The Outfit (19 page)

“So the guys in New York are already softened up for us,” Nitti said. “They are just waiting for us to walk in the door and ask for money.” He recalled how Al Capone had often expressed his desire to move in on Hollywood. It was well-known that many stars and producers were either juiced up or had other skeletons in their closets. If nothing else, they were vulnerable to blackmail. Nitti then concluded colorfully, “The goose is in the oven waiting to be cooked.”

Nick Circella was designated Browne’s nonstop watchdog, while Johnny Rosselli was directed to look over the shoulder of Bioff, who would soon be dispatched to Los Angeles. Before the meeting adjourned, the Outfit had voted to institute a methodical plan to infiltrate the business of movies, with Nitti closing the meeting by saying, “I think we can expect a permanent yield of a million dollars a year.”

1
. McGurn was certainly versed in the ways of muscling entertainers. In 1927, he was given a 25 per cent interest in the North Side Club the Green Mile for settling the club’s dispute with comedian Joe E. Lewis. After the popular Lewis, who had been the club’s star attraction for a year, jumped ship for a better offer at a rival club, McGurn was brought in to talk some sense into Lewis. Before opening at his new venue, the Rendezvous, Lewis was informed by McGurn, “You’ll never live to open.” Lewis did in fact open, but one week later he was met by three thugs, two of whom crushed his skull with pistol butts, while the third hacked away mercilessly at Lewis’ face with a large knife. Incredibly, he recovered, but the resultant brain damage left him unable to talk for months, and the knife wounds left him disfigured. During his convalescence, Lewis received a $10,000 gift from Al Capone. The story was dramatized in the 1957 Frank Sinatra film
The Joker Is Wild.

2
. Carl Laemmle, founder of Universal, started in Chicago, likewise Adolph Zukor;Barney Balaban, president of Paramount; Sam Katz, VP of MGM; and Leo Spitz, president of RKO. Actors from Chicago included Wallace Beery, Tom Mix, and Gloria Swanson.

6.

“Hollywood, Here We Come”
(The New Booze II)

I
n August 1933, the entertainment industry’s biweekly newsletter
Variety
reported on the widely circulating rumor that “the Chicago crowd,” was fixed to launch an assault on the 1934 IATSE convention. Although the trade paper was making reference to George Browne’s predicted second try at the union presidency, the prognostication was more accurate than could be known at the time. In fact, the most significant “Chicago crowd,” the Outfit, was about to hijack the convention, with George Browne as its front man.

On June 34, 1934, the IATSE delegates convened their biennial assemblage in Louisville, Kentucky, at the ominously named Brown Hotel on Broadway. In an unusual move, IATSE barred the local press from the closed-door proceedings. John Herchenroeder, editor of Louisville’s
Courier-Journal,
recalled for crime reporter Hank Messick years later, “We sent a reporter over to the hotel, but he couldn’t get in, so we ignored the convention.” It soon became clear why prying eyes were not allowed to witness the furtive gathering. In attendance alongside union delegates were mobsters from all the major crime families: Meyer Lansky, Ben Siegel, Lucky Luciano, and Lepke Buchalter from Newr York; Longy Zwillman from New Jersey; Big Al Polizzi from Cleveland; Johnny Dougherty from St. Louis; and of course the hosts, Chicago’s Outfit. With Buchalter as the gangsters’ “floor manager,” gunmen patrolled the aisles, sat on the dais, and lined the room’s perimeter. Many observers had the impression that there were more gunmen than delegates in the hotel’s auditorium. Not surprisingly, IATSE delegates were quickly persuaded to anoint Browne as their new president. So frightened was the membership that no one else dared ask to be nominated. George Browne ran unopposed. (After the convention, the Outfit billed IATSE for the gangsters’ hotel rooms and traveling expenses.)

The new IATSE president took the stage, feigning astonishment at his fortune. His performance set a new standard for maudlin behavior as he cried profusely, seemingly unable to muster the strength to give a speech. All he could do was repeat over and over, “Thank you, boys. Thank you.” He was likely addressing his gangster benefactors.

After the convention, Browne, Bioff, and Circella were sent to New York, where they informed the Producers’ Association of their intent to revitalize IATSE. After the meeting, Bioff was taken by Circella to the Medical Arts Sanitarium, where Johnny Rosselli was undergoing treatment for his chronic tuberculosis. It was time for Bioff to meet his Los Angeles overseer. “Johnny Rosselli here is our man,” Circella intoned. “He handles the West Coast for us. If there is anything that goes on on the West Coast with any producing company, we will know. There is nothing you or George can do that we won’t know.”

Browne and Bioff spent the remainder of 1934 in Chicago bringing holdout unions into line with their power play. In later testimony, Bioff explicitly detailed his modus operandi (expropriated from Tommy Maloy) when he recalled his approach to theater owner Jack Miller: T told Miller the exhibitors would have to pay two operators in each booth. Miller said: “My God! That will close up all my shows.” I said: “If that will kill grandma, then grandma must die.” Miller said that two men in each booth would cost about $500,000 a year. So I said, well, why don’t you make a deal? And we finally agreed on $60,000 . . . You see, if they wouldn’t pay, we’d give them lots of trouble. We’d put them out of business - and I mean out.’

Another movie house owner, Nathaniel Barger, recalled to an IRS investigator how he was coerced into paying Bioff approximately $50,000 over three years: ’After my theater had been opened for approximately two months, Bioff walked into the office and said, “Well, partner, how is business and how do we stand?” There seemed nothing I could do - either close up the theater and go out of the business I had been in all my life or bow to Mr. Bioff. So, later, I started paying Mr. Bioff half my profits. When there were losses in the theater, he did not share any loss, nor did he put in any money at any time.’

Bioff later recalled, “Barger raved and said it wasn’t fair, but I told him that was the way it had to be if he wanted to stay in business. He went along.” When Barger was forced to divest himself of a burlesque house to offset his loss in profit, Bioff helped himself to half of the sales price. One harassed theater owner lamented, “We are being unmercifully persecuted by a notorious method of racketeering by a gang of inhuman scoundrels. Our theaters are being stench-bombed, tear-gas-bombed. Three have been burned. They are broken into at night and motion picture machines, seats, carpets, draperies, are destroyed.” The Outfit made it clear that their newest business plan was not to be denied. One by one, theater owners in Illinois and surrounding states caved in to the gangs’ will.

In the near term, the Outfit was forced to proceed without the daily counsel of its Einstein: In October, Curly Humphreys surrendered himself to the authorities and began serving a prison term in Leavenworth. He had been indicted for tax evasion on a kidnapping ransom payoff he’d received, but had never been indicted on the kidnapping itself. According to Curly’s daughter, her father uttered an upbeat farewell as he packed for the big house: “While I’m down there, I intend to study English and maybe a little geometry.” However, many believe that he actually focused on business math, for when he was released fifteen months later, he helped design the Outfit’s strategy for ambitious business takeovers on a national level. Many government officials, as well as Humphreys experts in the fourth estate, are certain that the Brainy Hood was in constant contact with his crew during his stay in “college.” Royston Webb, a Welsh scholar who conducted a five-year doctoral study of Humphreys, noted recently, “There is no doubt that Humphreys, much as Capone had done years before, orchestrated the key decisions of the Hollywood takeover from behind bars. It was also to his great fortune that he was unavailable for the initial face-to-face meetings with Bioff and Browne. It gave him deniability in the future.” It also rendered Paul Ricca, Johnny Rosselli, and the others vulnerable, should the caper be unraveled by authorities.

After giving Curly a rousing send-off, the Outfit mulled over where to install Nick Circella in the union hierarchy. At the time, Nitti was worried that Maloy would succumb to IRS pressure, and the Outfit’s titular head was not anxious to go back to the slammer. In a convenient turn of events, the solution to the Maloy problem simultaneously answered the question of Circella’s future. On Christmas Eve, 1934, the Outfit met and pronounced a death sentence on Maloy. At noon on February 4, 1935, as Maloy drove on Lake Shore Drive, along the now deserted “Century of Progress” grounds, the union boss received two fatal shotgun blasts from two gunmen in another vehicle. Chicago FBI agent Bill Roemer strongly asserted that the hit men were Joe Accardo and a young up-and-comer named Gus Alex.

One of Maloy’s pallbearers was none other than George Browne, who, after the service, headed straight to the offices of Maloy’s Local 110. Not long after his coup, Browne named Nick Circella to Maloy’s vacant post. As with so many other figures of Chicago infamy, Tommy Maloy was given one of the largest funerals in the city’s history, marked by a three-hundred- car procession. In July, another obstacle was unceremoniously removed from the Outfit’s road to the promised land. Three Gun Louis Alterie, the stubborn holdout president of the Theater Janitors’ Union, and the executioner of the horse that had thrown Dean O’Banion’s partner years earlier, was shot to death. Still another unsolved Chicago gangland rubout.

Another Battlefront

With the Browne and Bioff situation now operating under its own inertia, the emboldened Outfit decided to spread its wings. As noted, one of the gang’s initial goals was the infiltration of the bartenders’ unions. Even with his union mastermind Curly Humphreys in jail, Nitti felt sufficiently confident for the assault and decided the time was right to make the move. The hoods’ chosen point of attack, George B. McLane, was the business agent for Local 278, the Chicago Bartenders and Beverage Dispensers Union. Although the local comprised only fifty-three hundred members, it was affiliated with fifteen other similar guilds with a combined thirty thousand members. The Outfit planned to take them all.

McLane’s nightmare began, he later testified, in the spring of 1935, when an Outfit union slugger in Curly’s crew named Danny Stanton telephoned him at his union headquarters. McLane recalled, “I knew Stanton was a slugger for Red Barker and Murray Humphreys. He said he wanted five hundred dollars to go to the Kentucky Derby. He said he would send over two men for it. I told him I had no right to give out union funds.” Stanton ignored McLane’s rebuttal, saying, “I’ll have two men over in a half hour to to pick up the money.” When the thugs showed up, McLane turned them away, which prompted an angry Stanton to call again. “You son of a bitch,” Stanton yelled. “We will get the money and take the union over.” Within days, McLane was summoned to Nitti’s office at the LaSalle Hotel. Nitti demanded that McLane install an Outfit member in his union’s hierarchy. The courageous (or foolish) McLane refused Nitti’s demand. Nitti exploded. “We have taken over other unions,” he blustered. “You will put him in or get shot in the head.” Within days, McLane was brought to Nitti again, this time at the Outfit’s private third-floor dining room at the Capri Restaurant. Once inside, McLane was confronted by a star chamber that included Nitti, Ricca, Campagna, and partners of the imprisoned Curly, Fred Evans and Sam “Golf Bag” Hunt. Again Nitti threatened, “How would your old lady look in black?” This time McLane softened, saying he’d see what he could do.

When months went by with no action, McLane was back at the Capri before an Outfit that was losing its patience. McLane explained to Nitti that he had asked his board if they would accept an assistant named by Nitti, and they had turned down the suggestion. Nitti demanded to know the names of the opposing board members. This time he told McLane, “This is your last chance. Put our man in or wind up in an alley.”

“I went back to the union and told them about the threats to me and to them - what it meant,” McLane later testified. “They had no alternative. They agreed to putting a man on.” In short time they were introduced to one Louis Romano. “His salary will be seventy-five dollars a week out of the union treasury,” Nitti ordered McLane. “You’ll have to make provisions to raise it later. Romano will see that all the Outfit places join the union.” The Outfit clearly had its sights fixed on the thirty thousand members of the affiliated unions. For the next five years, the gang, via Romano, called the shots in the bartenders’ union, while collecting $20,000 per month in dues. According to McLane, Romano admitted that he was whisking the money off “to the boys in Cicero.” McLane said that over the years, Johnny Patton, “the boy mayor of Burnham” and Outfit racetrack maven, attended the Outfit’s board meetings. Patton gave reports about which brands of booze were being sold at the gang’s dog tracks. “Patton said the bartenders were not pushing the right stuff,” McLane said. The brands manufactured by the Outfit, especially Fort Dearborn whiskey, were “the right stuff.”
¹
“Tell those bartenders that if they don’t push our stuff, they will get their legs broken.” The Outfit and McLane maintained the status quo of the bartenders’ union until Curly was released from prison to oversee its expansion. Until then, the gang profited (approximately $3-5 million per year) from their liquor sales and the monthly dues extracted from the union’s five thousand members.

Meanwhile, the movie scam began to get serious. Browne and Bioff were soon ordered to New York, where they were brought further into the loop of the New York-Chicago national crime consortium. As it was learned in subsequent testimony, the duo, accompanied by Paul Ricca and Nick Circella, was directed to Tommy Lucchese’s Casino de Paree restaurant in Manhattan, where they were joined by gang leaders from other major cities. Among the attendees were Rosselli’s partner Jack Dragna from Los Angeles and New York associates Lucky Luciano and Frank Costello. After the meeting, Ricca instructed Bioff that he would soon be working both coasts, ferrying between Manhattan and Hollywood. “Feel free to call on Charlie Lucky or on Frank Costello if you find any difficulties here in our work,” instructed Ricca. “If you need anything, be free to call on them, because they are our people.” Torrio’s dream of a national crime consortium had come to fruition.

Soon Browne, accompanied by Bioff and Circella, flexed his muscles. On July 15, Browne called an IATSE strike in New York against the Loew’s and RKO theater chains. It was his way of introducing himself to the moguls of the movie business. By noon, General Leslie Thompson, chairman of RKO, became the first victim of the grand scheme. After a period of tense negotiating, Thompson handed over $50,000 for strike insurance, adding another $37,000 the next morning. “A good morning’s work,” Bioff said, laughing.

Next, the trio paid a visit to Nick Schenck, president of Loew’s. Willie Bioff and the Schenck brothers shared similar backgrounds, being Russian-born Jews who knew the value of mixing a criminal and honorable ethos simultaneously. Joe Schenck, Nick’s brother and L.A. based partner, was another known to walk through life with one foot in the upperworld and one in the underworld. On one hand, his generous donations to Roosevelt gave him carte blanche with the White House, especially with Jim Farley, FDR’s New Deal director. In addition, Schenck’s cozy relationship with the California state legislature, again thanks to donations, saw him well treated on the local level. “Whatever Joe Schenck wanted, I got for him,” said the de facto boss of the state legislature, Arthur Samish. On the other hand, Schenck was well known to be in bed with the famous gangsters of the era. As has already been noted, Schenck had been a close friend of Johnny Rosselli’s for years. But Johnny was just one of Schenck’s many hoodlum acquaintances. “He came to know every element of the gangster world, from the lowest ranks on up to the top echelons,” recalled Schenck’s screenwriter friend Anita Loos.