Jared Paul Stern's big mistake is that he asked for Cash in exchange for good treatment by Page Six. This is a big NO NO.
Especially when dealing with a bare-knuckle kind of guy like Ron Burkle, a billionaire grocery magnate, who has a whole security team with former secret service agents on his payroll. The negotiations were video taped and found their way to front-page articles, first in the rival Daily News and then picked up by the New York Times.
The New York Post's Page Six, which Stern worked for, is the most powerful gossip column in the world. It is required reading for moguls, politicians, authors, and celebrities. Its often-brutal items can make or break careers. It has an uncanny knack for coming up with stories about the rich and powerful. It is the lynchpin of Rupert Murdoch's New York Post, whose circulation would plummet without the column.
So how do you get good publicity from Page Six? You have to be subtle, but if you are powerful, you can buy protection.
This past summer I called Richard Johnson, Editor of Page Six, with what I thought would be a gossipy bit of dirt, just up their alley, exposing the foibles of the rich and powerful.
Ed Klein, who was getting much attention for a rumor-filled smear book about Hillary Clinton, had been my editor at the New York Times Magazine. At one editorial meeting Klein bragged to me that Lou Rudin, a powerful NYC landlord, who was lobbying against rent control laws at the time, had recently given him a large rent-controlled Park Avenue apartment for a few hundred dollars per month.
In New York City a large rent-controlled prewar apartment, with lifetime tenancy, is literally worth millions. Klein explained that Rudin, head of the Association for a Better New York, had lots of rent-regulated apartments (real cheap) that he gave out to journalists, celebrities, and public officials. No specific quid pro quo was made, but it was kind of understood. When Lou called with a story, or something he wanted, you were expected to take his phone calls. He was a master at the game.
So, in a not so generous mood, I thought that Klein, after digging up all that dirt on Hillary Clinton, deserved a little payback. But Richard Johnson was not impressed.
"Everyone does it," Johnson told me. "It's not news. Rudin is very generous. He gives out lots of cheap apartments to reporters and people on the City and State payroll."
"In fact years ago, he gave me a cheap (rent-controlled) apartment on the Upper West Side." Johnson said as if to emphasize how common the practice is.
Rudin, (a good guy and a good source who died a few years ago), had bought himself protection. He always got good play on Post's Page Six, and from most of the papers in the city including the New York Times, the Daily News.
Now the chickens are coming home to roost for Page Six. Jared Paul Stern, a long time top editor, is being accused of extorting $220,000 from California billionaire Ron Burkle to insure that only good news about Burkle got on Page Six.
Apparently Stern was jealous of his boss Richard Johnson's more subtle payoffs and wanted some payola for himself. Stern told Burkle exactly how the deal would normally work. Johnson had a script deal for a movie "Jet Set" with producer Harvey Weinstein and Weinstein always got good play on Page Six. Billionaire Ronald Perelman put Johnson's fiancé, Sessa von Richthofen, on his company payroll in the public relations department and Perelman got good publicity. Johnson is reported to make $300,000 per year from the Post.
The way the game is played, Stern explained to Burkle, is that you have to become a source to get insulated. It's a protection racquet where the currency is gossip and dirt. You give them good juicy muck about your friends -- other powerful people and celebrities -- and they leave you alone. Stern at first asked Burkle to pass on dirt about his friends: Bill and Hillary Clinton, Leo DiCaprio, Sean (Diddy) Combs, and Gov Arnold Schwarzenegger. When Burkle refused, Stern asked for the cash, which led to his downfall and an investigation, which is bringing up embarrassing questions about Richard Johnson and the whole modus oporandi of Page Six.