One of the most infamous paragraphs in the history of modern investigative journalism was written by a member of the UC Berkeley journalism faculty, repudiating his own reporting about on of America’s most prominent gangsters.
Here’s what Lowell Bergman and his colleague wrote to ease themselves out of a multi-million-dollar lawsuit filed by, among others, Morris Barney Dalitz, the syndicate thug who ran the mob’s skimming operation in Las Vegas back in the days esnl was working his first daily newspaper job in Sin City:
“We feel it right to acknowledge the positive information received about you [Dalitz] in recent years and, accordingly, to express any regret for negative implication or unwarranted harm that you believe may have befallen you as a result of the Penthouse article.”
The article, “La Costa: The Hundred-Million-Dollar Resort with Criminal Clientele,” appeared in the March 1975 issue of Penthouse, and focused on the mob’s involvement in a posh golfing resort in North San Diego County, a few miles from Oceanside, where we joined the staff of the late Blade-Tribune in 1967, shortly after leaving the Las Vegas Review-Journal.
Our job had us covering Carlsbad, the adjacent town and closet to La Costa [the town’s city manager would soon take a posh job at the mob watering hole]. When a story took us to the resort, we found ourselves amazed when we looked at the membership board: Familiar names included Moe Dalitz [previously, and here], Frank Sinatra, Carl Cohen [the Sands casino manager who famously knocked out some of Sinatra’s teeth after the drunken crooner drove a golf cart through one of the hotel’s plate glass windows], and Don W. Reynolds, the publisher of the Review-Journal. For a fresh Vegas emigre, it felt like coming home.
We remember telling our managing editor the next day, “That La Costa looks like quite a place.”
We learned about the Penthouse story when a spotted an ad for it on the side of a bus in Los Angeles, where we had just started work for the Southern California Visitors Council — a gig we worked for a year before returning the ink-stained wretch trade at the late and much-lamented Santa Monica Evening Outlook.
We found the story of the resort’s financing by the mob-controlled Teamsters Central States Pension Fund fascinating, making sense of that membership board we’d seen seven years before.
But resort owners Merv Adelson, Irwin Molasky, Dalitz, and Allard Roen filed that $522 million lawsuit, and when push came to shove, the journalists folded, followed by Penthouse, with apologies accepted in exchange for each side bearing its own legal costs.
From the magazine’s 1985 skinback [a journalism term for what Kansas folks used to call “eating crow”], a declaration that Penthouse
did not mean to imply nor did it intend for its readers to believe that Messrs. Adelson and Molasky are or were members of organized crime or criminals. In addition, Penthouse acknowledges that all of the individual plaintiffs, including Messrs. Dalitz and Roen, have been extremely active in commendable civic and philanthropic activities which have earned them recognition from many estimable people. Furthermore Penthouse acknowledges that among plaintiffs’ successful business activities is the La Costa resort itself, one of the outstanding resort complexes of the world.
But now, 28 years after the settlement, comes conclusive proof that the journalists were right.
Here’s a telling quote from “Remembrance of Wings Past,” a remarkable profile of Merv Adelson by Bryan Burrough in the March edition of Vanity Fair:
The Rancho La Costa resort opened its doors to the public in 1965. From the outset Adelson could tell his dreams of escaping the Mafia had been dashed. “The first guests, they were all Teamsters!” he exclaims. And then Detroit and Chicago Mob bosses, all the way up to Meyer Lansky himself. “There were hundreds of them!” Adelson adds. “I couldn’t get rid of them! The Teamsters treated it like their country club. It got a real reputation. I didn’t like it at all. But I couldn’t stop it. We owed them money! What could I do?” His children were soon being teased with the same taunts they had heard in Las Vegas. He was trapped. A very rich trap, but a trap nevertheless.
Lansky was the mob’s money wizard, portrayed as “Hyman Roth” by Lee Strassberg in The Godfather, Part II, a man who got his start partnering with Bugsy Siegel [“Moe Green”] and Charlie “Lucky” Luciano:
Adelson is rather disingenuous in his interviews, claiming he had no idea who he’d gotten in bed with — hard to believe of anyone circulating in his circles in the Sin City of the 1950s and 1960s. Indeed, he claims, only with the publication of The Green Felt Jungle, a 1963 bestseller by Ed Reid and Ovid Demaris did he realize just who he’d partnered with in his Sin City business dealings.
The profile paints a picture of a down on his luck octogenarian, living in a Santa Monica apartment no larger than the walk-in closets of his salad days dwellings.
So Bergman’s skinback was a farce, and the Penthouse article he disavowed was right. It didn’t hurt Bergman’s career, since he went on to produce for 60 Minutes, then found himself a nice nest at UC Berkeley’s journalism school.
Somewhere in hell, Moe Dalitz must be laughing his boney ass off.