Winner Takes All Read online

  Kirk Kerkorian has owned his own movie studio and spends part of nearly every year on the French Riviera. Glenn Schaeffer, the former president of Mandalay Resort Group, snared a recurring role on the television show Las Vegas. He played a casino owner alongside actor James Caan, whom Schaeffer took to calling “Jimmy.”

  As investments go, casinos sure beat pork bellies.

  Las Vegas is headed toward being a “major city,” visited each year by more than four million international travelers, including business and political leaders who come to use Las Vegas for their own devices.

  Yet, for all its phenomenal growth, Las Vegas behaves like a small town. The Strip pulses with the testosterone of casino bosses who are locked in treacherous rivalries but attend one another’s birthdays and charity galas and send their kids to the same two private schools.

  Las Vegas may be plastic and modern, but it retains a libidinous frontier air—a pioneering, can-do zeal to improve. This is a city that will send in road-building crews on the graveyard shift in order to avoid disrupting the flow of traffic into a new casino. It’s a mindset that comes from the knowledge that Las Vegas initially had nothing, really nothing, going for it except its willingness to be bulldozed.

  And imploded. And bulldozed again into resurrection.

  Chapter Two

  “RIFLE RIGHT”

  There was a time I was aiming at $100,000. Then I thought I’d have it made if I got a million dollars. Now it isn’t the money.

  —KIRK KERKORIAN

  Kirk Kerkorian, clad in gray pants and a blue dinner jacket, strolled into the ballroom of the Mirage hotel in late November 2005. He was flanked by a couple of old friends. His little entourage made its way to a table front and center, where a line of white-coated waiters stood at attention—the only line of waiters in the ballroom.

  This year, the Nevada Cancer Institute’s Rock for the Cure gala had an angelic theme. Hors d’oeuvres were served by leggy “rock angels” wearing white hot pants, white platform go-go boots, and four-foot-long feathered wings. A topless angel with silver sparkles painted on her nipples swung lazily from a trapeze bar on the ceiling. She looked bored. The actor George Hamilton strolled by with his famous ochre complexion.

  Onstage, television personality Larry King chitchatted from a dais. King’s trademark suspenders were slung over his bony shoulders.

  “He’s gonna hate me for doing this,” King confided to the microphone, “but he’s one of the world’s great entrepreneurs and he’s here tonight! Kirk Kerkorian, folks! Give ’im a hand. Take a bow, Kirk.”

  The room rose en masse, people in gowns and tuxedos throwing their hands together in applause. Kerkorian nodded politely, a movie studio owner who waits in line to see films anonymously in theaters, a casino mogul who views boxing bouts in his own casinos from the nosebleed section.

  Rock for the Cure is one of the big charity balls in Las Vegas, where the town’s elite bid each year on such desirables as a golden retriever puppy, Muhammad Ali boxing mitts, and dinners cooked by Wolfgang Puck. The other elite charity events of the year in Las Vegas are an Alzheimer’s gala headed by Larry Ruvo, who runs the region’s dominant wine and liquor distributorship, Southern Wine and Spirits; and Andre Agassi’s annual Grand Slam for local children’s causes.

  “There’s no more Howard Hughes,” King continued, his gravelly basso rising like a carnival barker. “We have Kirk Kerkorian!”

  The Mirage’s ballroom was full of designer gowns glued to artificially augmented bodies—a blend of Hollywood va-va-voom and Kansas City spangles. At some point during the evening, a Bentley Continental Flying Spur was auctioned off for $220,000, and an outing with Tiger Woods went for $350,000.

  A date with flirtatious Fox Sports weathergirl Jillian Barberie was sold twice—each time for $100,000—with coaxing from Larry King. “Larry’s my pimp,” Barberie joked from the stage.

  Later, the comedienne Rita Rudner performed. Rudner lives in Las Vegas. She began her routine by voicing one of Las Vegans’ fondest hopes: that they might become a legitimate city. Not just white-glove, but world-class.

  The Nevada Cancer Institute, one month old, was promising Las Vegans the panache of real medical research. It was founded by one of the town’s new power couples, Heather and Jim Murren. Jim Murren was president and chief financial officer of Kerkorian’s casino company, MGM Mirage. Heather Murren had abandoned a seven-figure income as a Wall Street analyst to found the institute.

  In her speech that evening, Heather Murren noted that patients had already flown in for treatment from as far as Arkansas. A murmur of awe rippled through the ballroom. “We’re getting so sophisticated,” Rudner said dryly. “I tell people in New York not to get too uppity.”

  Then she gazed across a glittering sea of rock angels and trophy wives. “Here, breasts—they’re more than a body part,” Rudner deadpanned, “they’re entertainment.”

  The singer Stevie Nicks was preparing to take the stage as Kerkorian was leaving, still flanked by his pals, a few minutes before ten p.m. Larry King was back at the microphone.

  “On Saturday, I am seventy-goddamned-two years old and Kirk Kerkorian is my hero,” King told the crowd. “He’ll live forever. And if he doesn’t, he’ll buy heaven and sell shares.”

  Kerkorian’s office is in the leafy commercial district of Beverly Hills, on Rodeo Drive, just around the corner and across the street from the Barneys New York store. It is separated from the paparazzi tourist movie-star hubbub part of Rodeo by the automotive whoosh of Wilshire Boulevard. Down one more block, the neighborhood turns to homes with small, neatly kept backyards.

  The office building, a modern low-rise with a dozen or so tenants, is unmarked by Kerkorian’s name or the names of any of the companies that he controls. One must simply know.

  Kerkorian stands 5′11″ or thereabouts and has an etched face, a pugilist’s nose, and stubborn, wavy white hair. Even in his ninth decade, he is tennis svelte. He goes just about everywhere with a posse of loyal cronies who are willing and able to jet off with him at a moment’s notice. Yet aside from being a billionaire, a sometime Hollywood studio mogul, and a casino tycoon, Kerkorian is quirky and old-fashioned—a relic. Most of his contemporaries are six feet underground. At midlife, he was Howard Hughes’s nemesis and Cary Grant’s buddy. In his youth, he boxed and flew airplanes.

  He keeps life as simple as any mogul can. He doesn’t use credit cards or wear a watch most days, according to friends. Embarrassed about his lack of formal education, he doesn’t make speeches or accept awards. He has donated millions of dollars to charitable causes—many of them in Armenia, and even including the Armenian government—but he won’t allow any of the roads, buildings, or other projects to be named for him and he has not so much as visited any of them, according to a longtime friend. Kerkorian is as likely to lunch with his bookkeeper as with another business titan—perhaps more likely. He drives himself around in regular-guy vehicles. Recently it was a pair of white Jeep Cherokees—one in L.A., another in Las Vegas.

  To meet Kerkorian is to receive a polite handshake, a nod, a restrained smile. He is unreadable. People say it’s an adrenaline rush to do business with Kerkorian, but this comes as much from people’s imaginations—“He is a legend!”—than from anything in his unextraordinary behavior.

  Kerkorian runs two primary companies. One is called the Tracinda Corporation. The other is the Lincy Foundation. Both are an amalgam of the names of Tracy and Linda—his two grown daughters from his second marriage to a former Las Vegas showgirl named Jean Maree Hardy. Linda is adopted, according to several accounts. Kerkorian is legally the father of a third daughter, Kira Rose Kerkorian, though the girl turned out to be another rich man’s progeny.

  Tracinda owns his holdings in the other companies that Kerkorian controls. Its offices on Rodeo are quiet and genteel, according to several people who have worked there. The receptionists, accountants, and lawyers begin to arrive around nine a.m. to begin a day th
at is steeped in tradition, as some have worked there for three decades. They leave at the stroke of noon to lunch together, typically at one of three restaurants. The choices include a Mexican eatery, a French bistro, or a soup-and-sandwich shop. Kerkorian often eats a sandwich at his desk or lunches at a restaurant around the corner at the Beverly Wilshire Hotel, his colleagues say.

  No one seems to be particularly clear on how Kerkorian spends his hours in his office, other than to say that he isn’t pushing papers or sweating details. He speaks on the telephone. He thinks.

  Everyone heads home around five p.m.

  Widespread beliefs that Kerkorian leads a frugal life are just false.

  Kerkorian maintains large homes in Los Angeles and Las Vegas. He travels in his own Boeing 737, which according to legal records is furnished with a living room, kitchen, two bedrooms, and seats for twenty-one passengers. In addition to walking around with a wad of thousands of dollars in his pocket, he has also had a long and fickle relationship with a yacht—a 192-foot, German steel-hulled boat with two 1,750-horsepower Caterpillar engines, a teak sun deck, a gymnasium—plenty of comfort but no “frou-frou” details—with room for ten guests and a dozen crew members.

  It’s the twenty-second largest yacht in the world, according to Power & Motoryacht magazine’s 2005 rankings. The yacht is one of those assets, like the MGM movie studio and his early airline, that Kerkorian keeps buying and selling.

  Kerkorian chartered the yacht in her earlier life, liked her, bought her, named her the October Rose (his sister’s name is Rose), sold her, and after she underwent a series of new owners (including Larry Ellison) and new names (Libertad, Sakura), bought her back again. And named her October Rose again. Then sold her again.

  “It’s a guy’s boat,” says Douglas Sharp, of Sharp Design in San Diego. Kerkorian hired Sharp to refurbish the yacht, but didn’t seem much interested in the details. “We just met him once,” says Sharp, who had traveled to Las Vegas with a set of plans for the yacht’s refurbishment.

  “One of the meetings was really bizarre. We sat in the outer office and sent the designs into an inner office,” Sharp says. Kerkorian sent an emissary with his comments, but didn’t bother to step outside his office or invite Sharp in. “We never saw him.”

  When Kerkorian kept the yacht in San Diego, Sharp says, “She was always on the move. His crew would get a call and have to take her out. It was for his friends to use—and for him to use. It was never chartered.”

  Later, Kerkorian kept her on the French Riviera. By April 2006, yachting circles were chattering that Kerkorian had moved on again. The yacht was spotted in France and Italy with yet another name, Magna Grecia, signifying another new owner.

  Kerkorian belongs to the Beverly Hills Tennis Club, which is located on Maple Drive in the shady, flat part of Beverly Hills. The club roster is posted on a wall near the pool. There is Neil Simon, the playwright, and the actor Kirk Douglas. There is Henry Gluck, the former chairman of Caesars World. And there are several of Kerkorian’s close crowd: Terry Christensen, his longtime lawyer, and Alex Yemenidjian, his onetime protégé.

  The Beverly Hills Tennis Club is venerable now, but it was founded by rejects. Groucho Marx and several other Jewish tennis lovers founded it after they weren’t welcomed into the restricted Los Angeles Tennis Club in blue-blooded Hancock Park. That was back when Beverly Hills was nouveau riche. Cheery pictures of Charlie Chaplin, Carole Lombard, and Errol Flynn in tennis togs still adorn the walls.

  On any given afternoon, the average age of the players at the club is in the neighborhood of seventy years and at the casual restaurant overlooking the pool it is possible to lunch with former Secretary of State Warren Christopher on one side and a movie studio chief on the other.

  In a room to one side known as the “card room,” there is what amounts to the club’s wall of honor, hung with youthful photographs of members who served in the armed forces. There is a baby-faced Joseph Wapner, who would later become television’s “Judge Wapner.”

  Kerkorian was a civilian flight instructor and “too smart” to serve in the armed forces, says one member whose photo is also on the wall. But there he is anyway, standing against a small plane and wearing a leather jacket, palming a cigarette. His eyes look smoky with shyness—or impatience.

  During heavyweight bouts at his casinos, Kerkorian can be found plunging into the crowd far from the VIP seats where Steve Wynn and Donald Trump vie for spots in the limelight. He likes action, not pampering. When gunfire broke out in the MGM Grand Casino after the Mike Tyson–Evander Holyfield match, Kerkorian was in the crowd, elbow-to-elbow with Dan Wade, the MGM Grand’s president.

  He can be curiously helpless, in the manner of one who has other people handle details. One day not long after 9/11, when Hollywood feared its movie studios were terrorist targets, Kirk Kerkorian drove himself onto the lot of the Metro-Goldwyn-Mayer studio, which he controlled. The guard at the gate had no idea who this gentleman in the Jeep was, recalls Alex Yemenidjian, who was then the studio’s chairman.

  The guard asked Kerkorian to pop open his trunk for a security check. Kerkorian said courteously that he didn’t know how, but the guard was welcome to open it if he could find the button.

  Kerkorian’s control of casinos, movie studios, and other businesses is de facto but not de jure. MGM Mirage, for instance, is run by an executive committee and the board of directors. Kerkorian attends the meetings, and the company’s executives are careful to brief him beforehand. “No surprises,” says Yemenidjian. Technically, Kerkorian is just another board member and big shareholder. J. Terrence “Terry” Lanni is the company’s meticulous chairman and chief executive.

  The way Lanni got his job says a lot about the way Kerkorian leads his life and his businesses.

  Terry Lanni spent nearly two decades at Caesars before Kirk Kerkorian and Steve Wynn came calling at about the same time. Kerkorian needed help fixing the MGM Grand, which was being picketed by the powerful local Culinary Union and was suffering the ills of poor design and management. He asked Lanni to meet him at a hotel near his office in Beverly Hills.

  “He asked me about what I thought of the MGM Grand,” Lanni recalls of his interview. “I said it wasn’t very well run, it was too big, and there must not have been an architect. He asked me about the union. I said it would be very hard for me to work at a place in Las Vegas without the union.”

  “I don’t get involved in any of those things,” Kerkorian replied. “I leave it all up to the management.”

  Often a phone will ring in Las Vegas in an office of the casinos that Kerkorian controls. It might be the chief financial officer’s office or the general counsel’s or the chief executive’s. More often than not, the caller won’t be “Mr. K,” but another of his trusted executives who is seeking a piece of information: Why is the stock price down 1.5 percent? Who is exercising their stock options and why?

  Kerkorian moves people back and forth between Tracinda and his other enterprises, even sometimes convincing his attorneys and accountants to come work for him. Alex Yemenidjian rose from tax accountant to movie studio head this way. When MGM Mirage needed a general counsel, Kerkorian plucked Gary Jacobs out of private legal practice and put him in the job.

  Many of these people at Tracinda don’t have traditional job titles that would clarify what they do for a living. There are cloudy, generic titles, such as “executive.”

  For many years, Kerkorian has played aggressive games of tennis with a group of close friends at his home each weekend that he is in Los Angeles. Being included in these sessions is a coveted privilege. When Yemenidjian stopped working for Kerkorian, he made a point of saying he was still invited to play tennis.

  “Kirk is a god,” Yemenidjian says.

  One of the rare photos of Kirk Kerkorian in public circulation shows him in the Las Vegas sun with the steel girders of the rising structure of the International Casino and Hotel behind him. It is 1969. He looks lean and masculine. He’
s holding a small sheaf of papers in one hand and he is smiling broadly.

  He looked younger, but Kerkorian was already fifty-two years old, with two young daughters and a company named after the first—the Tracy Investment Company. He was in the midst of taking over the Metro-Goldwyn-Mayer movie studios in Los Angeles, for the first time. Much like the October Rose yacht, he would later sell, buy, and sell it again.

  Caesars Palace had opened three years earlier. Its playful, full-body Grecian theme began at the streaming fountains in front and continued through to the “goddess” cocktail waitresses with their fake blond tresses. Caesars was built with Teamsters money, but it was the brainchild of an imaginative fellow named Jay Sarno whose bacchanalian life mirrored that of his resort.

  Sarno in 1968 opened another groundbreaker—Circus Circus—where a baby elephant wandered around for entertainment. Sarno was a creator, not a mogul, and he was forced to sell off both his ill-managed casinos. After a sixty-three-year lifetime of fun and debauchery, he would die of a heart attack in 1984, a virtual pauper. His lifeless body was found in a luxury suite at Caesars Palace, where, according to an executive there, he had been enjoying the female fruits of a night’s gambling.

  But Sarno lives on. His cherubic visage is the model for the cartoonish “Caesar” seen around Caesars Palace and on some of the hotel’s stationery—being fed grapes, appropriately enough, by a female serf. Years later, Steve Wynn would become a great admirer of Sarno and closely study his ideas.

  Caesars Palace generated so much excitement that it wasn’t long before Ol’ Blue Eyes moved over from the Sands, heralding the end of the Rat Pack and Las Vegas’s fondest era.