not surprisingly, as an underdog who beat long odds. According to his Web site, he was "born the fourth of 15 children to a hard-working but poor African American couple in Erie, PA" and in childhood suffered from dyslexia, an unspecified hip malady and innate "clumsiness."

He says he started perfecting Tae-Bo more than 20 years ago, adding martial arts and boxing moves as he danced around the house to the "Rocky" theme song. One goal, he says, was to find a way to get more women interested in martial arts. The Tae-Bo name was trademarked in 1982, he says, with a studio in Sherman Oaks following seven years later.

Blanks also claims on his Web site to have been the captain of the 1980 U.S. Olympic karate team, though representatives at both the USA National Karate-Do federation in Seattle and the U.S. Olympic Committee in Colorado Springs, Colo., confirmed that karate has never been an Olympic sport. (Blanks' attorney and manager did not respond to queries about the claim.)

In any case, Blanks forged friendships with celebrities such as Sinbad, Shaquille O'Neal and Carmen Electra, all of whom became Tae-Bo students, and he also appeared in "The Last Boy Scout" and a string of B movies ("King of the Kick Boxers"). But Blanks' career turned a corner a few years ago, when he met Paul Monea, an Akron, Ohio-based infomercial purveyor.

Monea was originally interested in promoting an exercise gadget called the Billy Bar, but Blanks said he soon persuaded Monea to back a series of videos based on Tae-Bo instead. Blanks persuaded several of his celebrity friends to deliver glowing on-camera testimonials--for free.

Those free endorsements, perhaps worth hundreds of thousands of dollars or more, may have helped Blanks cut his deal with Monea. According to interviews and copies of signed contracts obtained by The Times, Blanks is to receive a guarantee of $250,000 annually as long as the infomercial airs, plus 20% of the adjusted gross revenue from video sales.

(Because the average profit margin in the infomercial industry is about 12%, Dworman said, Blanks' cut will probably work out to roughly 2.4% of gross sales minus returns.)

Monea, in a brief phone interview, declined to discuss any of the specifics of the deal. "We like to stay in the background," said Monea, who is running the Tae-Bo operation through his NPC Marketing Corp. "We're just some little guys in Ohio. This is really Billy's story."

Monea headed Universal Management Services, a company which advertised and distributed the Stimulator, a gadget marketed on television as providing relief for headaches, back pain, flu and other ailments. Ex-daredevil Evel Knievel and actress Lee Meriwether offered on-air testimonials for the product.

The federal Food and Drug Administration concluded in 1997 that the Stimulator was in fact "an electric gas barbecue grill igniter outfitted with finger grips" and that the makers did not offer evidence showing the device was safe or effective. According to George Hughes, senior special agent at the FDA, the administration won a civil injunction halting the sale of the device, which remains the subject of an ongoing criminal investigation.

The Tae-Bo infomercial, meanwhile, has developed its own special set of problems. Sugar Ray Leonard, who has known Blanks for years, said he originally taped a free testimonial for his old friend but withdrew his participation after a dispute with Monea.

He filed suit against Monea in October, alleging invasion of privacy, after his name (but not the testimonial) was used in the Tae-Bo infomercial. "The kind of person Paul Monea has proven himself to be," Leonard said, "I don't want to be part of his world."

Leonard added that he still considers Blanks a friend, and his lawsuit, pending in Los Angeles Superior Court, does not name Blanks as a defendant.

Ersoff, who has managed entertainment ventures for Leonard and others, said that he introduced Monea to Blanks and that Monea has not paid him commissions due on sales of the Tae-Bo video. His claim, joined with Leonard's, is also pending in Superior Court.

Monea's attorney declined to comment on the lawsuits.

So far, Blanks is reveling in his newfound fame. As a legion of perspiring, mostly female students do Tae-Bo kicks in his Valley studio, he gamely fielded questions about his life, faith and philosophy. But when asked about his financial dealings, the much-blessed trainer quickly and politely brushed off the inquiry.

"I don't like to talk about money," he said with a smile.

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Power Sellers

Top exercise videos, ranked by cumulative sales from week ending Jan. 4, 1998, through week ending Feb. 21, 1999.

*--*

Release Rank Video Label date Index* 1 Billy Blanks' Tae-Bo Workout Ventura Dec. '98 100 2 The Grind Workout-Hip-Hop Sony Music May '95 56 3 Yoga Journal's Yoga for Beginners Living Arts Nov. '92 54 4 Denise Austin-Fat Burning Blast PPI Aug. '96 54 5 Denise Austin-Sizzler PPI Sept. '97 49 6 Kickboxing: Knockout Workout Anchor Bay Oct. '93 49 9 Total Yoga Living Arts Nov. '94 35 7 Denise Austin-Xtralite Aerobic PPI Nov. '97 32 8 Denise Austin-Hit the Spot/Abs PPI April '92 31 10 The Grind Workout: Fat Burning Groove Sony Music Oct. '97 30

*--*

* The index shows that for every 100 units of "Tae-Bo" sold in the period, 56 units of "The Grind Workout-Hip-Hop" were sold. Actual sales figures are not released.

Source: VideoScan

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