Showdown At The Apollo

Inner City Broadcasting and The Heritage Networks face-off for control of It's Showtime at the Apollo. Who will emerge the victor in this mega-bucks battle?

International] if that offer was equal to or less than what they had offered us. That was not the case. We received an offer that was greater than what they had offered us.”

Again, the interpretation of the con
tract language contributed to Sutton’s woes.

WHO GOT WHAT THEY WANTED?
The foundation ultimately did what it says was in its best interest. Not only did Mercado-Valdes’ $1.6 million offer nearly triple the fee from the previous contract but it also gave the foundation 100% ownership of the shows that will be created this year under the Showtime at the Apollo name. “Our being able to control the use of the brand is worth its weight in gold,” says Bernard. “The split was 50–50 with the previous owners of the license, but Heritage was willing to relinquish its equity in the show.”

It was easy for Mercado-Valdes to relinquish ownership rights of the show. He never owned them. But for Lancey and Sutton, who created, financed, and distributed the show–nurturing it until it became a valuable asset–giving up ownership rights has been a hard pill to swallow. Lancey maintains that ownership of the show was the linchpin of the negotiations, which former foundation President Johnson confirmed. “[The foundation] wanted more control of the product in terms of the brand and the show,” says Johnson. “We wanted greater say on how the brand would be depicted, and greater control over its use.”

The foundation gained more control over the Apollo program but at what cost? The foundation’s handling of the matter–negotiating by letters and lawyers, changing the bidding process midstream, and setting a mandate for controlling the show–may have given the appearance of a less than open process. Additionally, the foundation awarded the license to Mercado-Valdes, which opens it up to more second-guessing. Not only was he partially responsible for the 1998 lawsuit, which led to the change in the board, but community members questioned his character because he was sentenced to four months in jail in 1989 on a contempt of court charge for refusing to testify against a friend suspected of drug smuggling.

While Sutton may have legitimate concerns about the negotiations, he is not unscathed. After fighting the 1998 lawsuit against the foundation over contract language, his team underestimated the “strictly business” attitude of the new board and helped foster an atmosphere of distrust by putting forth a proposal with language and compensation clauses that were disputable. Unfortunately, Sutton’s past efforts to renovate the Apollo were not taken into account because the lawsuit made foundation board members cautious about giving the impression they were giving Sutton a favorable deal.

Although Dick Parsons, who is now chairman of the Apollo Theater Foundation, assures, “There is no effort to favor or disfavor anyone,” he explains that, “Given the history of the Apollo and the fact [that] this is a foundation that has obligations to the community …we felt that because the attorney general, the Daily News, and a lot of other people were watching, the right thing to

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