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We finished our field reporting for this story just days before the U.S. went on lockdown due to coronavirus literally slipped over the Canadian border just before it closed. As we all know, the pandemic has had a devastating effect on so many businesses. One of the industries most impacted has been live theater. A few of the folks who helped out with this episode are out of work right now and will continue to be for the foreseeable future, along with their actor, dancer, singer, musician, choreographer, costume designer, wigmaker and stagehand friends.

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This episode is for them.

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When the Pantages Theater in downtown Toronto opened in 1920, it was the largest cinema in all of Canada and the most grand with its gold leaf, decorative molding and imposing marble balustrade, the theater exuded a kind of opulence, except the fancy details were all an illusion.

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The Pantages was a vaudeville theater. And what is vaudeville selling, if not illusion?

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People lived in a lot more squalid conditions, but for 10 cents they can come into this opulent place and it's you go into fantasyland.

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That's John Kerry's Stamatis.

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He works for Mirvish Productions, which owns the theater, and he is giving me a tour, a mural of a mural, a mural effects and half naked dancing, you know, and it almost looks like naïf painting.

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Over the years, the theater has had many lives. It was a burlesque house, a 3000 seat cinema and a venue for live shows. It's also had many names the Pantages, the Imperial and its current appellation, the Ed Mirvish Theater.

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And in 1986, it was at the center of one hell of a few.

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At the time, a company called Famous Players ran the theater as a cinema. Across the street was the Cineplex Odeon Movie Theater, run by a guy named Garth Drabinsky.

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He is of the opinion that if you have competitors, you have to kill them. If you could put them against a wall and machine gun them all the better aggressive, but I get the point Drabinsky wanted the then imperial to himself. By this time in its life, the theater had been carved up into a bunch of different configurations, spread over three separate lots. In his pursuit of a movie theater monopoly, Drabinsky happened upon a very important detail.

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Famous players to not actually own the entire building. Right, although they own the auditorium, they did not own a strip of land from Young Street to Victoria.

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That section of the theater was owned by a mature woman in Michigan. So Drabinsky and his associates paid her a visit and then they offered her a better priced and famous players.

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Famous players had taken her for granted and had, you know, just assumed every year it would just be renewed. The lease. Right.

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OK, now here's where it gets juicy. Not long after the lady signs the lease over to Drew Pinsky, some famous players, folks show up at the theater and the doors are padlocked.

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I love and they could not get in so devious. So as they were caught off guard, they didn't know what to do.

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Drabinsky had locked the part of the theater that he now owned, which happened to be the main entrance to the theater, thus rendering the theater functionally inaccessible to the public.

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Don't hate the player, hate the game. The presence of famous players called your Pinsky's move, quote, unconscionable, irresponsible and unfair behavior.

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But it proved the Drabinsky was prepared to go to extraordinary lengths to get what he wanted. Instead of retreating, Drabinsky doubled down. He built his own small auditorium within the section of the Imperial that he now owned. The tactic almost bankrupted him, but he stuck with it and it worked.

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As soon as he opened that, famous players went back to the table and they agreed to sell him through the remainder of it as long as it was never used as a film exhibition hall.

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Drabinsky won big once the theater was his, he changed the name on the marquee back to Pantages and set about restoring it to its former glory faux marble, fake gold leaf and everything that all in take no prisoners approach would be a hallmark of Drabinsky career and ultimately what would bring down his Broadway production company and land him in some very unfashionable silver bracelets, but not before snagging theater's biggest prize. I'm Lauren Obama and from American Public Media. This is spectacular failures, the show that always lets failure take a star turn because she's a total diva.

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For Broadway impresario Garth Drabinsky, one of the defining moments of his life came at the end of a high school play after seeing his school's production of Moliere's comedy ballet, The Imaginary Invalid, Drabinsky decided then and there that he would be a person of the theater. He wrote about the moment in his presciently titled memoir, Closer to the Sun. Quote, I knew right away I wanted to be a part of this. It was a moment of genuine epiphany.

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I loved it at once. I've never heard of anyone so moved by watching a high school theater production. But that's just me. After high school, Drabinsky went to college and eventually became a lawyer in his hometown of Toronto, focusing on entertainment law. But the itch to make big time creative work had to be scratched.

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And in 1978, it was New York, New York, the Big Apple and the big time even for Garth Verbinski. In December, he opened his first Broadway show, a million dollar extravaganza called a Broadway Musical.

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It was literally called a Broadway musical. That's like me titling the show podcast in New York. Critics panned it and Drabinsky and his partner closed it after one performance.

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No joke, the show opened and closed on the same night. And I'm pretty sure that's not the way it's supposed to work. New York Times theater critic Mel Gussow had this to say about the show. Quote, The lyrics of one of the songs Run Nada, Nothing, Zero, Zip, which could suffice as a forward description for a Broadway musical. Ouch.

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But as Drabinsky told the CBC, he was undeterred.

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It's something that you have to get used to in this business because this business is run on word of mouth and run on on the response of critics. And I don't regret the involvement. I certainly have never been more passionately involved in anything that I've done.

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Drabinsky returned to Canada after his big Broadway bust. There, he signed on as a producer of the 1980 horror film The Changeling. It starred George C. Scott as a New Yorker who moves into a long abandoned house in Washington state. And guess what?

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The House is haunted within this old house live two residents. One of them is John Russell, composer professor. Has been dead for over 70 years. The film actually did pretty well in 2009, Martin Scorsese named to a list of scariest horror movies of all time.

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What is it about? Is it doing right? Trying to reach me? Why, Claire, why the changeling and experience beyond total fear?

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Careful listeners will know that I do not love scary movies, so for me, that's a passé.

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The film costs six point six million dollars, making it at the time the biggest budget feature in Canadian filmmaking history. Drabinsky raised that money in a very unorthodox way through an offering on the Ontario Securities Exchange, basically public shares in his film for a cool twenty five thousand dollars, investors could buy into Drabinsky film in exchange for some tax benefits.

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It was an unprecedented move, and at the time, Drabinsky called it an educational process right after The Changeling Drabinsky shifted gears to showing films rather than making them. In 1979, he co-founded the Cineplex Odeon Corporation, a movie exhibition business.

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Before Drabinsky Company came along, most movie theaters had one screen. Drabinsky changed all that with his idea for the modern multiplex when it opened at Toronto's Eaton Center. The Cineplex Odeon Theater was the largest movie theater in the world with 18 screens. It was a total game changer. Canadian art hung from the walls and the concession stand sold espresso and fresh pastries, along with popcorn slathered in real butter. For Cineplex Odeon, the Toronto multiplex was just the start.

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Soon, the company opened theaters all over North America. This expansion is when Drabinsky first caught the attention of New York Post theater critic Michael Redl.

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Garth sort of reinvented the notion of a movie palace, and the stories of the early stories were like, wow, this guy really is a visionary, you know, real butter on the popcorn. And he's doing art movies and he's going to have great seats and he's going to refurbish his theaters.

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Within a decade, Drabinsky Company had built more than eighteen hundred movie screens in five hundred locations. But all that success came with a whopping amount of debt. 10 years after Drabinsky revolutionized moviegoing, the company's board pushed him out.

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Garth was thrown out of Cineplex Odeon because he kept expanding and expanding. And, you know, Garth is somebody well, he's like America, actually. He has no fear of debt. I mean, he will take on debt like you would not believe. And I thought this is kind of interesting. Here's a guy, clearly a mogul, clearly a visionary, but he gets ahead of himself and he totally flamed out in the movie business.

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Now is as good a time as any to say that through his press, agent, Garth Drabinsky declined to chat with us for this story during his time at Cineplex Odeon. In addition to DODIG, North America with giant Multiplex's, Drabinsky had also built a live theater division as a part of his separation from the company. Drabinsky acquired that operation. He called it Levante, as well as Toronto's historic Pantages Theater from the top of the show. But the best part of Drabinsky is 88 million dollar golden handshake exit from Cineplex Odeon was the Canadian rights to Andrew Lloyd Webber?

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S cash cow, The Phantom of the Opera.

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I'm sorry, I had to zoa Drabinsky flunked out of the movie theater biz, but with a hit mega musical and fully restored theater in his pocket, Drabinsky set out to remake a name for himself in the theater world. And he did that in part with the Phantom Express, which was a bus.

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And it would bus people up from Rochester and Buffalo and Cleveland and Detroit, bus him up. You give him a hotel at a discounted rate and you give them the phantom experience. And he turned Toronto into a major theater town.

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Drabinsky correctly bet that folks would rather travel to Toronto to see Phantom. Canada's biggest city was way cheaper and way less hassle than Times Square. By some accounts, leavens Phantom was way more of a spectacle than the Broadway version. Cameron Mackintosh, the musical's original producer, told Michael Riedel that he later regretted his decision to sell Drabinsky the rights because he's got the Broadway Phantom right.

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He wants you to come to Broadway to see it. All of a sudden, he's got this competitor in Toronto who's taking his audience from Detroit and Chicago and every place else in the Midwest. And then Garth takes his phantom to Vancouver. Cameron's got his phantom in Seattle. What is Garth do? Garth advertises his phantom in the Seattle newspapers. It drives Cameron insane.

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Drabinsky Hustle might have ruffled a few Broadway feather boas, but it announced him as a force to be reckoned with. And in the early 90s, Drabinsky made a move back to the Great White Way.

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Levine's first major Broadway show was Kiss of the Spider Woman, starring show biz legend Chita Rivera.

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You've got to learn how not to be way too off.

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The show charmed audiences and critics alike. The Associated Press wrote that Kiss quote out dazzles every other song and dance extravaganza on Broadway. The New York Daily News proclaimed that the musical, quote, manages to be beautiful, funny and moving. This was redemption for Drabinsky.

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He had finally arrived at the American Theater Wing's Tony Award for Best Musical Goes to Kiss of the Spider Man, The Musical. Lining up, Drabinsky had gone from a one night Broadway bomb to beating out the Who's Tommy for the industry's biggest prize. And if that's not a comeback, I don't know what is.

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Thank you very much. And I hope that all Canadians are proud this evening where it all began in Canada. Thank you. In his memoir, Drabinsky wrote about the moment he won the Tony quote, Nothing else I've won has come close to this for the rest of my life. I can always be introduced as the Tony Award winning producer. Well, that's a nice title to have. It's true. It was a nice title, but Kiss of the Spider Woman wasn't exactly a box office smash.

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So he did it in Toronto where it never made any money. He did in London, where it never made any money. And then he came to New York, where it won, I think, six or seven Tony Awards, but still never made any money. The pattern of Garth's life, though, is, you know, it looks good, but it doesn't make any money.

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Now, for the layperson like me, it's kind of hard to understand how a show could win an armful of awards and not make any money.

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Luckily, a real Broadway producer is here to help. Professor Stephen Wilson runs the Graduate Theater Management and producing program at Columbia University. He's also worked on lots of Broadway shows, including the Tony Award winning musical The Band's Visit. He says that in the early days, the show lives and dies on the strength of its ticket sales. And at a minimum, the ticket sales have to be enough to cover weekly operating costs. But if you want to make money and who doesn't, that's a different ballgame.

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If week after week the value of your ticket sales exceeds your expenses and you're generating weekly net operating profits week after week after week, you're beginning to accumulate cash in the bank.

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And if you're a Broadway producer, you have a look see at that cash in the bank and you decide, can we afford to distribute some of this cash?

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And at that point, you start returning capital to your investors. So you start doing these distributions of your cash.

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This is called recouping. If you want to make a Broadway show, you find some investors to give you big money for the production with the hopes that the show will be a hit and they'll make a bundle. Recouping means you've just broken even. You've got to use the investors money and they get the prestige of having their name attached to your show. But that's about it. No one's getting rich, but only about twenty to twenty five percent of commercial productions recoup their investors cash, which means that the theater is not a place for risk averse investors like me to park their money.

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So of that 20 or 25 percent, it's a much smaller percentage that actually continue running and begin to actually give a return on investment.

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Now that is how an average Broadway show run by an average producer operates. Garth Stravinsky was absolutely not your average producer and Levent was not your average company.

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Remember when I told you that Drabinsky horror film The Changeling was financed through a public offering? Well, Drabinsky took that idea, injected it with jazz hands and a chorus line and came up with Levant's business model. By 1995, Levin had become the first publicly traded live theater company operating on both the Toronto and New York stock exchanges. It was an unprecedented move. Instead of relying on wealthy investors to foot the bill on a show by show basis, Drabinsky would be using a single pot of shareholder money to pay for all of his increasingly lavish productions.

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In Garth's case, I have always wondered, but it's purely wondering whether he went public as a way of sort of forgoing the traditional investor route.

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That's Jack Viertel. He's the senior vice president of Jujamcyn Theaters in New York, which owns five Broadway theaters and has produced just about all of your favorite shows, The Producers, Kinky Boots and Angels in America, to name a few.

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In other words, if he had if he could sell stock, he could use that money to produce shows. And the stock presumably represents the entire company, which meant theater holdings and other holdings. And, you know, that's a way of doing it. In my mind, the only really reasonable reason to do that is that you can't do it any other way.

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So you, Drabinsky, needed an extraordinary amount of money to mount his shows. These weren't rinky dink summer stock productions. Levante pulled out all the stops and going public gave him access to all the money he needed.

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You simply have a stockpile of funds from which you can do what you want to do, which is, you know, no doubt easier in terms of actually producing a show. But it's a it's a big deal to go public. So, you know, none of us did that.

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But when you are about to mount the most expensive musical ever produced a spare no expense revival of Showboat, you need a monster war chest.

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Theater critic Jeremy Gerard remembers Drabinsky inviting him to see previews of the show in Toronto, and we were rewarded with a truly spectacular show he wrote in his review at the time.

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If you've got the money, you'd better come up to see it, because there's no way this is coming to Broadway. It's too expensive. It's too big, it's too lavish. It'll never come.

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And of course, Gore proved me wrong when Showboat finally opened on Broadway in 1994. It costs more than 10 million dollars to produce live and we're spending more than 600000 dollars a week on the show. Tickets cost 75 dollars, which was a fortune at the time. But if you do a little back of the envelope math, you'll realize that in order to cover more than a half million dollars in weekly operating costs, you're going to have to sell a boatload of tickets.

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Critics like Michael Redl and Jeremy Gerard were going to the shows and they knew Liben wasn't selling nearly enough tickets to break even my first real run-In with with Garth.

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I was at Variety when he sent out a press release claiming that Showboat had recouped its production costs. And I refused to print it because I knew it wasn't true. And he was furious because he he wanted the imprimatur, both of The New York Times and a variety. And I said, I don't believe it because I knew how heavily the tickets were being discounted. And I knew that his costs on the production were extremely high.

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There is no way the show can ever make any money.

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It's just too expensive. And that was the very first tip off. I got that somehow Garth was doing something that didn't make economic sense. And that's when that's when I began to get suspicious, and that's when I began to kind of. Watch him with a wary eye, the extravagance of Showboat made the critics scratch their heads, but it was undeniably beautiful and thought provoking and innovative and an some more Tonys.

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But from a business standpoint, showboat like Kiss of the Spider Woman before it was a real curiosity, being big and grand on the one hand and doing a show that, you know, has is ambitious and complicated and will only appeal to a certain audience. On the other hand, is probably not a good business strategy.

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Showboat ran for almost a thousand shows, which is a lot of shows, but it kept running even though it was losing money and that was a huge red flag live and made other questionable financial decisions. It spent far more on advertising than other production companies, but it didn't include advertising costs when it added up the price of a show, even though that was standard practice. The company also neglected to tally the costs associated with developing a new show until after that show opened.

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So the shows, profit and loss statements were never quite right. On top of that, Drabinsky was known in the business for doing everything in-house, from the casting to the costumes to the marketing. And that, too, requires substantial cash flow. So does lavishing actors with salaries far above industry standards. Michael Riedel says the late, great Elaine Stritch got paid around twenty thousand dollars a week to sing one song a night in Showboat, and she sings it to the baby.

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So she's got this baby. And Elaine is not exactly the mothering kind, shall we say.

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Why do I love you? Why do you love me? And Elaine singing, she holds this baby in her hand. Why do I love you? Why don't you love me? Stephen Sondheim said, Is she going to sing to that baby or eat it?

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Oh, that's Stephen Sondheim always cracking wise live and produce some other shows after Showboat, including Christopher Plummer's One Man Play Barrymore and a revival of the comic operetta Candied again. None of them made any money. But, says Gerard, he didn't produce junk.

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He was interested in becoming a legitimate, important contributor to the tradition of the musical theater. And when you go down the list of shows that he produced, let's go through them. Showboat, Candied Barrymore, Kiss of the Spider Woman. These are shows that had real artistic integrity, that had a social conscience, that really wanted to accomplish something for all of Levant's artistic ambition.

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It hadn't yet produced an original musical building. A production from scratch is a notoriously high risk proposition. But in 1998, Drabinsky had a brand new Broadway theater, part of Levine's growing real estate holdings, and he needed to fill it with something the likes of which had never been seen before. And he did that with an ornate adaptation of E.L. Doctorow's sweeping novel, Ragtime. Marty Bell was the senior vice president of creative affairs at Libit. He says the vibe on Broadway at that time was kind of go big or go home.

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This was the era of Lamees, Fantham, Miss Saigon, Chest's Beauty and the Beast. The Lion King of Broadway at this time was becoming about spectacle, and I think our instinct was to be bigger than those shows. Remember, he started with Phantom of the Opera as they rehearsed ragtime.

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Drabinsky wanted the show to be bigger and bigger. Garth would say, Well, ADD had another character there adding the singer there, Garth used to spend this whole day on the phone. And I would say to him, I'm going to come to your desk, I'm going to lie down on your desk and put my head on the phone, and you're not going to be able to pick it up if you add another actor.

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In less than a decade, Levin had gone from owning one theater and producing one show to operating six theaters and running eight shows with another seven in the hopper. Drabinsky had reached master impresario status, but with other shows losing money and debt piling up, Levin needed Ragtime to be a major hit. Everything was riding on it.

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But, you know, it's really hard to do dethrone a show like Disney's The Lion King, which opened the same year directly across the street. See, The Lion King had eye popping acrobatics and elaborate masks and Simba and Rafiki and Hakuna Matata. But that's really hard to compete with when what you've got is a turn of the century epic featuring Booker T. Washington, Emma Goldman and the Charleston. It all came down to the Tony Awards.

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And the best new musical of 1998 is The Lion King. This is the absolute shock, and I wrote a column to the effect that I thought Garth Drabinsky must really be worried now because he needed that, Tony, for Ragtime to be a success. And then within within a year, the whole thing imploded and curtain.

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It's time for intermission. When we come back, how the contents of a briefcase vindicated skeptical critics and led to Broadway's biggest meltdown. Plus, we built a few bars with a Tony Award winning actress and an all new original musical number about accounting fraud that you're not going to want to miss.

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In 2001, the musical The Producers debuted on Broadway, it starred Nathan Lane as Max Bialystock, a morally flexible theatrical producer, and Matthew Broderick as his perpetually anxious accountant, Leo Bloom.

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The plot posed this idea.

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Jeez, you know, it really comes down to it. You can make more money with a flop than with a hit.

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That's my new best friend forever. Cady Huffman. Hi, my name is Cady Huffman and I was the original eeling Johnson, Benson, Yonce and telling Helen Spudding Swanson in The Producers on Broadway, for which we won 12 Tony Awards, and I got one of them.

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Lucky me, somebody had to win it.

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Now, the thing you need to know about this guy, Max Bialystock, failed fictional theatrical producer, is that historically his investors were oversexed elderly ladies with money to burn.

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Hello, gorgeous. Oh, me. Touch me as soon as I shut the door.

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I mean, they're the perfect investors for Max because they want Max.

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Did you bring the jacket? Really can't produce plays without Czechia. Here you go.

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To test out their theory that you can make more money by bombing than by succeeding.

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Bialystock and Bloom used a fancy financial maneuver called over capitalization, basically erasing way more money than you need if you raise more than 100 percent of the money, which should be Max's job to satisfy many little old ladies, to get them to write checks that if it's a big enough flop, then nobody will ever know that you raised more than 100 percent of the money because it'll just close and it'll go away.

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So I'll Bialystock and Bloom needed to do was find a guaranteed shit show. So they started their big search for the worst musical ever and, you know, piles of scripts everywhere.

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Finally, they find a script called Springtime for Hitler.

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Well, that's got to be a flop.

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Springtime for Hitler and Germany. It's time for. And naturally, it's material that would be so offensive that the show couldn't possibly last past intermission, the audience would revolt and all that little old lady investor money would be Bialystock and Bloom's.

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However, it becomes a huge hit the audience that the whole production was brilliant satire.

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I mean, how could they not? Hitler was played by an effeminate homosexual.

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Highlights last. Nischelle, I'm the German Ethel Merman, don't you know?

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So now they're in trouble because they were trying to make the worst show in the world and they made a huge hit. So now, of course, none of their backers are getting paid back and suddenly Max is left in jail.

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Obviously not how that scheme was supposed to go. Bialystock and Bloom had an accidental hit and their investors expected to get paid. Now I bring up the producers one, because it's an excellent show and you should totally see it. But to because there is this way in which Garth Drabinsky was a little like Max Bialystock, he was a larger than life character. He employed some creative accounting tactics and he was utterly convinced that his schemes would work. Plus, they were both keeping two sets of books.

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Hey, Sarge, look at this. What I found these two accounting books, this one says Show to the IRS and watch the other one say, never show to the IRS.

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Oh, man, you cannot make this stuff up. So many similarities.

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But unlike Bialystock, who banked on a flop, Drabinsky was convinced that Levante was a hit factory. Here's Professor Steven Jacobson.

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Garth was pretending it was a gigantic hit right then. The company was humongous, least successful. That's kind of persona and the kind of image he was trying to have out there in the world. But really, everything was flopping. So in a way, it's the opposite. Now, when you're playing with individual investors money, you can afford to have flop after flop after flop. As long as people continue to invest in you, there is no limit.

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There are producers who have had numerous failures and they keep plugging away.

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But when you are beholden to shareholders and a board of directors and pesky SEC regulations, you can't play fast and loose with other people's cash unless you are a too big to fail kind of company. Then by all means do what you like.

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You know, we've got your back because live it. It was publicly traded, its shareholders needed satisfaction and in 1998 they weren't getting it. The company was mired in debt to the tune of 160 million dollars in an effort to save the company. Two men, financier Roy Furman and super agent Michael Ovitz, put up 22 million dollars to buy a controlling stake in the company. Still, Drabinsky thought he needed just one hit to put the books back in the black.

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And the crazy thing was he got one.

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It was called Fosi, which made a fortune.

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Marty Bell remembers opening night on August 8th, 1998. We open farse in Toronto. After the show, with a cast party at a restaurant downtown Toronto and then Garth and I, as we did on opening night to most shows, went over to the ad agency to add the quotes from the reviews into our television commercial.

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The reviews started coming in and they were pretty glowing. But then Drabinsky got a call from Roy Fermín, one of Levant's new owners, and all of a sudden his whole demeanor changes.

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Suddenly there's something different about him.

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But Bélanger Pinski kept working until around 3:00 a.m. when they called it a night. And he said to me, if I get the review from the Globe and Mail, should I call you or do you want to wait till we get to the office? And I said, no, call me. I want to hear how we did. Six thirty in the morning, the phone rang and I thought it was Garthe with the review, but it was very farmand and he said to me, meet me at the Four Seasons and a half hour.

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And I turned to my wife and I said. Gaza out of here, the company's new management had discovered that Levant's accounting practices were more than just creative, they were fraudulent. So on the opening night of Fosi, Ovid's and Fermín locked Drabinsky out of his office. But inside that office was a briefcase.

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He left his briefcase at his office. So when they went into that briefcase, they actually saw ledgers for lieben books in God's own handwriting, him shifting numbers around to make things look better.

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Written in the margins of one of the briefcase documents was this damning command don't show to the new investors. Alistair MacLeod is a senior lecturer at the University of North Texas and an expert in accounting ethics and that no Drabinsky left doesn't surprise her one bit.

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When you deal with fraud, it seems like the same type of fraud repeats itself company after company. It's like the fraudsters, you know, only have a certain number of tunes in their jukebox.

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Did somebody say Tounes? Take it away, boys, gather round.

[00:32:41]

Here's a scandal or two about a guy, Garth Savitsky, who had some magic to do. He was one of those guys who threw sparks and your eyes. Just ignore my books, my dear, and we'll all get a prize. He had just opened Fosi about Bob's work and then left a paper trail more tangled than the love of Bobby. And Gwen left a note on his books waiting to be read. His partner found it and here is what it said.

[00:33:18]

Don't tell the new investors, don't you do it. Don't you dare.

[00:33:25]

One of the worst things they did, according to the SEC, was that they did something called capitalizing expenses to the balance sheet.

[00:33:34]

Capitalizing expenses means that you're shifting an expense such as a mortgage to the asset column.

[00:33:40]

So you get a double whammy. When you commit fraud like that, you get improvements on two of your financial statements.

[00:33:45]

So Levin was pretending some of its expenses were assets, thereby hiding 60 million dollars in losses.

[00:33:51]

Fraud is a concept word like common or distraught. They just took a little pink eraser out and they erased expenses off of their income statement and some of their liabilities off of their balance sheet opening address.

[00:34:07]

Another accounting maneuver that turned out to be illegal was overstating assets live and counted ticket sales as assets before the ticket buyers even saw the show.

[00:34:18]

You can't just willy nilly shift the recognition of revenues and expenses in a different period just because you want to. You know, that's not permitted. And so, you know, and that's part of accounting. You you tell it the way it is.

[00:34:30]

Basically, the company kept two sets of books, one with the real numbers, which were kind of trash and one with the sexed up numbers that they showed to their shareholders who were paying to keep this whole operation going.

[00:34:43]

He said, don't tell the new investors about the kickbacks. We'll all get a couple extra thousand cash bags and then we're else. Don't tell the new investors it's an ensemble number two, because if I go down, we all go down. That includes you. But I guess the biggest lesson yet to really learn is don't think about the evidence or you're past the point of no return. And fraud, and if that doesn't win as a Tony, I don't know, what will some of the accounting fraud discovered by the SEC and their Canadian counterparts was sophisticated.

[00:35:32]

But as we learned at the end of that very catchy tune, there were also just some garden variety kickbacks to the tune of seven million dollars. In addition to Garth Drabinsky and his business partner, Myron Gottlieb, seven other top executives were found to be in cahoots. In 2002, the Royal Canadian Mounted Police charged Levante co-founders Drabinsky and Gotlieb with defrauding investors and creditors out of 325 million dollars. The Canadian case against Levante took 11 years, but ultimately in 2009, the pair was found guilty of fraud and forgery.

[00:36:07]

Drabinsky got seven years in prison for his crimes. He served about two. For Michael Riedel's perspective, it was good riddance.

[00:36:14]

It didn't bother me to see him go because something that is lost sight of here is that when Garth went. He bankrupted a lot of little people. One of those folks was John Wilner in the 90s, Wilner was one half of an advertising agency that worked almost exclusively on Levante shows. Wilner says he was available for Drabinsky morning, noon and night because that was what the job demanded. And for the first few years of their working relationship, it went pretty well.

[00:36:41]

I had no knowledge or anything to do with how he ran his business. That wasn't my job, right? I just knew that, you know, we sent the bills on Friday that were paid, but then out of nowhere, Levin went belly up.

[00:36:53]

I get a call from Levante. Don't run any more ads. We're declaring bankruptcy. We're going to continue the shows. The shows will stay open, but we have no money.

[00:37:04]

Liben owed Wilmers Agency close to a million dollars. It was a huge blow to him and his business never recovered. Wellness Company limped along for two years before he shut it down. 35 people ultimately lost their jobs. So how much do you think that it cost you total to deal with all this?

[00:37:23]

Going to cost me my life, my country, my life, my my career cost me my career. You can't put it. You can't put a numeric fixture on my career. My career was over.

[00:37:36]

Today, Willner owns a real estate company on New York's Fire Island. But the feeling that Garth Drabinsky ruined his life is just below the surface. Now, you might think that someone who had been charged with defrauding investors out of hundreds of millions of dollars might lie low after getting out of prison, maybe get a little upstate's spread and volunteer at a local animal shelter or something, but not Drabinsky. Despite the collapse of Levante, Drabinsky continued to poke around the theater, even from prison.

[00:38:04]

In twenty seventeen, he produced a show in Toronto called Sousatzka, which was supposed to be his first stop on the Comeback Express. Here he is talking to the Canadian Press.

[00:38:14]

When the show opened, every musical that I've ever done, I've always felt public pressure because the shows have always been closely scrutinized by the media.

[00:38:27]

And I'm mindful of the fact that there is keen interest on the show.

[00:38:32]

But, you know, their world view has always been keen interest and everything that that I've been involved in the musical theatre.

[00:38:44]

But despite all the keen interest and the hype about the production being Broadway bound, the show is a dud.

[00:38:51]

I have been told that there are still a number of people who worked on the show who are owed money.

[00:38:55]

Here's my question. Why after Drabinsky upended his company, lost tons of investor money, went to prison and ruined people's lives, why would theaters and investors risk working with him again? That's a good question.

[00:39:10]

Why would people work with him? Because I think that he. He's he's he's selling an elixir and the elixir isn't that it's going to cure all your ills. The elixir is it's going to make you an artist. It's going to give you a place in history, and he's going to pay you really well to do it. And and that's very seductive.

[00:39:32]

Got Stravinsky has the ability to convince you that his next project is going to be the best musical you have ever seen in your life.

[00:39:40]

And that's you know, he is the music man, 76 trombones, the big parade with one hundred and Ten Commandments close at hand in the show, The Music Man, a traveling con artist, sets out to scam naive Midwesterners, but instead gets a lesson in morality from a pretty local librarian.

[00:40:01]

In Drabinsky case, he endeavoured to make a musical theater mogul of himself, but fleeced investors in the process and then got a lesson in fraud and forgery from the Canadian Mounties. Maybe you can make a show out of his life. We'll call it the musical man. And here's what the critics will say. It looks real good, but it'll never make any money.

[00:40:22]

Double bell euphonium, some big bassoons, each bassoon having his big fat. There were 50 mounted cannon spectacular failures as a production of American Public Media. It's written and hosted by me number one understudy Lauren Ober dance captain Whitney Jones is the show's producer. Our editor is lead soprano Phyllis Fletcher, senior carpenter. David Jor is our assistant producer. Our theme music is by the delightful David Schulman. Other original music this season comes from Jen Champion and Michael Cormier.

[00:40:58]

Christina Lopez is our audience engagement editor and Lauren Dezi is our executive producer concept by Tracy Mumford. The general manager of ABM's Studios is Lily Kim. So much love to Rodney Bush and Kevin Zak, the brilliant Broadway folks who composed and performed our smash hit Frode song Don't Tell. If you want to hear the song in its full glory, it'll be our newsletter. You can subscribe at Spectacular Failure Sorgi newsletter. Finally, super special thanks to our best Broadway bud Cady Huffman for entertaining us for free during our chat.

[00:41:33]

My name is Englehorn bin Sunil Santillan, Harland's Swanson and that was just my first name.

[00:41:44]

This is why I was like, man, if we don't have theater people in this piece, we are doing something wrong because they are the best high school theater people are the best.