The Mad Men of Los Angeles
Supergraphic multimillionaire Barry Rush couldn't have been pleased to hear a few weeks ago that Los Angeles City Attorney Carmen Trutanich had taken the audacious step of jailing a compatriot in arms, a Hollywood landlord who, for an undisclosed sum, cut a deal with a shadowy firm that draped an illegal supergraphic around a historic Hollywood Boulevard building.
The caper unfolded in the middle of the night, just in time for the giant, nonpermitted ad to appear in camera background shots for the Oscars. Trutanich's startling move, putting landlord Kayvan Setareh in jail and having$1 million in bail placed on his head, soon brought down the ad.
Rush, who many see as a chief bad boy in the murky world of illegal outdoor advertising, is used to a lot of public anger and attention — but not this much. His firm, World Wide Rush, had nothing to do with the Oscar scheme, but it had his M.O. all over it, tactics used by a handful of pioneers who've perfected the game of nonpermitted outdoor advertising in L.A. and other big cities.
Sounding highly defensive on the phone from his gorgeous, secluded home in Washington Crossing, Pennsylvania — known for its mansions, covered bridges and bucolic barns, and as the site of Washington's crossing of the Delaware River in 1776 — Rush wouldn't talk about Setareh's jailing.
"Most people, if you ask them about billboards, they don't have an opinion," Rush says. "Only a small majority have an opinion. Most people consider it as just part of the landscape."
Just days before Setareh was arrested, Trutanich also sued Rush, his wife, Leslye; their L.A. business partners, Paul Fisher, Scott Krantz, Peter Zackery; and their group enterprise, World Wide Mediacom.
The 97-page lawsuit alleged that 12 supergraphic locations belonging to Rush, Zackery, Krantz and Fisher are public nuisances that violate L.A.'s eight-year ban on supergraphics and billboards, and that World Wide Mediacom faces millions of dollars in fines.
"We are hoping if we take the profit away and meet them on their own turf, that it will eventually lead to property owners and advertisers and [illegal ad] installers realizing it is not worth it," Chief Assistant City Attorney Jeffrey Isaacs says.
But the sign barons, who have gotten rich slathering L.A. with nonpermitted, skyscraper-draped supergraphics as well as with small illegal poster ads on the walls of markets and stores, see themselves as the victims here — and some of their arguments have found traction with federal judges.
Rush, called a "mogul" by local bloggers and journalists, bristles at this. "I get my own mail," he says from his sprawling home on upscale Thistlewood Drive in Washington Crossing. "Moguls don't do that. I am truly not a mogul ... I am a guy sitting on my cell phone in my house. I don't have an office ... I live with my wife, dog and kids."
However, Trutanich and anticlutter activists say Rush is among a group of longtime friends and associates who work the system to erect illegal ads in L.A. They have long used the same lawyer — Rush's partner Fisher, now suspended and doing a year in jail for sex with a minor — to find in L.A.'s conflicting codes and practices loopholes they use to keep the city tied up in litigation while they reap huge profits.
Rush's other partners include West Hills resident Krantz, president of an affiliate known as Mediacom, who scouts the region for nonpermitted locations and negotiates with property owners and tenants willing to lease their land for outdoor ads. Zackery, who joined forces with Rush in 2007, lives in Pacific Palisades, spreads campaign money around to California politicians, and owns a company named for himself — City Wide Pete — which runs day-to-day operations for the parent company, World Wide Mediacom, LLC.
Zackery with his longtime friend Gary Shafner, another outdoor-ad guru, spent the 1990s plastering rock-concert posters and poster-style advertising on construction sites.
Shafner, now Zackery's partner, once worked for music promoter Bill Graham and was tour manager for Bob Dylan. Shafner cagily promotes himself as a force against blight and graffiti — while peppering buildings in L.A. with nonpermitted posters and small outdoor ads that have helped to make him rich.
Shafner exudes the indignant persona adopted by the group. In a twist typical of the Los Angeles City Council's policies on outdoor advertising, Shafner got the city's permission to glue poster-size ads on fences around construction sites all over L.A. — if he agreed to keep the areas free of graffiti. But, as Trutanich's office notes, the rest of Shafner's ads, nailed on stores and walls of buildings all over Los Angeles, "are illegal."
Shafner, Zackery, Rush and Krantz relied on attorney Fisher to come up with loopholes they use in court to keep their ads up as long as possible. But Fisher, 50, is serving a year in jail in Orange County for having felony sex with a drunk minor — a 15-year-old girl who prosecutors say was at a hotel for a wedding when Fisher, a stranger, took advantage of her in his hotel room.
A billboard-industry specialist, Fisher was hired three years ago by Rush to figure out how to get the courts to buy the argument that under the First Amendment, World Wide Mediacom's supergraphic locations, although illegal under L.A. codes, must be deemed legal sites.
Fisher helped to refine the technique known as the "billboard ambush," in which firms blindside city governments by embroiling city attorneys, city councils and city-code enforcers in litigation for years while the companies make millions in advertising dollars.
"He was one of the early practitioners," says San Diego lawyer Randall Morrison, who often represents cities in court.
Dennis Hathaway, L.A.'s leading anticlutter activist, breaks news of illegal-billboard antics on his Web site, banbillboardblight.org. Hathaway says leaders of the illegal-sign industry do not care about "the people working in offices whose windows they cover, and who could be at risk in a fire, or the pedestrians and motorists who might be endangered if one of those signs ... fell."
The techniques used by Shafner, Rush, Fisher and the others have worked beautifully in Los Angeles. The people Fisher represents reap easy profits, live well and inundate L.A. neighborhoods with advertising that is widely viewed as blight. "You remember the movie Jurassic Park, and the scientist character who said, 'Life finds a way'?" asks Luke Zamperini, a code-enforcement inspector for the Department of Building and Safety. "In this city, advertising finds a way. It doesn't matter, the laws we have. They find a way to have their ad up there anyway."
Well, maybe not for long. Trutanich is trying to turn the old formula on its head by being the aggressor instead of the defender. L.A.'s nonpermitted outdoor-advertising cabal is feeling the heat. Scoffs Rush, "I am not out there selling drugs and guns. I am engaging in free speech."
Gary Shafner's approach helps to explain why these men have succeeded as long as they have. Shafner is a political insider who threw a 2005 victory party for City Councilman Bill Rosendahl, and then a 2009 "evening with L.A. City Council member Bill Rosendahl" to help Rosendahl raise campaign money.
The bash was thrown in Shafner's unusual Venice manse, an apartment building on Clubhouse Court near Pacific Avenue converted into a fantasy living space decorated with vintage cars and an Airstream trailer atop the roof. Shafner's master bathroom is built into the cab of a truck; his vast closet is a replica of a Barneys.
Shafner knows about generating money, not just campaign cash. He began his career installing rock posters on construction-site fences for Bill Graham in the 1970s, and in the 1980s he formed National Promotions & Advertising with Zackery — and they pasted thousands of posters promoting rock shows and low-budget movies all over L.A.
In 1996, city inspectors confiscated more than 90,000 illegal posters, slapping NPA with a five-figure fine — $194.20 for the first poster and $1.60 for each duplicate. In an interview years ago with Los Angeles magazine, Shafner's partner Zackery, NPA's president, said: "It's not the kind of thing where I want to go out and advertise who I am."
Now, Trutanich's team is trying to undo the damage to the city created by a baffling tangle of compromises and exceptions granted to such advertisers by current and previous Los Angeles City Council members and mayors. The pattern has been that city politicians, such as Rosendahl, Eric Garcetti and Jan Perry, publicly denounce illegal signs and billboards — but cut exceptions to let a handful of companies thrive.
A few years ago, Shafner and Zackery struck up a deal with the City Council to stick their profit-generating posters — advertising rock shows and movies — on construction-site walls. In exchange, the pair agreed to remove graffiti within 500 feet of the sites. Yet nobody now at City Hall appears to be able to explain those old negotiations to L.A. Weekly.
In San Francisco, a similar advertising-in-exchange-for-graffiti-removal deal with Shafner was recently ended. San Francisco Beautiful had fought hard for a billboard ban and strongly opposed the graffiti deal. When the city let NPA cover the sides of stores there with outdoor ads, that was "like trying to fight blight with blight," recalls the group's president, Milo Hanke. "What was appalling is the city went along with this less than three years after the vote [to ban billboards]. We were very proud of the victory we had up here."
Shafner's ads today can be seen citywide, on the walls of Los Angeles liquor stores, donut shops, coin laundries, bakeries, Korean barbecues and beauty-supply stores. He claims his firm, Contest Promotions, applies for — and is awarded, by Building and Safety — legal permits. But according to code inspectors, Shafner uses a clever ruse: His company tells the city that it needs routine permits for "on-site" signs — legal signs that businesses like 7-Eleven or McDonald's put up solely to identify their respective locations.
Once Shafner has such a permit in hand, says Zamperini, instead of putting up a store sign, he puts up what city officials say is an illegal outdoor ad. Of 125 Contest Promotions locations recently inspected by the city, L.A. officials found that 98 had acquired ill-gotten "on-site" permits from the unsuspecting Department of Building and Safety.
Shafner seems almost to be living two lives. City Council President Garcetti, in his 2008 "State of Hollywood" speech, effusively praised Shafner and the CIM Group, owner of the Kodak Theatre, for working to bring the Cirque du Soleil show permanently to the theater. The Kodak was also the site of Shafner's luxurious and over-the-top wedding to Susan Koenig, featured in Inside Weddings magazine. He styles himself as a flamboyant lover of art and design, throwing open the doors of his eclectic home in Venice to such groups as the ModCom committee of the Los Angeles Conservancy, and letting the public inside during the Venice Art Walk.
But in Shafner's other life — the profitable business of advertising, in which Shafner, Rush, Zackery, Krantz and Fisher engage — he tries hard to stay under the radar.
Initially, when approached by the Weekly, Shafner said he would talk only off the record. Later he sent an e-mail, which read: "We are a locally based company that employs 80-plus people, cleans up graffiti on building sites across the city, including gang-related graffiti. We conduct our business in accordance with the applicable regulations and we have a well established record of being good corporate citizens. We are a company with a 20-year history of working with the city to support policies that both promote jobs and economic activity while respecting community concerns."
But Hathaway says, "There is no evidence that they care about the communities they blight with their signs."
Shafner uses a tactic in L.A. that he and jailed attorney Fisher introduced in San Francisco, where Contest Promotions placed a small sticker on nonpermitted eye-level outdoor ads, encouraging passersby to patronize the business inside. Once inside, pedestrians could fill out a form that made them eligible to win movie tickets or a poster.
According to San Francisco city officials, Shafner's company claims that the small stickers directing San Francisco pedestrians inside stores technically make the outdoor ads legal "on-site" signs, not unlike the identifying sign for, say, a 7-Eleven or a McDonald's.
"Their business model is they put up posters around town for an iPod or Virgin America, or 'Drink Coke,' or 'Go see a certain movie' — none of which you can do at the location they place them," explains Tom Lakritz, a city attorney in San Francisco. But when city inspectors cited Shafner's firm, Lakritz says, "they sued us."
Lakritz notes: "Their argument is that right above their poster they have a sticker that says, 'Win these and other prizes inside.' So they are claiming because you can enter a raffle inside [the store], that their illegal poster ads are the same as legal store signs."
Such arguments may seem a stretch, but San Francisco Beautiful's Hanke says, "These guys are very effective. The money to be made in billboard advertising is tremendous. They are very secretive about how much they make. It's a ruthless business."
In New York City, the blight created by NPA and Contest Promotions has set off an urban guerrilla-arts movement of sorts. Artist Jordan Seiler and members of his Public Ad Campaign activist group began covering the signs with large, colored squares. In one effort, the group covered more than 20,000 square feet of illegal ads with this "weave" art, and nine activists were arrested for criminal mischief. (Shafner insists he is a minority partner in the New York divisions of his firms.)
Seiler, who briefly brought his effort to Silver Lake last year, covering up a group of Contest Promotions posters on a Sunset Boulevard store, says he is trying to make urban residents realize that "if you have a problem with something in public, go out and do something. It is incredibly empowering."
It is impossible to know for sure, but some anticlutter activists believe that Barry Rush jumped into the anything-goes situation in L.A. when City Attorney Rocky Delgadillo cut a sweetheart deal with billboard firms Clear Channel Outdoor and CBS Outdoor in 2006 that became a welcome mat for illegal advertisers. (A judge has since called Delgadillo's concessions, approved by the current City Council, "poison" for L.A.)
Rush had just completed a lucrative deal in Miami after he erected illegal supergraphics in its downtown area. Eventually, he struck a compromise in which city leaders let him place eight supergraphics at prime freeway locations. In return, he pays a fee of $1 per month per square foot into Miami city coffers — amounting to about $500,000 per year.
As is typical with the group of associates now targeting L.A., pressure tactics are used to wear down local politicians. In Miami, "they put all the [supergraphics] up illegally — then went to the city and said, 'Let's craft a law and make them legal,' " recalls Kirk Nielsen, a former Miami New Times reporter whose investigation triggered regulatory reviews. "I guess he thought he could waltz in and sweet-talk people and he would save the city from the blight of billboards by putting up more. ... I don't blame him for making a lot of money. It's the hypocrisy."
The same year Rush targeted Miami, he began targeting San Francisco. His Metro Lights firm, which was sold to Fuel Outdoor in 2006, began mounting nonpermitted ads on the walls of convenience stores and gas stations. The San Francisco Planning Department hauled Rush before an administrative judge, to whom Metro Lights argued that the signs were really "on-site" promotions — a similar tactic to the one used by Shafner in L.A. and San Francisco. In 2004, Rush told the San Francisco Weekly: "We always try to be a good corporate citizen."
Some communities do not back down, as Miami did. In Philadelphia in 1999, Rush and his then-firm, Metro Lights, installed a massive, 9,750-square-foot, nonpermitted Gap supergraphic near the picturesque entrance to the historic district, flagrantly disregarding a ban on billboards.
Though he claimed that Philadelphia codes did not specifically ban supergraphics, homeowner groups and an antibillboard group — SCRUB — successfully appealed a decision by city zoning officials backing Rush.
"It was a huge eyesore," recalls Mary Tracy, president of Scenic America and founder of SCRUB — the Society Created to Reduce Urban Blight. "[Rush's position] worked for our politically stacked zoning board, which granted the variance — but did not succeed in the courts."
Tracy adds: "We had [Rush] here in Philadelphia, when he was just dipping his toe in the world of supergraphics. ... We were right there to stop him. Places that aren't so organized — he has found success."
In Los Angeles in 2007, Rush apparently decided he needed local knowledge to operate in the face of a longtime ban on new outdoor ads. He expanded beyond his company, World Wide Rush, creating World Wide Mediacom, LLC, and linking up with Zackery, Fisher and their associates Krantz, and Pamela Anderson, who claims on her Web site to be "the first lobbyist in the history of Los Angeles to secure entitlements for a type of 'supergraphic' used on glass high-rises."
Their plan, according to documents filed by Anderson during a later lawsuit, after her relationship with Zackery, Fisher, Rush and Krantz had soured, was to mimic Rush's strategy in Miami. They decided to put up gargantuan ads at 30 handpicked building sites in Los Angeles, wait for the city's building inspectors to try to enforce L.A.'s municipal codes — and then Fisher would seek a federal court injunction preventing L.A. from enforcing those codes.
After forcing a fight based both on First Amendment grounds and on the city's confusing array of exceptions to its own billboard ban, the apparent plan was to win injunctions from unsuspecting judges unaware of the larger, profit-driven strategy.
"If the partnership could obtain such a court injunction, this was expected to cause the premium Los Angeles leases to double or even triple in value," Anderson alleges.
According to the documents, Shafner recommended Anderson to Rush. She claimed Rush agreed to give her a tidy $50,000 monthly management fee and a 10 percent stake in the partnership. In one e-mail to her male associates, Anderson wrote: "The bottom line, only really relevant reason why I think you guys need me: It's 10:40 p.m. on Friday night. And I'm busy organizing the sale of your walls and plan to make you guys a ton of money."
In the meantime, attorney Fisher filed a federal lawsuit against Los Angeles for citing Rush's World Wide Rush for illegal supergraphics — the alleged strategy from the start. Fisher argued that L.A.'s 2002 billboard ban violated World Wide Rush's First Amendment right to free speech, and that city leaders were discriminating by forbidding "supergraphics" and billboards within 2,000 feet of freeways while making exceptions for other outdoor advertisers.
In the summer of 2008, U.S. District Court Judge Audrey Collins declared that World Wide Rush was likely to win its lawsuit. Collins criticized the Los Angeles City Council for ignoring its own billboard ban to approve a pair of 76-foot-tall, monster-size, double-faced billboards along the 10 freeway — then forbidding other billboard companies from ignoring the ban.
The City Council's blatant favoritism got Collins' attention because of City Councilwoman Jan Perry's plan, which allowed Clear Channel Outdoor to erect the two normally illegal, towering billboards on transit-authority land next to the 10 freeway. Under the bizarre arrangement, Clear Channel agreed to drop a bitter Santa Monica Boulevard billboard lawsuit against the MTA, and, in turn, the City Council approved Clear Channel's controversial freeway billboards. The MTA, in response, thanked the City Council by setting up an unrelated project in which MTA land was set aside for a wetland park in Councilwoman Jan Perry's district.
Collins apparently never realized she was playing into the hands of the illegal outdoor advertisers. When she issued a preliminary injunction blocking L.A. from enforcing its billboard ban against World Wide Rush — an injunction the city has since appealed — a flurry of copycat lawsuits was filed by other illegal advertisers, and a host of nonpermitted supergraphics sprouted up citywide.
Assistant City Attorney Isaacs says that jailed attorney Fisher "created this cottage industry for himself by creating these copycat lawsuits. ... It is a huge and calculated game where there [are] tens of millions of dollars at stake." A Trutanich aide, Jane Usher, says that 15 to 20 copycat lawsuits by "opportunistic companies" spearheaded mostly by Fisher were filed during four months in 2008.
With City Hall critics and billboard opponents loudly accusing the Los Angeles City Council of having brought this bad situation upon L.A. by granting glaring exceptions such as the Jan Perry wetlands deal, in late 2008 the chastened City Council approved a new rule to stop supergraphics. Then, during his 2009 election campaign, Trutanich promised to put illegal outdoor-ad operatives on the grill.
Now, Rush and his cronies are wondering if the game is over in L.A. They have reaped millions of dollars from their oil derricks in the sky — much of it, city officials say, illegally.
"I didn't come in the middle of the night," says an indignant Rush. "I came to the court of the land, and they gave me an injunction and said it was fine. If I lost in federal court, I would have gone home."
For its part, the City Attorney's Office has said it will continue its crackdown until all of the illegal signs, supergraphics and billboards come down. And so will citizens, say L.A.'s anticlutter activists.
Says Hathaway, the leader of the antibillboard movement, "They are in the business of making tons of money by creating what people in most neighborhoods consider blight, which diminishes property values — and their quality of life."
Contact the writer at email@example.com.
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