It Will Never Happen

THERE HAS BEEN MUCH HOPE.
WELL, I’M SORRY TO BREAK IT TO YOU, BUT...

I post this bleak little essay only because I have grown weary of people writing to me out of the blue to inform me of the great news. I do not share their optimism.

If the video doesn’t display, download it.

A few years ago, my friend Alex Tuschinski posted the above video on YouTube, and then not long afterwards he took it down. Fortunately, I downloaded a copy. Here it is. As you can see, Alex had gathered every bit of Caligula footage that he could find from DVD supplements and alternative versions on VHS and so forth. With these in hand, he pieced together, purely as a personal experiment, a version in which he tried to approximate Tinto’s original intentions. He filled in missing scenes and missing dialogue with stills and captions. He privately showed the result to a few people back in 2013 or thereabouts, and it really surprised me. I wouldn’t go so far as to say that Alex’s Caligula was a good movie, but it was certainly hypnotic and engaging, far superior to any version ever released. It was amazing that a few small changes here and there, some of them lasting only a fraction of a second, could transform the wretchedly boring movie into something that would grip one’s attention. Alex had brought back a pleasing flow that was missing from all previous versions.

TO SET THE RECORD STRAIGHT: Alex’s video version of Caligula was NEVER shown publicly or commercially. Alex never made a penny on it. It was a private experiment, for his own research, nothing more.

He showed his little experiment to Tinto, who loved it. The two movie-makers were remarkably alike in their concepts and styles and anarchic sense of humor, and Tinto had full confidence that Alex would do perfect justice to the movie. He gave his blessings to Alex in advance. He was happy to leave the footage in Alex’s hands — provided, of course, that Alex would ever be able to get the footage into his hands in the first place. I, for one, was deeply impressed and proud of my friend. Tinto encouraged Alex to keep at it.

In order to keep at it, Alex proposed that we approach Penthouse about getting access to the vault so that the world could finally have a director-approved Caligula. I told him not to do that. I had dealt with Penthouse in the past, and that was not an experience I would wish on anybody. I explained that if he were lucky, Penthouse would just slam the phone down on him. If he were unlucky, he would be sued. A few weeks later he Skyped to say that he had contacted Penthouse, that the company had just been sold, and that he was now in touch with the new owner, Kelly Holland, who wanted to go ahead with a “director’s cut.” Utter disbelief. Something was up. What? Alex asked me where the film was stored, and I told him it was at Iron Mountain in Hollywood. I thought he had known that already. Anyway, I’m so glad he asked, and I’m so glad I told him, because Iron Mountain was preparing to shred and dispose of the entire contents for lack of payment. Had we approached Iron Mountain just two days later, it would have been too late.

In mid-August 2016, Alex phoned to say that he and Kelly had taken a quick look at the Caligula contents at Iron Mountain. Shortly afterwards, as I was in my supervisor’s office, my mobile phone rang. Normally I would have ignored it, but I saw that it was Alex’s number. I answered, but told him I couldn’t talk, since I was at a meeting. He kept his reply brief, and he spoke in hushed tones so as not to be heard by anyone but me: “Take Thursday and Friday off and come to Iron Mountain. Kelly wants us to look at the film in the vault.”

So that’s just what I did. The crew at Iron Mountain had gathered all 400 or so Caligula boxes from around the gigantic high-rise warehouse, and stuffed them all into a room off to the side where we could see everything at once. We were dumbstruck by what we witnessed. We spent two days arranging the heavy boxes into some sort of sensible order so that we could get a conception of what was in the collection. As far as we could discern, nearly everything that Tinto had shot was there, as well as nearly everything that Giancarlo Lui had shot for his 16mm promo film. Where negatives were missing, there were positives that could serve as substitutes. Many boxes were mislabeled and many cans were also mislabeled. When we thought we had found a long-lost item, we would open the container only to see that there was something else entirely inside. We found trims, outtakes, spares, mag-stripe production audio, ¼" audio reels of unused music (much of it terribly damaged), we found heaven only knows how many boxes of fullcoat post-sync reels (we did not dare open those boxes, because we did not want to touch or even breathe on the fullcoats), numerous duplicates, a b&w dupe of Russ Lloyd’s rejected version of the movie, and a box filled with deletions from Russ Lloyd’s cut — deleted at Jack Silverman’s orders, in case you didn’t know. (Those deleted sequences are all on the supplements to the Japanese and British “Imperial Edition” DVD’s, in which they are strangely referred to as the “North American Bonus Footage.” This material should have been on the US DVD set as well, but it was discovered in a NJ warehouse too late, just after the video masters had been finalized, and after the budget had been used up. As soon as the Japanese executives learned about this material, they paid to have it scanned.) We also found the footage (maybe 100') that Guccione ordered Russ to cut from his version to make way for the hardcore replacements. We found boxes and boxes and boxes of studio documentation, about 9,000 b&w stills (prints and contact sheets, but no negs), and countless other items. I had been under the impression that PH had retained only about 50 hours’ worth of selections of trims and outtakes, and that the rest had probably stayed in storage at Technicolor Rome, held there for the production company, Felix Cinematografica of Rome — until Technicolor finally destroyed the collection in August 1991 for failure of Felix to pay storage fees.

Wrong!

Felix had had only duplicates. (Well, Felix had also had the Italian dialogue masters, of course. Those are gone forever.)

All the originals, or nearly all the originals, were in Hollywood.

This was like finding Aladdin’s cave. It was beyond surreal.

We were able to sample the contents of only a small fraction of the crates. We did not have the time or opportunity or equipment to look through every last box and can, but I know you’re curious, and so I’ll tell you. We did not come across any of the 12,000' of the Guccione/Lui “additional scenes,” nor did we come across a copy of the movie that was any longer than the usual 156 minutes, though we did come across one small piece circumstantial evidence that there was once a padded version. Namely, we found a can of the Imperial Bordello that was labeled “With Gong.” Too cryptic for you? Please see “The Mythical 210-Minute Version,” which I had written several years prior to my admittance to Iron Mountain. So there.

A few days later, Alex introduced me to the Penthouse crew. I was apprehensive. I had never been a fan of Guccione or of Penthouse. I knew more than enough about Penthouse’s past and I did not wish to be Penthouse’s next victim. Nonetheless, once I met the crew at HQ in Chatsworth, I was startled to discover that I liked the folks there. They were entirely unlike the ogres I had encountered at Penthouse under previous administrations. These people were nice, easy-going, relaxed, subdued, professional, friendly. Then Alex introduced me to Kelly, and I liked her a lot. She is a good level-headed progressive who runs an animal-rescue ranch and who is actively pro-American Indian. She’s kind and generous and has a good heart. Simply put, I was stunned. This was absolutely contrary to my previous brief but unfortunate experiences with the company, but I was worried. Kelly was a huge Bob Guccione fan and thought the world of the man. I could not put forth a charade. I had to tell her the truth. I let her know that I had spent several years studying Guccione’s life and career and had found nothing to like at all. To my surprise, she was okay with that; she was open to dissent, and she was open to changing her mind. This was the rarest of people. How many people are open to changing their minds? She won me over.

She invited Alex and me to her annual Vice Is Nice party at her ranch. That was a fund-raising event for animal rescue, and that was surreal as well. Acres of land were filled with cars and the overflow was all double-parked along a long stretch of country road. Once inside the ranch grounds, we could purchase raffle tickets for various prizes, most of them dealing with domestic pets. I bought some tickets for cat food (and lost). Others preferred to buy tickets for sex toys or a novelty photo with a different sort of Pet. Around us there were logos boasting of some of the sponsors of this event, sponsors such as Vivid Video, the porn label. It was an interesting gathering, where I saw all manner of sophisticated people, the upper-crust, certainly, including an exceptionally talented magician who was acquainted with some of my friends. I kept several copies of the handsomely printed program, simply so that I could show them to anyone who may doubt my tale.

Not long after this fundraiser, Kelly had her crew apologize to me on her behalf when she needed to break an appointment. Why did she need to break the appointment? Simple: She had found an abandoned kitten on the highway and she wished to devote the evening to rescuing it. I was overjoyed. She was my type of gal, someone I could be proud to call a friend.

Kelly paid Iron Mountain to ship all the old Caligula-production paperwork to PH HQ and she handed me the key to the office, giving me permission to study and copy any of the documents we had discovered, anytime, day or night, whenever I had a few hours to devote to the project.

This seemed too good to be true. This plot device, if placed into a novel, would be rejected by any publisher as far too outlandish and a strain on credulity. Yet it happened.

In the meantime, there was a conversation at Cannes, and Kelly proposed that Alex be put in charge of the creation of a proper edition of Caligula. It was entirely unknown if Tinto would agree to work on it. After all, back when I interviewed him in 2004, I mentioned that Guccione had recently lost control of Penthouse and that there was a chance that the rushes were still in storage. He got a pained look on his face, turned away, and with his arms gave me a “keep-it-away-from-me” gesture. He said that he would not want to touch the film again. Enough was enough. He wanted to look forward towards the future; he never looked back at the past. I did get him to agree, though, that, at the very least, the footage should be housed in a proper archive. On the other hand, in his more recent conversations with Alex (an example of which opens this web page), he agreed that, theoretically, he would guide Alex in a new edition of the movie. What did he really want? What would he really want when/if the situation were ever to arise? Nobody knew. I am certain that Tinto himself did not know. Would he want to edit the film on his own? Would he want to supervise an editing crew? Would he want merely to allow someone else (Alex?) to do the first draft, which he could then tweak? Nobody knew. Kelly and Alex were prepared to honor any decision that Tinto would make. Unfortunately, what Kelly and Alex said was misunderstood by others as meaning that they simply wanted Tinto to affix his name to someone else’s version, which was not what they had meant at all. Whatever Tinto would decide, though, it was agreed that Alex would prepare the footage: scan it and then organize, catalogue, and index it to save Tinto from that burden. Kelly thought that she could easily raise the money to create a new edit of Caligula, but when I heard her estimate of the likely cost, I realized that she had grossly underestimated — about one-thirtieth of the reality. This project was in trouble and I could see that it would never be done. Yet I chose not to open my mouth, because I did not want to create a scene. Kelly and the others would simply need to learn on their own.

Then something else happened. Kelly hired me as a casual to become the company historian. That was, I think, in April 2017. She had been impressed by my knowledge and arranged for HR to bring me on staff. I warned her to reconsider. The story, I assured her, was not flattering. She was fine with that. Tell the truth, she told me. She was okay about coming clean regarding the company’s past. She especially emphasized her desire to publish the true story of Caligula, a movie that only Bob could have produced. My heart leapt to my throat. I was nervous as I told her that it was not Bob’s production. It was Franco’s production. Bob was an investor who drove Franco to bankruptcy and effectively stole the production. She was stunned for a moment, and then blurted out, “Well, that’s Bob!” She was okay with my telling the truth about that, too.

So I signed the employment papers, but once I saw the contract, I froze, for something was wrong. The contract had nothing — nothing — to do with my job description. It was a contract for computer-software development, and it had such strict non-disclosure stipulations that, had I signed it, I would have been forever silenced on the topic I had been hired to write about. I would not sign. That is when I met some execs at PH who got me worried sick. One particularly rancorous exec hated me from first sight, and quite vehemently. They presented me with rewritten contracts that were even worse, and that had many contradictory stipulations, along with a stipulation that any breach on my part would cause the company to sue me for damages. The problem, of course, is that merely by signing I would have been in breach. For instance, one section required that I help produce a series of coffee-table books on the company’s history. The non-disclosure agreement required that I never reveal anything about the company, past, present, or future, to anyone, publicly or privately. How could I possibly follow both guidelines? There was a separate non-disparagement agreement that would bind me never, publicly or privately, to say or write anything less than flattering about anyone who had ever been connected with Penthouse in any capacity. To have signed that would have doomed my ongoing book, and would also have contradicted the purpose of the books I had been hired to work on. I would have been happy to sign contracts binding me not to disparage the current management or staff, and not to reveal trade secrets, and I said so, but contracts that would forbid me from ever mentioning Penthouse’s history under the Guccione administration were absurd and unacceptable. The execs refused to budge. Ofttimes I could hardly get a word in edgewise before the execs would cut me off and talk right over me. It was impossible to have a serious discussion when dealing with that behavior. The contracts also had typical Guccionian loopholes that worked solely to my detriment, and solely to the company’s advantage. The language was deliberately vague, but I was able to untangle it. For instance, by my interpretation, these contracts would have allowed the company, without notice, to transfer copyrights to a different branch, against which I maybe could or maybe couldn’t make a claim for royalties, but the onus of discovering which branch now owned the copyright was entirely on me. If by some supernatural miracle I could figure it out, then PH would simply have transferred the copyright once again, to keep royalties forever out of my hands. Hadn’t I just written several chapters about this scam? And weren’t those chapters about the old days of Guccione’s Penthouse? I would not sign those contracts either, and the execs flatly refused to accept most of my handwritten amendments. Why couldn’t Kelly, the nominal owner of the business, order her executives to do as she wanted? Actually, she did order them to do as she wanted, but her order had no effect. I do not know, but my best guess is that, as she was overly leveraged, she was beholden to her mortgage holders, and thus had her hands tied.

I distrusted those execs entirely, and the more I had to interact with them, the more worried I grew. They were playing a game of good-cop/bad-cop, and I saw clearly that they were trying to set me up. It did not take a genius to recognize that there was a coup underway. I could discern that these execs did not have any particular animosity towards me. They just wanted to sue me into oblivion, or they at least wanted to drive me away. Why? Just to undermine Kelly’s authority. They saw me as nothing more than a way to get better aim at bigger game: They wanted to oust Kelly. I had no desire to stick around for the bloodbath. Finally, in late July, after months of these stupid games, I left. Gladly. And washed my shoes when I was gone. Unfortunately, I had to surrender all the copies I had made of documents in the paper archive. I made it clear to Kelly that I had no quarrel with her, and that I continued to admire her. Regardless of my kind feelings towards Kelly and the crew, I wanted nothing more to do with Penthouse, ever. I so much wanted to warn Kelly that she needed to watch her back, but how could I say that without sounding like a deluded troublemaker? I kept my mouth shut.

So it was too good to be true, after all. This was all to be expected, really, and, as you see, I had expected to be banished from the first day I was admitted. Business long ago declared scholarship to be the enemy. The hostility is palpable. PH was a business. Why should it be different from any other business? Despite Kelly’s aspirations for higher ideals, PH turned out not to be different from any other business. So what else is new? In nearly every job I’ve ever had, a sincere commitment to the business’s mission statement is a terminable offense.

What puzzled me, though, what what continues to puzzle me, is why these two execs wanted to oust Kelly. Surely, they did not want to run the business for themselves. There was no money in it, and these two execs were accustomed to living the good life, if you get my drift. They were the upper-crust country-club élite, and so they would not want to soil their hands with a cash drain. My impression was that they thought of Kelly as a mere commoner, one who was foolish enough to follow her passions, and to risk anything and everything to nurture something she loved. What I learned in my previous jobs was that any employee who showed passion, who showed a zest for life, who tried to smooth over problems and to help others in the office, would be smeared to kingdom come. The only interest that business execs have in such people is to make them the fall guys. In the PH case, the situation could not have been so basic, so simple. What was the goal? What was the motive? There must have been something else at play, a third party, a payoff, a secret mission, to do — what?

During all this trauma, my partnership with my coauthor of 200 Degrees of Failure: Caligula disintegrated. At more or less the same time, the November 2016 elections turned out exactly the way I had predicted. For well over a century there were only two viable political parties in the USA. Both were purchased long before any of us were born, and the USA became the government of Wall Street, by Wall Street, and for Wall Street. One of the two parties committed suicide back in the 1990’s, as I looked on in perplexed disbelief. (See this and this and this and this.) Now, in late 2016, the other party had just completed its 37-year-long process of eating itself away from the inside, right before my eyes. The USA was planted with terminator seeds, and now I was witnessing the peculiar spectacle of the entire federal government eagerly celebrating its own funeral to the accompaniment of Sousa marches. I am still astonished by how few people understand the gravity of this situation. We are on the brink of doom. In this milieu, a book on so frivolous a topic as Caligula no longer seemed to be a defensible undertaking. Making the situation infinitely worse, my cat died prematurely of a heart tumor. She was the only love of my life, ever, and I was, and remain, devastated. It would have killed me to work on the book anymore. I had to take a breather for a year or two or three before I could decide if I wished to rewrite it, all over again, yet again. It was so irritating to have a nearly completed book, and not be able to do anything with it.

A mere few weeks after all the PH drama, on 11 August 2017, I received a call from out of the blue. The caller had briefly been involved in Penthouse over 40 years earlier, and we had a nice long chat over the phone. He assured me that I was right not to have signed the contracts, and that I was right to have resigned. He told me that, despite the change of ownership, despite the good people involved now, “it’s still Penthouse!” The best thing anyone could do, he said, was to leave, immediately.

Alex was more fortunate. He was still welcome at HQ with open arms. The execs did not give him any troubles, and they tended to avoid him altogether. I can only presume that was because he did not pose a threat, since there was no possibility of his project going through. My guess is that the execs were happy to let Kelly waste her time and energy on a big bundle of nothing. The talks about the “director’s cut” of Caligula (or would it be the “Alex cut”?) continued, but only as talk. There was no money behind the idea. At the same time, some friends pointed me to articles in the news to show me that PH was failing and had filed for Chapter 11 bankruptcy. That did not stop Alex from announcing his new movie:

https://www.youtube.com/watch?v=-rzCj8jVeAA&t=23s

Though made with all sincerity as an informal documentary, the purpose, clearly, was to serve as Penthouse’s fundraising pitch. By the time Alex began to work on this little fundraising promo, I realized that the project was a lost cause. He interviewed Tinto, who was thrilled to be in it. Unfortunately, people in the legal profession were somewhat less thrilled. So every frame of Tinto’s interview ended up on the cutting-room floor. I’d like to scrape that footage up off of the cutting-room floor, but I don’t think I’d ever be allowed within a thousand miles of it. Alex asked if he could interview me. I said ABSOLUTELY NOT! He asked if he could talk about me in the movie. I said ABSOLUTELY NOT! I did not wish to be associated in any way whatsoever with Penthouse. And I meant it! I wanted to control this narrative. I did not want to be perceived as supporting PH in any way. Besides, I was certain that there would never be a restoration. Why pretend to be excited about a project that would never come to be? So, Alex, rightly, took credit for my research. He is welcome to. He is more than welcome to. With all my blessings. Besides, I learned as much from him as he learned from me. It’s an even trade.

TO SET THE RECORD STRAIGHT: Though this was a promotional work, Alex never made a penny on this movie. He made it without a thought of profit. It was a goodwill gesture, made in the hopes that Tinto would create or at least oversee a “director’s cut” of Caligula.

TO SET THE RECORD STRAIGHT: For those who argue that all the physical film needs to be sent to the director: There is no need to edit film anymore. Those days are over, and that technology is obsolete. Nowadays, the film is scanned, and the scans are edited on computers. A “director’s cut” can and should be created from the scans. Once the film is scanned, it needs to be put into a freezer and kept there. It should not be handled, cut, spliced, or viewed. It should only be checked periodically for signs of degradation.

So Alex completed the movie without me. As with anything Alex commits to video, it’s quite good and a lot of fun. Here is his full 39-minute promo:

https://youtu.be/i2PXmIVZx_M
Con sottotitoli opzionali in italiano.

Alex invited me to the première screening of Mission: Caligula, and so I applied for some vacation time (approved!) and made arrangements to attend. Then he said that the Penthouse people would be there, and I erupted like a volcano. I canceled my plans and told my employer that I was withdrawing my vacation request. So here is the after-screening discussion that I missed. That was in February 2018. My heavens! That was only a year and a half ago. It seems like 30 years ago!

https://www.youtube.com/watch?v=qNivWAJwmTk&t=23s
Here is the dialogue, translated into English as well as into something that I hope resembles Italian.
(If you do not see the document embedded below, please use a different browser or just open the file here.)

If you think any of these restoration plans would ever come to be, think again. Tinto has dreams. Alex has dreams. Kelly has dreams. I have dreams. Other people have dreams, too. For every dreamer, there is a battalion of anti-dreamers who are armed to the teeth. This is war, folks, and I’m staying as far from the trenches as I can possibly get. I don’t want to spend the rest of my days in court battling an endless series of lawsuits. After all I witnessed, I cannot possibly believe that there would or even could be a restoration under any circumstances.

Left to right: Kelly Holland, Alex Tuschinski, Timothy Driver, and Samantha “Sam” Phillips.
I have no idea who Timothy is. That’s Sam? I know Sam. That’s Sam? Huh? I did a Google image search, and yeah, I guess that’s Sam.
The photo comes from Mark Kernes, “Penthouse Event Previews New Version of Classic Film ‘Caligula’,” AVN: Adult Video News, 27 February 2018.

There’s more to the story, though. When Alex and I had spent those two days sorting through 400 heavy crushed cardboard boxes at Iron Mountain, we were both surprised to discover that most of the film elements seemed pristine, as good as new. We were worried, though, to discover a few rolls that were off-gassing badly. There was even a terribly rusty can that made me panic. I opened it to let the gases out and to let some air in, and discovered that there was a two-thousand-foot roll of rotted fullcoat inside. The gases that shot forth from that can nearly knocked me out cold. (I was relieved to see that the label indicated it was a dupe, not a master.) We told Kelly that the degraded film needed to be quarantined immediately, else it would destroy the entire collection. Remember, once even one single tiny little piece of triacetate stock exhibits hydrolysis, it infects everything else in sight, almost instantly. See “Vinegar Syndrome,” National Film Preservation Foundation, and “Vinegar syndrome,” AIC Wiki. The off-gassing rolls needed to be pulled away that very day, and the rest of the massive collection needed to go into cold storage THAT VERY DAY. That very day was two years ago. Yet nothing was done. I understand that PH recently (August 2018?) removed the collection from Iron Mountain, and so I do not know where the film is now. I would be surprised — delighted, but surprised — to learn that it is in cold storage, which is where it belongs. I have little hope of that, though.

You probably have no idea what on earth I’m moaning about. Fine. I can’t blame you for that. This is not common knowledge. So here are some images that I found on the web through a quick Google search, which illustrate the horrifying process of deacetylation — or hydrolysis, or vinegar syndrome, or acetate-film-base disintegration, or whatever term you happen to think is most euphonious. Click on any image to go to the full story.

This is what a can of 35mm film is supposed to look like.	Here is a reel of 35mm, maybe 18 minutes long, that has begun to off-gas. I’ve projected several films in this condition. They tend to break — a lot. They stink like all get-out, too.
A can with 16mm film that has just begun to go bad.	Not long afterwards, the film is no longer recoverable. This 1,000' roll of 35mm is beyond any hope.
A reel of 16mm film that will never be projected again.	35mm film that will never be projected again.
More 35mm film that will never be projected again.	35mm film that is near the end of its life, crumbling into poisonous dust.

So, not only are there no funds for a restoration, not only are there bureaucrats and lawyers who would fight to the death to prevent a restoration, there is also the matter of the source materials, which I can only assume are now beyond repair. Well, I tried. The good news is that the execs who gave me the heebie jeebies are gone, thank heaven! Why and under what circumstances did they leave? Who are their replacements? I do not know. I don’t think I would want to know.

I did not want to listen to “Special Report: Mission Caligula (2018).” I was sure it would get me down. Then an Aussie friend insisted that I listen to it beginning at about the 1:30:00 mark. I’m glad he did. Kelly gave a great interview. She says that there is a group that would like to come in to help with the restoration. Who is in this group? I do not know. Does the group have sufficient funds? I strongly doubt it. I cannot imagine any venture capitalist pouring $3,000,000+ into this project. Venture capitalists demand collateral, usually in the form of real estate, and they demand a minimum 700% return on an investment over a maximum of five years. I don’t see that happening. Also, Kelly kept mentioning 4K. That’s a good format for release, but insufficient for scanning. The scanning would need to be 5K, and it would need to capture the entire frame right out to the corners, with a hint of the black border surrounding it, so that framing adjustments could be made during editing. This isn’t going to happen. Who wishes to change my mind?

Assuming financing would be forthcoming — and it was hard to imagine that any financing at all would be forthcoming — was a “director’s cut” or “director-approved version” even a physical possibility? Could it have been accomplished? Probably, yes, probably, but the obstacles would have been massive. A large team of experienced top professionals working on the project for a year might be able to create something usable that could serve as the basis for such a “director-approved version.” Much of the sound would need to be recorded from scratch, and the remaining sound would need unprecedented amounts of filtering, cleaning, and synthesizing. New music would need to be composed and recorded. It would have been the most complicated, detailed, challenging film restoration ever attempted. Miraculously, there was a hint that such help just might materialize, because there was some enthusiasm about this project in professional circles! Then everything was scuppered.

Not long after the première screening of Mission: Caligula, there was more news. PH’s mortgage holder, ExWorks Capital of Chicago, sold its debt to a firm called Dream Media, for $3,000,000. Dream Media sold PH at a bankruptcy auction. “Public Notice of Auction of Assets: Penthouse,” DailyDAC: Distressed Asset Central, 21 May 2018. Don’t just read the opening sentences. Read all the way down to the bottom, and pay attention to the cartoon. (Oh drat. They took down the cartoon. I saved a copy, though.) PornHub, Hustler, and various other unidentified companies put in bids, but the winning bid, $11,200,000, was by WGCZ Limited of Prague. That drives me batty. Why on earth would successful companies place astronomically high competitive bids to acquire a dead business, a dead business that was effectively bankrupt, a dead business that had no following? What did this dead business have that the magnates so desperately wanted?

I had never heard of WGCZ. So I looked it up: Ben Woods, “The (Almost) Invisible Men and Women behind the World’s Largest Porn Sites,” Insider, 3 March 2016. What can I say?

To learn more about WGCZ and its group of associated companies:

WebGroup Czech Republic, a.s., D&B Business Directory

MindGeek S.a.r.l. et al v. WGCZ S.R.O. et al , Justia Dockets & Filings

Malorie Deborah Pacaud, Expanzo

Robert William Seifert, Expanzo

Hydrenta HLP Int. Limited v. WGCZ, S.R.O. et al, LawSuitData

Marjorie Grocq, Expanzo

WGCZ Holding, a.s., Expanzo

“The Czech Republic, Land of Pleasure,” Prague Morning, 10 August 2019

PORNORAMA - European Union Trademark Information, TradeMakers

Zo, what do we make of this? WGCZ, or WebGroup Czech Republic, a.s., to give its full name, tries to stay out of the public eye. It is run by French twin brother and sister Stéphane Michaël Pacaud and Malorie Deborah Pacaud, born 17 September 1978, together with their Czech partner, Robert William Seifert, born 22 November 1972, as well as supervisory board member Marjorie Grocq, born 2 August 1980. The independent joint-stock company lists its corporate address as WGCZ, a.s., Krakovská 1366/25, CZ-110 00 Prague 1, Czech Republic. A rival source adds that the office falls within “New Town,” or Nové Město. This latter source offers a description: “part of the Information Technology Services Industry. WebGroup Czech Republic, a.s. has 10 employees at this location and generates $64.13 million in sales (USD),” and further states that it started operations in 2012 and was incorporated in 2017. Elsewhere we learn that it registered as a business in Prague on 18 August 2014. WGCZ lists its industry as “Information Technology Services; Professional Services Sector; Computer related services, nec; Real property lessors, nec; Commercial photography; Theatrical producers and services, nec; Prerecorded records and tapes.” Expanzo lists its other activities as:

   46100 Wholesale on a fee or contract basis
   46900 Non-specialised wholesale trade
   47100 Retail sale in non-specialised stores
   62000 Computer programming, consultancy and related activities
   68200 Renting and operating of own or leased real estate
   68310 Real estate agencies
   73100 Advertising
   82100 Office administrative and support activities
As for “Fields of Activity,” I ran the list through Google Translator:
• Production, reproduction, distribution, sale,
   rental of audio and audio-visual recordings
   and production of unrecorded data carriers and recordings
• Mediation of trade and services
• Wholesale and retail
• Providing software, information technology consulting,
   data processing, hosting and related activities and web portals
• Advertising, marketing, media representation
• Services in the field of administrative administration
   and services of organizational and economic nature
• Production, trade and services nec
• Purchase, sale, management and maintenance of real estate

The Pacaud companies that share the Krakovská 1366/25 address are:
   Streamfury s.r.o.
   GTFLIX TV, s.r.o.
   NKL Associates s.r.o.
   SP Box, s.r.o.
   WGCZ Holding, a.s.
   Traffic F, s.r.o.
   DDF Communication, s.r.o.
   MME Traffic, s.r.o.
   WGCZ Limited, s.r.o.
   DONAMIS, s.r.o.
   SKY NETWORK, s.r.o.
   WebGroup Czech Republic, a.s.
   United Communication Hldg a.s.
   United Communication Hldg II a.s.
   United Communication Hldg III a.s.
   DONAMIS MEDIA s.r.o.
   GGW PARTNERS s.r.o.
   GGW MEDIA s.r.o.
   GGW GROUP s.r.o.
   DONAMIS GROUP s.r.o.
   DONAMIS II s.r.o.
   SONESTA TECHNOLOGIES s.r.o.
   SONESTA MEDIA s.r.o.
   SONESTA LIMITED s.r.o.
   MHUB1 s.r.o.
   Content SPV, s.r.o.

Google Maps reveals that WGCZ occupies an office space in an unassuming commercial building, with an almost-unnoticeable sign by the door, one of six. WGCZ’s four main assets are the XNXX, XVideos, DDF, and Bang Bros. websites. Hydrenta HLP Int. Limited filed a property-rights suit against WGCZ in 2015, and if you want to spend money (I don’t), you can find the legal papers here. A rival porno conglomerate, MindGeek S.a.r.l. et alia, also filed a suite against WGCZ at about the same time, and if you wish to purchase a subscription to PACERS (my subscription lapsed), you can read the court papers here. According to Ben Woods, the connections among the various WGCZ holdings are like spaghetti. XNXX is registered by VLab of Hong Kong, which also registered some of the other Pacaud companies, and XNXX is owned by NKL Associates, another of the Pacaud concerns. I do not understand WGCZ’s business model, because the WGCZ web content is free, borrowed (or “borrowed”?) from other sites. Are revenues generated from ad clicks? Is there something else going on? The four principals and the five or six other staffers have passive incomes. Surely, the office is automated. The computers do all the work. The people have it easy. So, again, to restate my vexing question: If it was making so much money, so easily, so automatically, what was the attraction in spending $11,200,000 in cash for a failed magazine? Why didn’t the ultrarich just let it fail? What concern was it of theirs? What did a failed magazine have that the ultrarich wanted or needed? Something else is going on. A couple of terms come to mind, but maybe I’m just being overly paranoid: “data harvesting,” “data mining,” and “useful idiot.” Also, think about this.

WGCZ did not begin its reign at Penthouse with a purge. It retained Kelly and her executive team and guaranteed them autonomy. Have you ever worked in showbiz or publishing? If so, you know what a guarantee of autonomy means. In case you haven’t worked in showbiz or publishing, count your blessings, sit yourselves down, and pay attention. The best thing to do when your new owner promises you autonomy: Run away. Cut all ties. Find new interests. Get a new career entirely unrelated to showbiz or publishing. A guarantee of autonomy is a guarantee that your work will be thoroughly sabotaged and that you will be set up to take all the blame. Having worked in showbiz and publishing myself, not just once, but many times, I speak from experience. A job driving a trash truck for City Hall is far more fulfilling, and far more respectable, and far more constructive — and far more remunerative, too.

On the off-chance that any of the film materials are still usable, would WGCZ wish to proceed with a restoration? A restoration would cost a fortune. There is no way a restoration would cost less than $3,000,000, and the price would in all likelihood be considerably higher than that. To put this into context, the restoration of The Other Side of the Wind cost about $6,000,000, and it was somewhat less complicated than a restoration of Caligula would need to be. There’s a heck of a lot of film in that collection, much of it in tiny little rolls of a few seconds each, or fractions of a second, much of it unlabeled or mislabeled. In a typical film restoration, only the approved takes need to be rescued and scanned. This is not a typical film restoration, since nobody knows which takes are approved. Everything needs to be scanned. Tinto shot about 96 hours of neg, and he recorded about another 30 hours of mag-stripe production audio. All of it needs to be digitized. Many of the materials in the collection are duplicates, but those would need to be scanned as well, since the originals may no longer exist. All the post-sync needs to be digitized too, in discrete channels, and there’s probably 50 hours of post-sync alone. Also, is the postsync recoverable? Fullcoat is not designed to last 40 years! If anyone other than a qualified professional with the proper equipment so much as breathed on it, well then, it’s gone forever. This would be a massive project. Where would the money come from? Where?

Postscript. Circa 17 August 2018: Kelly was fired, together with her whole top-echelon management team. The reasons: Heaven only knows. There are rumors, but as I have learned, when dealing with the porn biz — or not just the porn biz, really, but showbiz in general — or not just showbiz, really, but any biz at all — the true story is always buried, even by those who could save face and earn a guaranteed “Get out of Jail Free” card by revealing the truth. As for the bankruptcy and the ouster, it was inevitable, I guess. The terms of the mortgage were usurious; the mortgage payments drained all the profits and then some. It was only a matter of time, and I’m actually surprised that Kelly managed to hold on for a little over two years. Amazing. We have to wonder about the new owner’s interest in Penthouse? What’s in it for WGCZ?

I’m trying to think this through, and with such insufficient data, I’m bound to be more wrong than right. According to Keith J. Kelly, “Penthouse May Be Bought by High Times Suitor,” New York Post, 23 May 2018, Kelly Holland’s loan from ExWorks Capital was $9,000,000 at a 23% interest. As far as I can tell, Kelly got that loan in January 2016, and the first instalment was due probably in February. I do not know the term of the loan, though it was probably the usual 30 years. When we click those numbers into the Amortization Schedule Calculator, we see a monthly payment of $172,686, a total interest of $53,166,878, and a total payment of $62,166,878. Do you begin to see why I detest paying interest and refuse to do so ever again? I am convinced that ExWorks, from the outset, knew full well that the PH loan would quickly go into default. This is not the sort of loan that a bank would dare to make, since it was not just risky, but a guaranteed fail.

According to the New York Post, by May 2018 Kelly had managed to fork over a total of $5,300,000. When we check this number against the results in the Amortization Schedule Calculator, this is about what she should have paid by August 2018, $5,345,491, of which a piddling $328 would have gone towards principal. So the reported number and the guess number are only about three months apart, which means we’re pretty much on the right track in deciphering this mystery. If her interest were not the reported 23%, but, instead, 25%, we would be even closer still. My best guess is that she had made a couple of partial payments, and lending firms, in common with their progenitors, the Black Mambas of Sub-Saharan Africa, snap their venomous fangs at anybody who makes a partial payment. When ExWorks sold its debt to Dream Media, it did not sell that debt for $9,000,000 minus $328; it sold that debt for $9,000,000 minus $6,000,000. For those of you who did not know how lending firms operate, well, now you know. Though ExWorks collected less than a tenth of its projected revenue, it still made its money back, and was happy to sell the remaining debt at a discounted rate. Dream Media made a heck of a profit on that $3,000,000 investment when WGCZ Limited of Prague put in the winning bid of $11,200,000.

The preceding two paragraphs are probably on pretty wobbly grounds, but all I can do is go by the published data. Anyone who has ever done serious research on any topic knows how much to trust published data. If you have never done serious research on any topic, I can let you in on the secret about how much to trust the published data. Answer: Not at all. Yet the published data are the only available data; so let us continue to plough through. My assumption is that, since WGCZ is one of the top porn conglomerates in our solar system, and considering that it has been gobbling up rivals left and right, it has probably nearly as much money as the Scaife family, it has probably nearly as much money as the Koch family, it has probably much less money than Paul Singer or Vladimir Vladimirovich Putin or Semion Mogilevich, but it has probably much more than Mark Zuckerberg. If my guess about its wealth is correct, then it probably paid its $11,200,000 up front, in full, and did not bother about business loans. Actually, that’s not a guess. There’s no other possibility.

Remember, in 28 months Kelly was able to put $5,300,000 towards the mortgage interest ($189,286/month). Let us assume that WGCZ has no need to worry about any mortgages. Let us assume that WGCZ can continue running PH at the current level. If these two assumptions are correct, then it can earn its investment back in five years ($11,200,000÷$189,286=59.17 months). After that, it’s all gravy. My question, which I hazard to guess is also your question, is how much gravy will be left? How much longer can PH continue? PH had hopped onto the Playboy/King bandwagon in 1965, when pictures of naked people caused outrage and hearings in Parliament and criminal proceedings and ubiquitous headlines and widespread scandal, and, hence, were immensely profitable; but this is 2019, and nobody cares about such things anymore; it’s all so passé; there’s no novelty anymore, there’s no outrage, no scandal, no Parliamentary hearings, no criminal proceedings, no headlines, no curiosity. As for web porn, which generates probably more web traffic than all other sites combined, it’s a dying game. It’s not sustainable. It made a handful of bosses extremely rich these past two and a half decades, but the business model will change, and very soon. WGCZ will likely choose not to keep up.

Kelly tried her darnedest to run an honest business, and that, perhaps, was her singular mistake.

Irony. Do you like irony? Most people outside the US seem to thrive on irony. Most people inside the US seem to have no concept of irony. So here’s some irony. The first time I saw Penthouse magazine was in 1980, when I got second-hand copies of the April/May/June issues that had items related to Caligula. My opinion? I thought it was the very worst magazine I had ever seen. Then, when I decided to write this bloody 200 Degrees of Failure book, I needed to do research, which set me back countless tens of thousands of dollars. Among the innumerable items I sought out were vintage copies of Penthouse, especially the ones published in the UK back in the 1960’s. My opinion: I think it’s the very worst magazine I have ever seen. So here I am, with an entire suitcase filled to the brim with PH mags, even though I detest the stuff. When I worked briefly at PH, I did not even open the mag. Sarah, the very sweet receptionist, handed me the latest issue, inviting me to take a look. No, I said. No. Please, no. Enough was enough. No interest at all. Now you know my opinion. So, do you know what would convince me to subscribe to PH? If PH does the intelligent thing and fills its pages, each month, with more and more items from its Caligula business archive, I would subscribe. Why? Read on.

Fear. My fear now, as you can guess, is for the fate of the archives. There are vast business archives at the office; indeed, it would take many years to pour through them all. Every last scrap of paper I saw there was inherently riveting — the contracts; the arguments about the contracts; the business deals; the profit-and-loss statements, frequently falsified by various parties; the vicious, horrifying, terrifying inter-office memos; the stolen materials; the letters to and from business associates; the letters from students and audience members, some of whom adored the movie, but most of whom were furious at having been conned into the most stupid waste of time they had ever experienced. Above all, what these office materials demonstrate is the humorlessness of the PH execs and staff, who were all so dour, morose, sullen, grouchy, and deeply suspicious. They were miserable people who were convinced — convinced! — that everyone else was a con artist, and they went to extreme lengths to protect themselves and to smash all their perceived adversaries. To do so, they played dirty — really dirty. Reading thousands upon thousands of pages of those office documents was demoralizing. Those papers wore me down, and the attitude rubbed off on me. After every session in the archive room I would need to take a bit of an emotional cleanse to recover my senses. The world should have all these materials available, and the stolen items should finally be returned to G. Schirmer, Inc., and any other proper owners. Equally fascinating were the trinkets (such as a small Caligula coin designed to be sold at screenings, but which was never manufactured beyond a single prototype), collectibles (such as T-shirts), audiotapes (such as a press conference, Guccione’s remarks to university students, radio interviews with Guccione and de Lorenzo, unused music, and so forth), videotapes (all the masters of the Imperial Edition and more), photographs (many thousands of unpublished unit shots, shots of cinema displays, and so forth), cans of 16mm film (presumably unused footage from Giancarlo Lui’s promo), January/February 1980 posters (which were displayed at bus kiosks and train stations and at the première screening, but which I guarantee you have never seen in your lives, unless you happened to be in Manhattan at the time). There is also that monumental film archive which is housed somewhere or other. The sanest course of action would be to deposit all these materials at a university archive. The craziest course of action would be to toss all these materials into the city dump. What will happen? What will become of the collections?

INTERVIEWER: And here we are folks, on Death Row, to interview Mr. Innocent Victim, who is scheduled for execution next Monday afternoon. Hello Mr. Innocent Victim, what an honor to meet you at long last! I have read a great deal about you. As you know, Mr. Serial Murderer is being awarded the Presidential Medal of Freedom a week after your execution. We understand that you and Mr. Serial Murderer knew each other when you were children growing up in neighboring houses. I am doing a puff piece on Mr. Serial Murderer for my radio show, and I wonder if you have any nice things to say about him.

MR. INNOCENT VICTIM: I’ll talk with you only on condition that you make it known to your listeners that it was Mr. Serial Murderer who killed those twelve kids and framed me with planted evidence. After the trial, we even discovered a surveillance video that happened to capture the killings, but the Supreme Court refused to hear our case, saying that new evidence is not admissible on appeal, and that evidence of innocence is irrelevant, so long as there were no technical irregularities in the lower court’s proceedings. Yet every juror was bribed, as we have documented and as most of them later confessed. I have never lifted a finger against anyone, and, in fact, I was seen, in close-up, on the bleachers on a live television broadcast, cheering at a football game at the very moment that those kids were being killed. The prosecuting attorney suppressed that evidence.

INTERVIEWER: Look, Mr. Innocent Victim, this is just a lot of he-said/she-said, and I don’t want to get involved in your personal frictions with Mr. Serial Murderer. I just want to record a nice show with some fun anecdotes about his work and his benevolent activities. So, what was it like growing up with him as a neighbor when you were little schoolkids?

MR. INNOCENT VICTIM: The only statement I authorize is the one I just gave to you, which needs to be used in its entirety.

INTERVIEWER: Look, Mr. Innocent Victim, I cannot accept such unwarranted terms. This is my radio show, not yours. I am here to give some publicity to Mr. Serial Murderer to celebrate his winning of the Presidential Medal of Freedom.

MR. INNOCENT VICTIM: I won’t give that monster any publicity. I have nothing more to say.

INTERVIEWER: I find your behavior very confusing. It’s too bad that you don’t want to get involved, because it seems you know more about Mr. Serial Murderer than anyone else in the world. You have so much to contribute, and so it is a terrible pity not to have you onboard. Won’t you reconsider?

MR. INNOCENT VICTIM: Get out of here.

INTERVIEWER: I think, as the years go by, that you’ll come to regret your decision. Well, too bad. Anyway, no hard feelings, I guess. Better luck next time!

Back at the Studio.

INTERVIEWER: Mr. Serial Murderer, I have collected scores of warm statements about you from various indicted police officers, on-the-take police captains, corrupt politicians, real-estate developers, disbarred lawyers, hitmen, and especially from career criminals. They had nothing but the nicest things to say about you, and it will be difficult to cull their effusive praises down to a mere two hours to fit in our network time slot. Unfortunately, Mr. Innocent Victim, the person I most wanted to interview, declined to participate.

MR. SERIAL MURDER: That’s because he’s a sucker. He’s a loser, a sore loser, a child, a jealous crybaby who just whines whenever someone else wins. He’s another one of those pathetic little people who harbor a resentment against achievement. We can move on without him. He’s nobody important anyway.

Interestingly, Wikipedia has an entry that describes numerous companies for which I have worked, and it is especially applicable to the various incarnations of Penthouse. Too bad the grammar and spelling are so awful. Take a look at a few brief excerpts of the awful grammar and spelling, for buried beneath them is insightful commentary:

...The organizational psychopath

The organizational psychopath craves a god-like feeling of power and control over other people. They prefer to work at the very highest levels of their organizations, allowing them to control the greatest number of people. Psychopaths who are political leaders, managers, and CEOs fall into this category.^[5]

Organizational psychopaths generally appear to be intelligent, sincere, powerful, charming, witty, and entertaining communicators. They quickly assess what people want to hear and then create stories that fit those expectations. They will con people into doing their work for them, take credit for other people’s work and even assign their work to junior staff members. They have low patience when dealing with others, display shallow emotions, are unpredictable, undependable and fail to take responsibility if something goes wrong that is their fault.^[5]

According to a study from the University of Notre Dame published in the Journal of Business Ethics, psychopaths have a natural advantage in workplaces overrun by abusive supervision, and are more likely to thrive under abusive bosses, being more resistant to stress, including interpersonal abuse, and having less of a need for positive relationships than others.^[13][14][15]...

...Why psychopaths are readily hired

Leading commentators on psychopathy have said that companies inadvertently attract employees who are psychopaths because of the wording of their job advertisements and their desire to engage people who are prepared to do whatever it takes to be successful in business.^[5][6] However, in one case at least, an advert explicitly asked for a sales executive with psychopathic tendencies.^[19] The advert title read “Psychopathic New Business Media Sales Executive Superstar! £50k – £110k”.^[20]

Corporate psychopaths are readily recruited into organizations because they make a distinctly positive impression at interviews.^[21] They appear to be alert, friendly and easy to get along with and talk to.^[22] They look like they are of good ability, emotionally well adjusted and reasonable, and these traits make them attractive to those in charge of hiring staff within organizations. Unlike narcissists, psychopaths are better able to create long-lasting favorable first impressions, though people may still eventually see through their facades.^[23] Psychopaths’ undesirable personality traits may be easily misperceived by even skilled interviewers. For instance, their irresponsibility may be misconstrued by employers as risk-taking or entrepreneurial spirit. Their thrill-seeking tendencies may be conveyed as high energy and enthusiasm for the job or work. Their superficial charm may be misinterpreted by interviewers as charisma.^[6][23] It is worth noting that psychopaths are not only accomplished liars, they are also more likely to lie in interviews.^[24] For instance, psychopaths may create fictitious work experiences or resumes.^[23] They may also fabricate credentials such as diplomas, certifications, or awards.^[23] Thus, in addition to seeming competent and likable in interviews, psychopaths are also more likely to outright make-up information during interviews than non-psychopaths.

Why psychopaths are readily promoted

Corporate psychopaths within organizations may be singled out for rapid promotion because of their polish, charm, and cool decisiveness.^[25] They are also helped by their manipulative and bullying skills.^[22] They create confusion around them (divide and rule etc.) using instrumental bullying to promote their own agenda.^[26]

Psychopaths are able to maintain calm when others are reacting to normal stress and dangerous situations which makes them good fits for jobs such as the military, politics, and finances. Psychopaths are well versed in impression management and ingratiation, both skills that can be used to impress people in positions of power.^[27]

A manager such as the one described in the above Wikipedia entry is the darling of the owners, who will not understand why there are suddenly so many problems, why the employees are suddenly so discontent, and why the company is tanking. Morons. I bolded the term “instrumental bullying” because I had never run across it before. I looked it up. Yup. That’s exactly what’s going on. That ties in with another term I just learned, “kiss-up/kick-down.” I had never heard it before, but I recognized exactly what it meant, for I have witnessed that phenomenon every single day of my life from before my first memories all the way through pretty darned recently. That is also definitely occurring right now at you-know-where. As far as the film project is concerned:

Mel gives the most perfect depiction of psychopathy I have ever seen on screen:
utter irresponsibility, together with an utter incomprehension of why anybody would care,
combined with an utter unconcern about it.
This is not the only type of psychopath there is. There are plenty of types.
Yes, I have met the raging maniacs, the charming criminals, the animal-torturers, and so forth,
but, in my personal experiences, it is this hopelessly irresponsible type I have most often run across.
This is the sort of person who is beyond repair, beyond reach.
This is the sort of person who just doesn’t get it, and who can’t get it.
Therapy would just make him worse.
I have worked with people like this, and I wanted to murder them.
Their lives are blessed and they never experience discomforts; instead, they get promotions,
they get profiled in newspapers and on television, they become pastors of their churches,
their businesses get major ongoing gifts from City Hall,
they get paid to give keynote addresses around the world
on morality and ethics and strength of character and empathy and kindness,
whereas I get fired, slandered, libeled, smeared, threatened, detained — BECAUSE OF THEM!!!!!

Moral: If you don’t understand the materials, keep the bloody heck away!
Moral: If you do understand the materials, keep everyone else the bloody heck away!

This is not a comedy sketch. This is not an exaggeration. At all!
This is happening, right now.

A parallel situation.
(You might love Rachel Maddow, or you might detest her.
I don’t care. That’s not the issue.
The issue is the story she tells, which is a true story.
Robert S. Stewart of Arlington never delivered the goods,
and so he never got that $34.5 mil or $38 mil or whatever it was supposed to be.
Instead, he managed to finagle about $400,000 out of the government.
Clever guy – almost.)

Then there was this inspirational story from a little more than a decade ago:

Κακοῦ γὰρ ἀνδρὸς δῶρον ὄνησιν οὐκ ἔχει.

#30#

THERE HAS BEEN MUCH HOPE. WELL, I’M SORRY TO BREAK IT TO YOU, BUT...

THERE HAS BEEN MUCH HOPE.
WELL, I’M SORRY TO BREAK IT TO YOU, BUT...