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by James B. Stewart

Hardcover, 572 pages, Simon & Schuster, List Price: $29.95 |


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Book Summary

The Pulitzer Prize-winning author of Den of Thieves draws on extensive research and hundreds of interviews to document the fierce executive battle for control of the foremost entertainment company, in an account that discusses how Michael Eisner lost his chairmanship and how the conflict reflects modern-day American capitalism and popular culture. 250,000 first printing.

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Excerpt: DisneyWar


Simon & Schuster

Copyright © 2005 James B. Stewart
All right reserved.

ISBN: 0-684-80993-1


Roy E. Disney pulled his red 1999 Ferrari into the parking lot of the Bodega Wine Bar in Pasadena. It was late on a Thursday afternoon, November 20, 2003, just a week before Thanksgiving. Roy loved the Ferrari, one of the few conspicuous indications that the modest, unassuming seventy-three-year-old nephew of Walt Disney was one of America's wealthiest men. The car stood out in the Disney parking lot, where Roy had a space near Michael Eisner, Disney's chairman and chief executive. Because of the car, everybody knew when Roy was at company headquarters.

Roy hated the "Team Disney" building designed by noted architect Michael Graves at Eisner's behest to serve as the Walt Disney Company's corporate headquarters. Though the monumental facade was leavened by bas-reliefs of the Seven Dwarfs in the pediment, Roy felt the building represented everything that was bloated and pretentious in the company that Eisner had created. As he did from time to time, Roy wondered what his uncle Walt would have thought. Walt's office was still there, in the modest old animation building. Eisner had used it as his own office before moving to the new headquarters. Now Roy had moved into it, preferring it to the Team Disney building, so barren and vast that he joked he had to leave a trail of bread crumbs to find his way out.

In recent months Roy's physical separation from Eisner and other top executives had become more than symbolic. Even though he had brought Eisner to the company almost twenty years ago, he now felt deceived and betrayed by him. Eisner had come to Disney after a dazzling career in programming at ABC and in movies at Paramount Pictures. But Roy now attributed Eisner's earlier great successes to his partnerships with others: with Barry Diller at ABC and Paramount; with Frank Wells and Jeffrey Katzenberg in the early, amazing years at Disney. Since Wells's tragic death in a helicopter crash in 1994, and Katzenberg's acrimonious departure soon after, responsibility for Disney had been Eisner's alone. In Roy's view, the results had been disastrous. As the financial performance and creative energy of the company ebbed, Eisner had clung to power with a King Lear-like intensity, convinced that he and he alone had the creative instincts and managerial skills to shepherd Disney into a twenty-first-century world of giant media and entertainment conglomerates. Indeed, Eisner claimed the mantle of Walt himself, appearing each week on TV screens in the nation's living rooms as host of "The Wonderful World of Disney," just as Walt had.

In this respect, Roy felt that Eisner was only the latest in a series of pretenders to the throne Walt had occupied. Why was it, he sometimes wondered, that so many people wanted to embody Walt? Nobody went around Hollywood claiming to be Louis B. Mayer or Cecil B. DeMille. What gave people the illusion that they could fill Walt's shoes? First there had been E. Cardon Walker and Ron Miller, Walt's son-in-law, who, as Disney's chairman and chief executive, had constantly invoked Walt's memory. Then it was Jeffrey Katzenberg, who claimed Walt's legacy as head of the Disney studio. They had gone too far; Roy had to step in, and they were replaced. Now Eisner was overstepping the bounds.

Roy didn't claim to be Walt, but if anyone was entitled to the legacy, it was he. He was the one paraded before the world as the embodiment of the Disney Company and what it represented, the last company official bearing the Disney name. Just a month earlier, Eisner had publicly praised Roy's efforts on behalf of the company at the grand opening of "Mission: SPACE," the new attraction at Walt Disney World, which had drawn big applause. Crowds always seemed to respond to Roy, perhaps because, at age seventy-three, he bore such a close physical resemblance to Walt. But Eisner's public praise masked a mounting private hostility. When Eisner's wife, Jane, passed Roy and his wife, Patty, shortly before Eisner's speech, they had pointedly ignored each other.

Roy had long ago stopped attending Eisner's weekly meetings with top executives, or the lunches where he had once kept Roy informed of company plans and strategy. Roy had stopped trusting Eisner after he learned that Eisner had planted a spy next to him in the animation department to report on everything Roy said or did. They had avoided contact at the recent New York premiere of Brother Bear, the Disney studio's latest-and in Roy's view, mediocre-animated feature. Worst of all, when Roy's mother, Edna, and Walt's widow, Lillian, had been posthumously honored at that year's Disney Legends awards, and Roy accepted on the family's behalf, Eisner hadn't shown up. It was the first time Eisner had failed to attend the event, and soon after, word circulated within Disney that the company's chairman and vice chairman were no longer speaking.

Roy wasn't looking forward to the drink he was about to have with John Bryson, chairman and chief executive of Edison International, the parent of Southern California Edison. Bryson, who'd joined the Disney board in 2000, was chairman of the powerful nominating and governance committee. Roy rarely spoke at board meetings. But his ally, business partner, lawyer, and fellow board member Stanley Gold more than made up for his silence. For years, Gold had been sharply critical of Eisner's management and the financial performance of the company. But his comments at board meetings had fallen on deaf ears. The directors seemed to support Eisner blindly. Those who didn't, such as Andrea Van de Kamp and Reveta Bowers, had been purged, a warning to others of the perils of dissent. Roy was especially suspicious of Bryson, an Eisner loyalist who had first displaced Gold as chairman of the governance committee, and then voted him off the committee altogether.

Beginning the previous September, Gold had issued a series of letters to his fellow board members that were harshly critical of Eisner's performance and compensation. He and Roy thought it would be more difficult to ignore comments in writing, and they wanted to make their views perfectly clear. Most recently, Gold and Roy had opposed Eisner's latest compensation package, which awarded him a $5 million bonus in a year in which the company's operating income declined 25 percent and the company's shares hit a new fifty-two-week low.

Bryson had called Roy a few days before. "I need to talk to you," he said, and insisted they meet somewhere they wouldn't be seen. Roy agreed, though he thought the tone of Bryson's voice had a "mortuary quality" to it. He feared that the Eisner loyalists were going to try to purge Gold. The atmosphere at recent board meetings had been increasingly tense.

"How can I protect him?" Roy wondered about Gold as he walked into the bar. He couldn't understand why the rest of the board would want to cut off the last remaining voice of dissent.

As soon as they ordered their drinks, Bryson dispensed with small talk and got to the point.

"You know, Roy, you're past the mandatory retirement age," he said.

Roy was taken aback by Bryson's directness, and murmured something noncommittal. Yes, technically he was, since the retirement age was seventy-two, and he had turned seventy-three. But it didn't apply to board members who were also part of management, and he was the head of animation. Disney was famous for the longevity of many of its employees.

"The committee has met," Bryson continued, "and Tom Murphy and Ray Watson are going to step down." Murphy, the former chairman of Capital Cities/ABC, had joined the board after Disney acquired ABC in 1995; Watson, Disney's chairman before Eisner's arrival in 1984, was, after Roy, the board's longest-serving member. Both were over seventy-two. Roy wasn't surprised, since they had mentioned to him their plans to retire.

"We've concluded that you shouldn't run for reelection," Bryson said.

Roy looked at him in stunned disbelief. He was speechless. He felt like a knife had been stuck into his heart. It had never crossed his mind that the board would go this far. It wasn't just that he was still one of the company's largest shareholders. He had given fifty years of his life to Disney. He was the only direct link to Walt on the board. Walt had told him stories and fairy tales and read "Pinocchio" to him as a child. Together with Walt, Roy's father had created this company.

There was an awkward silence. Finally Bryson said, "I had to tell Warren Christopher the same thing," referring to Bill Clinton's former secretary of state, who had reached the mandatory retirement age while a member of Edison's board.

"Good for you," Roy said.

"Of course, you can be an honorary director for life," Bryson said. "We'd still like you to show up at the parks, at special events ..."

Roy cut him off with a laugh. So they still wanted to parade him around like one of the Disney costumed characters. It was insulting.

There was another awkward silence. No doubt they thought he'd go quietly, retreating to his castle in Ireland or his sailboat to sit out his retirement years. But despite his age, he felt a surge of energy and determination. Roy had been underestimated all his life. It had happened before. It was not going to happen again. He had only one thing left to say:

"You're making an awful mistake," he said, looking directly at Bryson. "And you're going to regret doing this."

Then he got up and walked out.

It is late May in central Florida, a brilliant, clear day. Though it's only ten in the morning, the mercury is climbing into the nineties and the humidity is just as high. It doesn't take much imagination to believe that Disney's Animal Kingdom, one of four theme parks that constitute Walt Disney World, is actually located in tropical Africa.

Goofy is standing just outside the park fence, ready to make an appearance. Just as tourists on safari in Africa hope to spot one of the "Big Five" game animals, visitors to the Animal Kingdom look for Disney's "Big Five"-Mickey, Minnie, Donald, Pluto, and Goofy, the biggest celebrities in the Disney pantheon, and the most coveted autographs. Goofy is a dog, of course, with fur, a long snout, floppy ears, a slight potbelly, and big paws. He's also the tallest of the characters, standing over six feet, and on this day he is dressed for the Animal Kingdom. He has on a big safari hat, hiking shoes and socks, lime green shorts in a dinosaur print, a bright red-checked shirt and suspenders, and a khaki neckerchief.

What many people don't realize is that Goofy's eyesight isn't all that good. Those long ears obstruct his peripheral vision, and the oversized nose further limits his view. What he can mostly see is the ground around his feet. Fortunately, Goofy has two human handlers to guide him into the park. They open a door and gently push him forward. He has to duck to get through. Goofy can't really tell where he is, but he hears the murmur of voices in the distance. He's nervous, and he can feel his heart beating. Only seconds have elapsed when he hears: "There's Goofy!"

He hears more children's voices and he sees several running toward him. Goofy waves and demonstrates the "Goofy walk," the silly lope that is one of Goofy's hallmarks. The children love it! More are running over, and their parents are starting to catch up. Suddenly Goofy sees a young girl closing in on him. She looks about five or six, and seems a little apprehensive. As she gets close she shyly extends an autograph book and a pen. Goofy clumsily grips the pen with his paw, and manages to sign the open page, carefully making the backward f that always shows up in Goofy's signature. What a relief, really, that dogs can't talk.

"Hug Goofy!" an adult voice cries out. The young girl looks a little wary, but Goofy extends his arm, and she slips in next to him. He gives her a gentle squeeze. Then, for a moment, Goofy gets a clear look at the little girl's face. The shyness melts away, her eyes widen in delight, and her face glows. She leans in and plants a kiss on Goofy's nose.

Flashbulbs are going off. Goofy wishes he could get his paw over to wipe the tears that have suddenly welled in his eyes. Or maybe it's perspiration.

* * *

The moment when a young child's apprehension vanishes, to be replaced by awe and delight, is what most Disney employees are talking about when they use the word magic to describe their work. It's why many come to work as high school or college students, and find they're still there twenty years later. Goofy, of course, is real. He was real for that young girl, and in that moment, he was real to me. I was no longer an author and journalist dressed in layers of padding and fake fur. I was Goofy.

Although it's a standard part of the orientation for top Disney executives to appear as a character in a theme park, only after I accepted the role of Goofy was I told I wouldn't be able to write about it, at least not in a way that stated or implied that Goofy was an actor inside a costume. People in charge of the theme parks had imposed this condition on the grounds that the illusion the Disney characters are real had never been publicly breached with the company's cooperation. At first I thought this was preposterous. This is about as credible as the existence of Santa Claus, and surely everyone above the age of eight or ten knows there are people inside these costumes. But the people who work in the theme parks insisted, and once I met them, I had a better understanding. Just about everything inside Disney World is illusion: prettier, cleaner, safer, better, more fun than the real world. It was Walt's genius to recognize that it is not only children who want an escape from reality. Like any good magician, you have to believe in the illusion, or it falls apart. It is a secular faith that has been embraced so passionately by so many Americans that the name Disney has become all but synonymous with an idealized American culture in which dreams come true.

Like many aspects of Disney, this changed in the tumultuous year and a half after I made my debut at the Animal Kingdom. After Comcast Corporation, the giant Philadelphia-based cable company, launched a hostile takeover bid for Disney in February 2004, Disney endured a withering barrage of publicity, and an article in The Wall Street Journal disclosed that top Disney executives had appeared in the theme parks dressed as Disney characters. With the cover blown to a national readership, Eisner agreed there was no longer any point in my pretending that Goofy was real, and agreed that I could describe my own character experience.

I had first met Michael Eisner many years earlier, before I was a journalist. In 1978 I was a young lawyer at Cravath, Swaine & Moore, a large New York firm, and Eisner was the president of Paramount Pictures.