A Bright and Guilty Place Read online

  A nice drama, and a foreshadowing of Double Indemnity, the James M. Cain novella that Chandler would later help turn into a screenplay. In London, back at the turn of the century, Chandler had written poetry that was wistful and sadly noble. Now he lived and worked in a highly ignoble city where drunk people smashed into a car and, having taken out an opportunistic lawsuit, expected to cheat the insurance company and get away with it.

  Chandler took pride in his clear-sighted victories. He enjoyed jousting with insurance men and attorneys, finding some refuge from his personal unhappiness at the office. He played tennis with work colleagues and journeyed with them up the coast to college football games. He chased show girls at gala dinners and his weekend-long benders became notorious. This desperate behavior suggests F. Scott Fitzgerald, with whom Chandler has more in common than might at first be supposed. He was a Jazz Age guy in crisis, though at this point he still held his high-level job.

  Joseph Dabney had lost hundreds of thousands of dollars in the Julian Pete debacle. Unlike most who’d been bilked, he was an enormously rich man with power to seek redress. Opportunity came along in the shape of Arthur Loeb, a Julian Pete victim who nursed a special grievance, having lost an eye during a struggle at a stockholders’ meeting. Loeb had been on an unsuccessful mission of vengeance ever since. Now he was looking for partners to contribute the $20,000 he needed to pay a lawyer and initiate a suit that would charge numerous brokerage houses, and the Los Angeles Stock Exchange itself, with continuing to sell Julian Pete shares long after they knew of the over-issues. Dabney told his right-hand man Raymond Chandler to look into the matter. Having met with Loeb and Loeb’s attorney, a former Superior Court judge named Guy Crump, Chandler advised Dabney to go ahead, and Crump went to court on behalf of Dabney, Loeb, and various other Julian Pete stockholders.

  This lawsuit, demanding $15 million, would end in blackmail, robbery, fraud, and several murders: Leslie White would be sucked into its aftermath, as would Charlie Crawford and Dave Clark. Unwittingly, Raymond Chandler became a prime mover in a chain of action whose bloody consequences would later inspire episodes in his fiction.

  The lawsuit was filed on October 8, 1929. Three weeks later, on October 29, 1929, the day now known as Black Tuesday, Wall Street crashed. Stocks lost $24 billion in paper value in a single day—ten times the federal budget, more than the government had spent on WWI. “The market went over the edge of Niagara,” wrote historian Frederick Lewis Allen. “Orders to sell came in faster than human beings could conceivably record or deal with them.” More than 16 million shares were sold in one trading session. The value of major stocks like General Motors and United States Steel was cut by half. Westinghouse fell from 290 to 102. Warning signals had been there, largely ignored. The previous week, bankers at J. P. Morgan and elsewhere had pumped more than $240 million into the market, trying to shore up confidence. Even this desperate remedy failed. Universal prosperity and consumer utopia, as promised by the seemingly unstoppable bull market, were no longer around the corner. Instead the country knew the bitter taste of panic. America’s economic structure cracked wide open. Thousands of investors lost all their capital within a day. The hopes of a decade were smashed.

  Louis Adamic, the first literary debunker of the golden myth of Los Angeles, was in New York at the time, writing Dynamite!, his book about class violence in America. At its center would be a telling of the story of the Times building bombing. Adamic was so deep into his writing that he barely noticed the headlines about the Wall Street disaster. But, soon after, he was turning a corner onto Park Avenue when he heard a woman shriek. She stood on the sidewalk, mouth agape and half-hysterical. She’d seen a man leap to his death from the top of an apartment building. “Park Avenue was not safe to walk on any more. There were too many ruined financiers and speculators,” Adamic wrote.

  At first the crash seemed to many a temporary setback. “Investors may continue to purchase carefully but with the utmost confidence,” reported the New York Times, while Irving Fisher, economics professor at Yale and the possessor of another cloudy crystal ball, noted that the market was merely “shaking out the lunatic fringe.” “WALL ST LAYS AN EGG,” said the headline in Variety, not exactly fearing the end of the world. We know now that the wipeout of October 29 presaged a wider collapse, the crumbling of American confidence and prosperity, hard times. The shock would be delayed but America’s optimism was broken. A cycle of mass thinking was over, and the slide into the Great Depression had begun. The booming L.A. of the 1920s had been a parody of the frontier spirit. Now farce was about to turn into a darker reality.

  15

  Entrapment of a News Hound

  Photographs of Leontine Johnson, the former secretary to larcenous Julian Pete chairman S. C. Lewis, show an attractive brunette in her late twenties, wearing a cloche hat with her lips thickly rouged. After the collapse of Julian Pete she’d worked for Will Hays in the newly formed film censor’s office, and she liked to boast of her references and her integrity. “I have been kind, benevolent and generous. I came from a little Georgia town and have lived a clean, upright, and honorable life,” she said. This image of innocence belied the reality of a tough cookie taking care of herself in a city where everybody was on the make. She was another creature of the era, and she at once took center stage in the $15 million lawsuit that Raymond Chandler helped bring on behalf of Joseph Dabney and others. Chandler was present with Dabney’s attorneys when Leontine Johnson gave the deposition in which she spoke of the “little gray account book” that was in her possession and the two suitcases stuffed with papers that she’d taken from the Julian Pete offices. These documents, it was supposed, would blow the lid off the entire mess and help secure Dabney victory in the lawsuit. She said that S. C. Lewis had already offered her $30,000 if she’d give this material back. She’d refused, whereupon Lewis increased his offer to $100,000—or so she claimed: Leontine Johnson would soon prove to be a self-serving and crooked witness. Her shenanigans would ensure that the Dabney lawsuit dragged on for years; they would also help usher in the bloody climax of the Julian Pete fiasco.

  Proceedings in the lawsuit began in mid-February 1930. The trial’s early days were pretty routine for L.A. at this time, which is to say that Leontine Johnson looked a knockout on the stand, then wept, then fainted and had to take a day off while her attorney told the press that she was in a state of nervous collapse. She returned to tell how $10,000 had been paid to bribe a juror in the first Julian Pete trial and how she’d hired a Slavic language instructor to coach S. C. Lewis when, at one point, he’d been planning to flee to the Soviet Union.

  This was juicy, but Leontine Johnson was already plotting her big coup. She’d teamed up with Examiner reporter Morris Lavine to tell, and sell, her story. In a town filled with tough-mouthed newsmen, Lavine was already something of a legend, a character who might have stepped straight out of Ben Hecht and Charles MacArthur’s 1928 newspaper comedy The Front Page. Lavine made his first contribution to a paper when he was only fourteen and paid his way through UC Berkeley by writing journalism on the side before joining the Examiner in the early 1920s. It had been Lavine who, in 1922, ventured to Honduras and tracked down hammer murderess Clara “Tiger Woman” Phillips after her escape from jail, inducing her to return to California and face a life sentence. It had been Lavine who had wrung a confession of murder from Herb Wilson, known as the “Preacher Mail Bandit.” It had been Lavine who discovered the bloodstains that led to the arrest of William Edward Hickman, and Lavine who had been credited with the first exposé of Julian Pete in 1927. He was a handsome big man, persuasive and confident, not merely a reporter but an action magnet who kicked his stories into another cycle by virtue of his own involvement.

  Lavine shut himself away with Leontine Johnson in her apartment at 236 S. Coronado Street, pounding at a typewriter while he doctored her tale. The first installment of “My Three Years with S. C. Lewis, or The Truth about Julian Pete,” appeared in the Examiner on
March 10, offering the titillating information that Lewis had rented three downtown hotel suites a day to conduct business and had “spent money as fast as he got it.” The excerpt was presented as a teaser, a taste of deeper and darker revelations to come.

  Again, this was all par for the course: an attractive witness in a scandalous trial had sold her story to the press—not exactly praiseworthy, but predictable enough. Then the big twist happened: a plot development of which Leslie White, or even Raymond Chandler, might have been proud.

  On the morning of March 10, White was summoned to see his friend Blayney Matthews, the new head of the D.A.’s investigative bureau, Lucien Wheeler having quit (as he’d told Buron Fitts he would) to set up a private detective agency.

  “You know Charlie Crawford, I suppose,” said Matthews to White, more of a flat statement than a question. “Of course,” replied White.

  Matthews said that a case had come up and he wanted White to get over to Crawford’s office right away.

  “I won’t force you to take this assignment, Les,” said Matthews. “There may be political risks. But if you want it …”

  White, sensing story material, grabbed at the chance.

  Crawford’s office was in a building he owned at 6665 Sunset Boulevard in Hollywood, a nondescript California bungalow resembling a residence rather than a business. A photographer and a realtor rented some of the space from Crawford. On the porch, ivy trailed down from hanging baskets, and cactus and aloe grew in terracotta planters.

  Crawford’s lair was at the back, entered either through an interior door or French doors that opened onto a side alley. The room was paneled almost to the ceiling with dark wood and there were hat stands and leather-backed chairs. Light seeped through a skylight, glinting off a big steel safe. There was a fan raised high on a shelf in one corner. A Tiffany lamp stood on the massive desk beside a cigar box and four telephones, one of which, White understood, had been a direct line to the office of the district attorney during the regime of Asa Keyes. This was where Crawford, the Gray Wolf, pulled his strings and did his business.

  White was struck by the steel mesh that covered the skylight. Wires ran from the ceiling and from a button on the side of the desk to an alarm bell on the wall. The doors were fitted with special locks and steel bars that could be slid into place. Crawford was either very cautious or very afraid.

  Crawford remembered that he’d met White before, in the Hall of Justice, during the Callie Grimes fiasco. Crawford shook White’s hand and said he was expecting a visitor any moment. The visitor soon to walk in through the French doors would be Morris Lavine.

  White hid himself; it had all been meticulously planned by Crawford.

  “When Lavine entered through the French doors, he unsuspectingly dropped into a chair that placed his head less than two feet from where I stood, with only a thin panel intervening,” White later wrote.

  With his ear pressed to the wall, Leslie White listened while Crawford urged Lavine to talk and Lavine fell for it, asking Crawford if he’d seen the Examiner, and warning that unless he “bought” the documents in Leontine Johnson’s possession he’d be exposed. Crawford agreed to pay up.

  “Have you got the money?” Lavine asked.

  “Now, remember, I don’t want to be blasted any more in the paper,” Crawford said.

  “That’s all right, you know me,” Lavine said.

  “The $50,000 is for you. The rest is for the girl,” said Crawford.

  White later described how, through the thin partition, he heard the crackling of crisp bills as they were counted out.

  “I don’t want to be chiseled anymore. I’m just doing this to protect my gray-haired mother,” Crawford said, making White, in his hiding place, smile.

  Lavine checked that all the money was there and left, only to find Blayney Matthews waiting when he came out through the French doors and stepped into the street. Matthews tapped Lavine on the shoulder, informed him that he was under arrest, and took him back into Crawford’s office.

  “I jerked open his coat and relieved him of a loaded forty-five Colt automatic pistol, which hung loose in the armhole of his vest. From an inner pocket, I retrieved the seventy-five one thousand dollar bills,” wrote White.

  The money had been wrapped in newspaper in two separate packages. White checked the serial numbers of the bills and stored them away as evidence while the great Morris Lavine, for once at a loss for words, slumped in a chair.

  “This is what happens when you shake down your friends,” Crawford said. “It pays to be honest.”

  Lavine tried to protest: he could explain all this, he said.

  “Morrie, you’re just a blackmailer,” Crawford said.

  Leontine Johnson was arrested within the hour. No further portion of her story was ever published in the Examiner, and the Dabney lawsuit was left in disarray. Johnson blamed Lavine, swearing she knew nothing about blackmail. Lavine himself said he’d been framed, set up by Crawford to stop the Examiner series. Buron Fitts, though, got his hands on the little gray notebook and the two suitcases “stuffed with documentary dynamite,” guaranteeing future developments.

  On the evening of the two arrests, White left the Hall of Justice and drove with Blayney Matthews and a stenographer back to Hollywood where, in a suite at the Roosevelt Hotel, they took Crawford’s formal statement. It came out that Lavine had been to see Crawford the previous day, a step in his plan to extort Crawford and several others who’d been involved in a Julian Pete “ring,” including Kent Parrot and California State Securities Commissioner Jack Friedlander. Through Kent Parrot, Crawford had informed Buron Fitts and the D.A.’s office of the plot, and they’d agreed to entrap Lavine.

  Crawford had just used the D.A.’s office as his pawn and he had an amused look in his eye. He rattled the change in his pocket and gave White a wink. He helped himself to whiskey from a decanter, and White gathered that Crawford kept the suite here at the hotel permanently, as a base of operations that he could sometimes use away from his office, his home, and the other real estate he owned around the city.

  As the D.A.’s men got ready to leave, Crawford reminded them that they had something of his—the $75,000. White assured him it would be returned at the end of Lavine’s trial. In fact, that money, as money often does, assumed its own life and created another story strand. Crawford never saw his $75,000 again. A mild-mannered and hitherto blameless county clerk would abscond with it and go on a stock market spree; by then Charlie Crawford would be dead.

  16

  Running with the Foxes

  Buron Fitts was taking a run at the California governorship. His campaign, and his ambition, added layers to the drama of the Julian Pete. For political reasons Fitts wanted, and needed, further prosecutions associated with the scandal. Documents in the suitcases seized from Leontine Johnson gave him ammunition, suggesting that Jack Friedlander, the state securities commissioner, had been in the pocket of the Julian Pete guys. Friedlander was the appointee of C. C. Young, the present governor, and Fitts’s chief rival in the race for the Republican nomination. Young, the documents suggested, had taken a $250,000 campaign contribution to give Friedlander the job.

  Here Fitts had a problem: that $250,000 contribution, if indeed it had been made, had come from the pocket of Jake Berman (aka Jack Bennett, by now known to the press as “Immunity Jack”) who was prone, according to the Examiner, to “prancing about the Hall of Justice with a proprietorial air.” Other documents in the Johnson trove provided evidence that Jack Roth, a stockbroker associated with Morris Lavine, had given bribes to Kent Parrot and Charlie Crawford, both of whom had been instrumental in C. C. Young’s previous gubernatorial campaign. This was another useful angle for Fitts so he assigned Dave Clark to look into the case. The whole murky stew began to bubble and boil.

  Fitts had made an enemy out of the Examiner and the paper attacked him for his alliance with the slippery Jake Berman. On March 19, 1930, the Examiner published an affidavit that had b
een sworn out by one of Berman’s crew, Carl Vianelli, who had been a bartender and guard at Berman’s home. Vianelli alleged that the bribery associated with the first Julian Pete case had been even worse than supposed. Berman, using his dentist as a front, had bought one of the jurors a house and had given another juror $25,000. Fitts worked hard to protect Berman, while hurrying Dave Clark and other assistant D.A.s to line up further indictments.

  The Rev. Bob Shuler entered the fray, both in his radio broadcasts and with a self-published pamphlet titled “Julian Thieves,” attacking Young and defending Fitts, who, Shuler argued, was “too brave, too splendidly fine” to be made a fool of, even by a “cunning human rat” like Jake Berman. “If he must grant him immunity that the corruption of the community be purged, well and good,” wrote Shuler. “Get all you can out of him, Buron, that will help produce justice and vindicate right.” Shuler was a partisan, a supporter who believed in Fitts as a transforming agent of reform. In reality Fitts was already sinking deep in the miasma of double-cross and corruption that he had pledged to eradicate.

  The Times published Berman’s grand jury deposition. Fitts had presented the Times with this document, in which Berman told of giving Morris Lavine $30,000 so that Lavine would run pro –Julian Pete articles in the rival Examiner. Berman also said he’d seen his former partner Lewis present Governor Young with $10,000 cash in a suite at the Biltmore Hotel. Berman, as before, presented himself as a plausible witness, while Fitts took further criticism for manipulating the grand jury for political ends.