L.A. Law Hijinks

Dealmakers and former pals Ovitz and Burkle are suing for a piece of each other's action

In the latest twisted tale of Los Angeles dealmaking, lawyers for billionaire and former grocery store magnate Ronald W. Burkle and onetime Hollywood superstar agent Michael S. Ovitz are set to square off in court in February. They will be battling to dismiss dueling lawsuits in which the former friends accuse one another of reneging on agreements to invest together. It's Exhibit A for how business is sometimes done in Los Angeles, where handshakes often qualify as binding and egos crowd the details.

If the judge lets the lawsuits stand, a trial would most likely take place this summer and center on Burkle's charges that Ovitz failed to make good on a verbal promise to jointly invest in Internet ventures in the late 1990s and share in other investments. Ovitz denies there was ever a verbal agreement. But in a counter-suit, he says that if one did exist, then Burkle owes him, including money from Burkle's deals to get a beer distributorship for the Reverend Jesse Jackson's son and to help square away singer Michael Jackson's finances. A trial could set Hollywood tongues wagging much like Ovitz's other courtroom star turn in 2004, when shareholders sued over his severance after his departure as Walt Disney president (Disney won). Already, Burkle's lawyer, Patricia L. Glaser, says she may call folks from Ovitz's past "who have their own stories of betrayal."

Burkle, who filed his lawsuit in 2005, says Ovitz owes him $16.5 million from investments he promised to make in Internet startups such as Checkout.com and portal Talk City. So far, the fireworks have had a nasty Hollywood flair. Ovitz's lawyers tried to subpoena the divorce agreement from Burkle's former wife. Ovitz later withdrew the request and offered an apology. Burkle has claimed Ovitz hired notorious Hollywood private eye Anthony Pellicano to spy on him. Burkle says Pellicano later discussed the case with him at a poolside cabana. In court papers, Ovitz says Pellicano was an intermediary but wasn't hired to snoop. The P.I. is currently in prison awaiting the outcome of a federal wiretapping investigation.

The legal fisticuffs are a long slide for a friendship that began in the early 1990s when Ovitz helped new L.A. resident Burkle find a private school for his kids. Ovitz even asked him to speak at his son's bar mitzvah. Now, Ovitz's attorney Eric M. George says Burkle is "prosecuting claims that are as spiteful as they are bereft of merit."

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