A Woman of Independent Film Means

After 25 years of selling movie rights to markets around the world, Julia Palau has quietly emerged as one of the most powerful women in the independent film business.

Palau, majority owner and CEO of J&M; Entertainment, the London-based company she co-founded in 1978, is in the rare ranks of those movie executives who personally have the authority to green-light a slate of movies. Yet she is little known in the United States.

That may change as the company undertakes an aggressive shift in strategy from a seller of movies produced by others to a company spending about $200 million to fully finance eight films this year and as many as 10 next year.

She and her privately held company occupy a prominent place in the market surrounding the Cannes International Film Festival and in the independent film world.

Among the critically acclaimed films the company has financed are “What’s Eating Gilbert Grape,” starring Johnny Depp, and John Boorman’s “The General.”

The company’s upcoming films include Shirley MacLaine’s directing debut “Bruno,” Paul Schrader’s “Forever Mine” starring Joseph Fiennes, and Anthony Waller’s “The Guilty” starring Bill Pullman.

J&M; also continues to work in its traditional role as a sales agent and is co-financing a film version of “Dungeons and Dragons,” produced by Joel Silver.

The shift toward production for J&M; may be risky. Palau said the films, with budgets ranging from $7.5 million to $63 million, are financed so that even a massive failure of the slate wouldn’t endanger the company. Each film is financed individually through some combination of bank loans, insurance instruments, distribution guarantees, tax breaks and subsidies. In Britain, lottery money is sometimes used.

But her ambitious plans to build J&M; into a major European film company could be at stake.

None of the films J&M; is financing has yet acquired U.S. distribution and one recent production, “Letters From a Killer,” starring Patrick Swayze, ran into serious problems when Swayze broke both his legs. The banks financing the picture have demanded payment on an insurance policy protecting them from losses.

“There’s not much of the business we don’t know after 20 years,” Palau said confidently in an interview last week in J&M;’s penthouse offices at the Carlton Hotel overlooking the Mediterranean.

The offices, some of the most valuable office real estate along the Croisette where hundreds of large and small movie companies shop their wares, underscore J&M;’s status as one of the most solid of the international film companies.

Two years ago, the hotel manager came to Palau and said, “We have a problem. The president of France is coming and wants this suite.” Palau responded coolly, “What’s the problem?” The president got a suite a floor below.

Palau, 49, first came to Cannes as a part-time journalist and ad salesperson 30 years ago. She had dropped out of school at 16, the daughter of a successful whiskey salesman who later become chairwoman of liquor company J&B.;

In 1974 she joined Lew Grade’s film company ITC as a sales agent just as the international film business took off. She founded J&M; as an international film sales company with partner Michael Ryan, essentially serving as a middleman between producers and distributors in return for sometimes hefty fees. (Ryan is currently on a temporary leave from the company.)

In 1980 J&M; was one of nine companies that founded the American Film Marketing Assn. J&M; may be the only company surviving independently from that original group, having ridden out the booms and busts that characterize the movie markets.

Palau’s initial investment was “5,000 quid,” which they recouped on the very first film they sold, “The Stud,” starring Joan Collins.

Ryan and Palau operated as a sort of good guy/bad guy duo, according to those who have done business with them. Palau has a reputation as a no-nonsense executive and tough negotiator.

In an interview, Palau smiles easily and lapses into fond, sometimes raunchy, anecdotes about such stars as Jack Nicholson and Jamie Lee Curtis.

But her demeanor can suddenly become steely.

After describing the series of checks and balances within the company that underlie movie-making decisions, Palau notes that the final step is when she asks the sales staff to evaluate whether a film she wants to make can be financed.

Do they always figure out a way? “They’d bloody well better,” she says, eyes narrowing.

She says that she runs a “democratic company,” then corrects herself a moment later, describing her style as “benevolent fascism.”

While many women executives have had success in international film sales, only a few women in the world, notably Paramount chief Sherry Lansing and Columbia Pictures President Amy Pascal, can give a slate of movies the go-ahead.

But Palau appears uncomfortable when asked whether she brings something to her role that a man might not.

“I’m not that big on the whole woman thing,” she said. “You’re an individual.”

She does recall with amusement a moment in the 1970s when she was among the few women sales executives in the business. As she stood nearby, the head of a rival company jerked his thumb in her direction and told her boss, Lew Grade: “I got me one of those.”

“I was like a prize then, an accouterment,” she said.

J&M; has never had a breakout hit along the lines of Miramax’s “Pulp Fiction” or New Line’s “Austin Powers.” But Palau suggests that is a mark of the company’s strength, that it has been solidly profitable every year, building a 175-title library, based on the moderate success of many films.

Palau has flirted with selling the company and says she gets regular inquiries, but insists that J&M; is not now for sale.

Noting that Europe’s major entertainment companies are driven by television, she envisions J&M; as a major European company that is 100% based on theatrical films. She hopes to move into direct distribution in some territories, including potentially in the U.S.

J&M; has a small office in Los Angeles whose chief responsibility is developing material for films.

Palau said she believed the company had to move into production after “being on the top of the international sales heap for 10 years,” and finding it increasingly difficult to assure distributors a steady flow of good movies.

“Five years ago I was getting to the point that I was putting up 50% of the financing for films and I didn’t want to have to rely on third parties to get the projects done,” Palau said.

Palau is married to Bertil Ohlsson, one of the producers of “Gilbert Grape,” and has two daughters, ages 12 and 17.

“I’d never make “Natural Born Killers,” Palau said. “I believe we have a moral responsibility to the young.”

But she justifies the horror films her company distributes as “pure entertainment.”

“The key movie audience is males 15 to 25, and that’s just a fact,” she says. “We have to make films for them and for the lorry driver sitting at home on a Sunday night swilling beer and flipping on the TV.”