The Boys Who Burned a Billion Dollars

The 1995 Chapter 11 proceedings generated 360,000 pages in court filings. Vajna watched regretfully from afar, fretting about his former friend and furious that it had all gone wrong. ''Carolco should today be much bigger than New Line,'' insists Vajna. ''Look at the assets: Spider-Man, X-Men, Terminator, Total Recall, Rambo, and Stargate. You name it.'' Says Devlin: ''Think about it. Had they been able to keep Carolco going a little bit longer, the next two movies would have been Independence Day and Titanic. [Nearly] 3 billion dollars in worldwide box office.''

Kassar took a deal at Paramount, where he wasn't able to mount a single picture. Most of the sequel and character rights to Carolco's films went for $58 million to Canal+ (who then sold key portions to Fox, Sony, Miramax, and MGM). And the name of Kassar and Vajna's company became synonymous with hubris and excess. Finally, in 1997, one of the last remaining Carolco assets came up for auction: 50 percent of Terminator 3. Everyone considered Fox the favorite -- the company had a relationship with James Cameron, and he was talking about writing and directing the sequel. But two surprise bidders derailed them with a bid of $8 million: Mario Kassar and Andy Vajna.

''We were in Cannes on separate vacations,'' says Kassar. ''And we decided to have dinner. We were eating a pizza next to the old harbor. And me and Andy were walking and our friends, my wife, and other people were behind us. And I looked at him and said, 'Andy, you know what? Why don't we try it again? I've got nothing to lose. You've got nothing to lose.' And Andy was like, 'Why not? We did it before.' And that's how it happened. ''

A few months later, Kassar moved into Vajna's Cinergi offices and C2 Pictures was born. They called the old gang to let them know they were back and pulled together money for their Terminator bid. (The lion's share came from Vajna, but Kassar kicked in what he could by mortgaging a piece of beach property.) Then they made their move -- and those jaws in Hollywood dropped.

As it turned out, they hadn't changed a bit. After blindsiding Fox and their old friend Cameron -- and nearly destroying their relationship with him in the process -- they bought the second half of the rights. Then they found a new director in Jonathan Mostow. Cast Arnold. Blew a lot of stuff up. And made $150 million domestically.

Now T4 is in active development with Mostow and without Schwarzenegger. They're enmeshed in a breech-of-contract lawsuit with Sharon Stone over her deal for Basic Instinct 2. And Kassar adds that ''multiple, equally major projects'' are on the fast track. He flashes a gleaming grin when he says this. But would you expect anything different?

''We have more fun together,'' says Kassar, from the C2 offices, where their desks are once again facing each other. ''I mean, we argue, we don't agree on a lot of things. But it's like a marriage, we know how to handle each other. It's been almost 30 years between us.''

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