The sure thing His Psychic Friends Network business is falling apart. He's got a long trail of lawsuits and loathing behind him. But Mike Lasky is undaunted. He knows he'll be back, and both friends and foes know better than to bet against him.

THE BALTIMORE SUN

Clarification

A story in Sunday's Today section on Baltimore entrepreneur Michael Lasky referred to back rent and unpaid loan payments owed the city of Baltimore by the owner of Harbor Inn Pier 5, a partnership including Lasky. The payments, totaling more than $158,000, were made the week the story went to press.

Mike Lasky can see it. He gets these visions, you could say. Gifts from God, he calls them. He can see that this new thing, this radio talk-show, 900-number deal, this is going to be huge, much bigger than the Psychic Friends Network, the TV "infomercial" that made him King of Telephone Psychics. This is going to make Dionne Warwick and her Psychic Friends taking $3.99-a-minute calls look like a storefront palm reader with a bead curtain and a blue light bulb. That was yesterday, this is today. "My car doesn't have reverse," Lasky likes to tell people. "I don't have a rear-view mirror."

Lasky's warming to the subject, shifting his big frame in the chair. "I'm enjoying this right now," he says. His hazel eyes are framed today in delicate, silver-rimmed eyeglasses, matching the gray suit, the subtly patterned pale shirt, the navy-and-gray-striped tie. In the best days at Lasky's Inphomation Communications Inc., clothes arrived at the Pikesville office by the box. Delivery from Armani for Lasky -- president, CEO, "chief cook, bottle washer, the whole 9 yards," as he puts it. Michael Warren Lasky, dressed to kill as usual, eyeing his mark.

"This is the program to beat all programs," he's saying. He's got the numbers to back it up, from a test run a couple of years ago, he says. "We've never had these numbers with Psychic Friends Network."

Once again, Mike Lasky -- former tout, former health club owner, celebrated buyer of the most expensive baseball ever hit -- is on the move. In his mind's eye he's setting up the next tent show.

"I'm an idea man. I come up with ideas," he says. His newest? A nationally syndicated psychic radio show. Give callers on hold the option to switch to a 900-number psychic at $3.99 a minute. Sell psychic services, who knows what else. Sell the "hold" time to advertisers. A psychic magazine, half a million circulation, easy. Lasky can see it, just as he saw Psychic Friends -- a success, he says, "beyond anybody's wildest imagination. Except mine. I knew it. Saw it. I sensed it. I knew it would be the greatest thing since sliced bread."

But today something's wrong. The pitch doesn't seem to be working. Perhaps the trouble is the location. Today Lasky's not sitting in the Inphomation conference room, the one with the little lights hung low over the shiny dark table and the television screen rising from a console at the touch of a button. He's not in his Presidential Suite in the Harbor Inn Pier 5 -- a $1,500-a-night room with Jacuzzi, wet bar and big Inner Harbor views.

On this February morning Lasky is in the witness chair in U.S. Bankruptcy Court in Baltimore. He is under oath. He's addressing himself not to a prospective investor but to Judge James F. Schneider, a 50-year-old man with a courteous demeanor and a sense of humor but also with 16 years' experience on the bankruptcy bench. Schneider has heard a few stories in his time.

The judge is peering down at Lasky through tortoise-shell eyeglasses. With his receding hairline, delicate features, detached manner, it's as if George Will is sitting up there in a black robe. Schneider appears unimpressed with Lasky's Fabulous New Venture. He's concerned instead with Lasky's Defunct Last Venture: Inphomation, the parent company of Psychic Friends, a company that in 1994 reported $150 million in sales but now has filed for reorganization under Chapter 11. He's concerned with the $26 million in debts, the list of 200 creditors waiting to be paid, the motion before him by some of those creditors to boot Lasky out of management and approve a

federally appointed trustee to run things.

Lasky's got the solution, the salvation of his company. But Schneider doesn't share his enthusiasm.

"It looks like you're letting Inphomation go dormant while you open up another secret company," says Schneider. "What we're worried about is if Inphomation will go dead, all these creditors are not going to get a dime. ... What is your answer, Mr. Lasky?"

The small courtroom falls silent. It's the sound of worlds colliding, the world of accountability vs. Lasky's world of the Next Big Thing. At 56 years old, Lasky has probably opened and closed more businesses than everybody else in the courtroom combined: The horse racing tout sheet. The telephone sports-betting advisory service. The health club. The sports pager business. The direct-mail astrologer, "Roxanna." Always the next thing. Then came the new world of the 30-minute television infomercial, a world in which Lasky soared to the top, hailed in trade publications as a marketing genius, creator of the Psychic Friends Network, the most successful infomercial ever.

Now this. They're arguing about whether to take his company away from him. It's a plot hatched by a creditor, he believes, a man he once considered a friend.

What is his answer? At this moment, it seems, the answer is to call on another Lasky. Not Angry Lasky, the intimidating fellow with a sometimes vicious temper. Not Beneficent Lasky, a compassionate man, a fellow who gives away money as if he were the reformed Ebenezer Scrooge. Salesman Lasky appears to have failed, so now the court will hear from Suffering Lasky, victim of circumstances.

The greenish eyes well up. The silence is finally broken by Lasky's voice, faltering on the threshold of a sob.

"People say, 'How many children do you have? You have three children?' No, four. Inphomation is my child. I created it. There is no plan to sap money from Inphomation. No plan to do that ..."

Judge Schneider, looking down at a man nearly in tears, betrays no thoughts of his own, no discernible effect of the old Lasky magic, the force of a man who knows he always has The Answer.

"He's a powerful salesman," says Theresa Tharp, who worked for Inphomation on and off for 11 years. "He would make you believe that he could make your dreams come true. Whatever you wanted, he could make it happen. He would make you believe that."

Michael Warren Lasky has made a career spinning belief into gold. Proof of his skill is everywhere to be seen. Check out his silver Mercedes, his Aston Martin. The $1 million house in Hunt Valley or the $800,000 condominium in Aventura, Fla. The three-story office building he owns in Pikesville, with its marble-walled interior and a lobby hung with 25 television monitors playing the infomercials Lasky has wrought. Take a look at the Harbor Inn Pier 5, the new 71-room hotel on the east end of the Inner Harbor, with its polished-stone lobby floors and retro-chic motif. Lasky, as part of a five-person partnership, owns a piece of that, too.

Ah, but the city Finance Department now says the hotel with the glitzy facade is $135,000 behind in rent and loan payments to the city, which lent $2 million for its renovation. The hotel partnership denies any problem; the city seems confused about who is supposed to be keeping track of the money.

Confusion. Ambiguity. That's the Lasky story. In the world of a man who has made millions working the territory between reality and illusion, between the fact of superior knowledge and its appearance, things are often not as they seem.

Even the basic biography is hard to nail down. Lasky himself is circumspect at best. Talk to those familiar with him and a hush often descends. Little is said for publication. Some are in litigation with him, others fear losing any chance they might have of collecting money they are owed. Still others express vague fears of incurring the storied Lasky wrath.

Born Michael Warren Lasky in March 1942, the gregarious fellow with charm enough for three men has at times been known as Mike Warren and, less frequently, as William Cashem. A single identity wouldn't suit this story, a tale of ever-shifting details offered, ultimately, by a parade of less than reliable narrators: psychics, former telemarketers, rival lawyers, litigants, assorted ax-grinders. Lasky himself.

He confirms that he was raised in the East New York section of Brooklyn in a family of three sons with no money to throw around. After that, things get a little fuzzy. Lasky figures he arrived in Baltimore in the 1960s, but can't say exactly when. He says he came to help run a blood bank operated by "my uncle and his associate."

Soon enough, he became a familiar figure at the local racetracks. He'd received his first handicapping lessons from his father, Harvey Ames Lasky, a postal worker by occupation and a man whom Lasky clearly revered. A sculpted portrait of the late Harvey Ames Lasky is displayed in a niche in a white marble wall in the Inphomation lobby.

And why not? His middle son, erstwhile ruler of the defunct Psychic Friends Network, starts his career as a clairvoyant at the track, where he notices there's money in knowing what's going to happen next. In the early years in Baltimore, people might spot Lasky late at night in one diner or another, smoking cigarettes, drinking coffee, working his numbers, perfecting his systems.

For just $1, the word according to Mike Warren was available in a tout sheet called the Baltimore Bulletin. Later came tips on football, basketball, horses, whatever -- all available for a fee over the telephone from Mike Warren Sports. You could spend hundreds, thousands for the information, for the chance to team up with Mike Warren and find a little edge in a risky world.

Bettors knew him as the handsome guy in the tabloid advertisements, a guy with a confident smile and a bag full of promises: "This came from my best source and he is a man WHO IS NEVER WRONG." ... "ONLY 100 OF MY FRIENDS CAN GET THIS WINNER!" ... "I ABSOLUTELY KNOW WHO IS GOING TO WIN THE PREAKNESS STAKES!"

Inside the offices of Mike Warren Sports on Sisson Street, Lasky was the big guy with the shoulders of a fullback who walked with the confidence of a man making good money selling. What? Himself, mostly. He talked tough and was usually seen with a bodyguard or two. Every so often the troops would look up from their computer terminals and see him mounting the podium in front of the phone room. Time for a pep talk.

" 'You can get more money from people over a telephone than using a gun,' " he'd say, recalls Patrick Wolff, a Baltimore cabdriver who worked telephones for Lasky in 1989 and 1990. "That was his favorite statement. The sad part is, it's true."

But the most dramatic proof of this Lasky sales maxim was yet to come. By 1990, Lasky was on to the Next Big Thing.

His buddy John DiNatale, a veteran horse trainer, remembers the morning in 1991 when he first heard about it. He's sitting in Lasky's office drinking coffee, talking horses. Spread out on Lasky's desk is not the Daily Racing Form but -- get this -- an astrology chart. Lasky runs the idea by him. Picture this, he says, a national network of psychics. Readings available by telephone, through a 900-number. What do you think?

DiNatale looks at his friend and laughs. "I said, 'What are you doing over here? Are you going off the deep end? ... Are we going psychic or psycho?' " he recalls.

Some joke. In a few years, the 30-minute infomercial starring Dionne Warwick and "Psychic to the Stars" Linda M. Georgian would be the top-selling infomercial in the young history of the business. Calls come in by the millions at $3.99 a minute. Up to 1,200 psychics -- each having been interviewed and screened by other psychics -- are doing shift work, giving readings into telephone headsets from their living rooms and kitchens.

In the best years, Inphomation spends $1 million a week on advertising and grosses nearly three times that in sales. Like a vision of fame and fortune glowing in a crystal ball, it seems almost too good to be true.

But it is true, fabulously true, until reality begins to intrude. Lower-priced competitors. Higher advertising prices. An ever more crowded field of infomercials. Inphomation blames its demise on industry changes and several companies -- AT&T;, MCI Communications, among others -- withholding tens of millions owed it. People inside the company offer another version -- anonymously, of course. They say spending on advertising and infomercial production was out of control, that there was no system for checking the effectiveness of advertising, despite the enormous sums being spent on it.

"It just wasn't run like a business," says one former department head.

Now, several years later, there's another rude intrusion on the Lasky dream: U.S. Bankruptcy Court Judge Schneider. He explains that certain things are required of a "debtor in possession." That would be Lasky, the man driving away from bankruptcy court at the end of the day in a black Mercedes, heading back to the Harbor Inn's Presidential Suite, his business tens of millions in the hole.

The judge is hearing that certain rules are not being followed. He's hearing that company equipment was moved without the court's knowledge, that employees being paid under special court order were fired without notice to the court. He's hearing that the man in charge of company finances was sworn in as treasurer and signed the bankruptcy petition, but doesn't recall this happening or why.

An incredulous Lasky dismisses the notion that anything improper is going on. "I don't do things like that, it's not my personality," he tells the court. "Almost everything I do, I always go through my attorney. Because of myself, my family, my business. I believe in holding myself on high."

It's a refrain he echoes later in an hourlong interview. "The truth is just the truth. That's all that I am. Little people lie. I'm always dealing in truth."

He looks you in the eye and says it with such assurance that you might almost forget that you are talking to a man who has made his fortune selling sure bets and psychic readings. You might wonder if the state of Maryland wronged a good man when the Racing Commission cited Mike Warren Sports for deceptive advertising in the 1980s, when the state attorney general got after him for not refunding bad-bet money, as promised in his ads. Maybe the state was mistaken in taking him to court to get refunds for members of the Pikesville Nautilus Club, left in the lurch when Lasky abruptly closed the club in 1985. The U.S. Postal Service, too, when it shut down his direct-mail astrology operation in 1991, compelling Lasky not to admit anything improper, but to sign a cease and desist order.

Talk to Lasky and his lawyer and close adviser, Robert B. Schulman, and you learn that Lasky is a perennial innocent, just trying to do right in a world of corporate thieves, litigious liars, gossips, errant judges and know-nothing reporters.

Why, Schulman asks, is no one interested in all the good things Mike Lasky has done?

Indeed, as Inphomation's fortunes soared, Lasky's generous nature found a public expression. He established the Lasky Family Foundation, and for years has given money to such causes as the Johns Hopkins Pediatric Oncology Center, the Baltimore School for the Arts, the Baltimore Zoo, cystic fibrosis research.

For a couple of years Lasky paid for the holiday lighting of Baltimore's Washington Monument. A big baseball fan, he once financed a 30-minute documentary about Baltimore baseball for the Babe Ruth Museum. He's also lent the museum the baseball that former Orioles great Eddie Murray hit for his 500th home run in September 1996. Amid much public fanfare, Lasky announced he'd buy the ball from the fellow who caught it for hundreds of thousands of dollars. By far the most ever paid for a historically significant baseball, Lasky's move made national news.

It's this sort of big gesture that has made Lasky a figure on the Baltimore social circuit, attending the fund-raisers, being spotted the company of the local haute monde, people such as developers Otis Warren Jr. and John Paterakis, and Steve Geppi, owner of Baltimore magazine and part-owner of the Orioles.

But there's more to it than that. The quiet generosity, the stuff Lasky doesn't like to talk about or publicize, that's the true Lasky, many people say.

"Mr. Lasky's always been there for us," says Cheryelona Mirchandani-Sanchez, who worked for Lasky briefly and whose husband, Naresh Mirchandani, kept the books at Inphomation. "He's always reaching into his own pocket. You're not just an employee to Mike. You're a person."

When they needed money to repair their car, Lasky gave it to them. When they needed money for a down payment on a house, Lasky gave it to them. The house deal fell through, but Lasky told them to keep the money, she says.

Dawn Thomson, who worked for Lasky on and off for 18 years until early February, says when the boss spotted her driving to work in an old car a couple of years ago, he decided the car wasn't safe for her and her two children. He leased her a new Ford Contour for two years. He offered employees free tickets to Orioles games and bought everyone turkeys for Thanksgiving.

"If you get anything negative," says Thomson, 41, a legal secretary in Baltimore, "it's people who don't know the real Mike Lasky."

The "real Mike Lasky," now who would that be? A restless soul, it seems, ever in pursuit of grand ambitions. A man of extremes.

There's no reason to doubt the sincerity of those who speak highly of their former boss. But what about this Baltimore County Police Department report dated Sept. 16, 1997? What to make of that?

The report describes a second degree assault -- no injuries to speak of -- that occurred at Inphomation's office in Pikesville. It was filed by Barry F. Thomas, a former Inphomation staff artist who in September was still doing free-lance work for the company. He told police he went to the office for a meeting. At some point he began arguing with "the suspect," who "grabbed the victim by the throat, pushing him against the wall" and chasing him out into the parking lot, where he grabbed him again.

Thomas, 55, decided not to press criminal charges. Hence, the police provide a report that decribes the suspect only as Thomas' "ex-employer," a heavyset white man with hazel eyes and brown hair. Thomas declines comment. But three sources inside the company say the altercation occurred between Thomas and Lasky.

"Barry Thomas and I had some words, and that's it," Lasky says. He cannot say if those words were exchanged on the day described in the report. As far as he knows, he's not the other guy in the report.

But even the most enthusiastic Lasky boosters acknowledge he's got a bad temper. While some say it's harmless, others see it differently.

Former Inphomation staffer Theresa Tharp says Lasky's outbursts of temper were frightening because she had seen him brandish a handgun several times in the office.

"There were times I'd be in his office, he'd just pull it out," says Tharp, who has been in litigation with Lasky over allegedly stealing proprietary information.

Two other former employees, Darryl L. Godwin and Ricardo Hilliard, also say Lasky showed a gun around the office. Hilliard says Lasky once pointed a handgun at the folks working in the Mike Warren Sports phone room, warning them about stealing customer names.

Lasky can't figure out why people say such nasty things about him. This is just not him, he says. Sure, he kids around, he likes to make people laugh. Sure, he has a handgun permit, but he never showed a gun in the office. It's ridiculous, he says, hardly worth a response. If he did ever show a gun in the office, "Probably it was a water gun," he says. "I know my style of kibitzing."

In one press release from the Johns Hopkins Pediatric Oncology Center, benefactor Michael Lasky emerges as a combination of Mahatma Gandhi and Bill Gates. But then, what to make of the lawsuit filed in U.S. District Court by a Connecticut man who claims Lasky assaulted him at a dice table in Las Vegas two years ago?

The plaintiff, A. Walter Levine of Connecticut, claims that for no apparent reason, Lasky cursed, "battered" him and threw him to the floor as Levine sat down at a dice table at the Mirage Hotel and Casino in late January 1996.

Not quite, say Lasky and Schulman, who have counter-sued. They say Levine struck first. Lasky, 6-foot-3, about 225 pounds, says Levine slugged him in the mouth and drew blood. Levine, about 5-foot-10, is described in the suit as a man in his early 60s who at the time of the assault was recovering from cancer treatment and walking with a cane. Schulman smiles at that, says Levine was hardly the invalid described in the lawsuit. The case has yet to be settled or tried.

The pattern of suit and counter-suit has become part of the Lasky profile. Even as Inphomation began roaring into the infomercial stratosphere in the early 1990s, the flotsam of previous Lasky ventures continued drifting through the courts. In seven cases filed in 1991 and 1992, plaintiffs either won judgments or settled claims against Inphomation, the Baltimore Bulletin or Good Luck Inc., the direct-mail astrology operation. More recently, Inphomation won a judgment against a distributor for failing to deliver thousands of fishing-lure kits being sold in an award-winning infomercial.

Schulman dismisses the number of lawsuits as nothing unusual. But Jay Shepard, president of BureauCom of Longview, Wash., a company that for nine months did telephone switching work for the Psychic Friends Network, says there is a definite pattern.

"I know very few companies that have dealt with them that haven't come away frustrated," says Shepard, who worked for Inphomation in association with MCI. "I don't know any."

Even in the clear light of U.S. Bankruptcy Court, even for a lawyer questioning his subject under oath, pinning Mike Lasky down to understand what went on behind the smoky brown glass doors at Inphomation headquarters is difficult.

On the day Lasky testifies, Richard L. Wasserman, lawyer for the creditors hoping to put a trustee in charge of Inphomation, opens his cross-examination by asking Lasky to identify the people on Inphomation's board of directors.

"I don't know," Lasky replies.

L "When was the last time they had a meeting?" Wasserman asks.

"I don't know," Lasky says.

It goes on like this. Lasky expressing unfamiliarity with one of his infomercials or with the terms of a $500,000 loan he received from a friend in New York. At one point the judge warns Wasserman to stop repeating Lasky's answers -- in tones of rising incredulity -- as it "has the effect of denigrating the response."

After two hours on the stand, Lasky steps down. Despite some shaky moments, he looks confident. During a break, he kids with a lawyer for NationsBank, one of Inphomation's creditors, about getting another loan.

He believes he's got the facts on his side. He's got nothing to worry about. And one big creditor -- owed $527,000 -- has testified on his behalf, saying Lasky is the man to lead Inphomation back into solvency.

All through the long afternoon, Lasky is certain he will prevail. But as the closing arguments end, it's clear something's wrong. Judge Schneider hardly takes a breath before making his ruling. Certain things are required of a debtor in possession, he says. Certain rules of conduct apply.

"I've seen nothing but evidence of concealment, dishonesty and less than full disclosure," Schneider says. "In some cases I think I've heard evidence of criminal activity. ... A shell corporation has been established that has effectively taken over the operations of the debtor. ..."

Lasky leans forward in his seat in the spectator's gallery. He puts his head in his hands, rubs his temples, rubs his eyes.

"I have no hope this debtor can reorganize with the present management," Schneider continues. He calls Inphomation's management a "muddle" and "erratic."

"There's been an obvious attempt to cover the tracks of the debtor," he concludes. "That can't be done. I don't know how anybody thought it could be done."

That quickly, Lasky is out and a trustee is in. Lasky leans his arm on the back of the bench, hangs his head. He remains that way as the judge and the lawyers go over details of what can and

cannot be moved from the Inphomation office, who may or may not enter the building. Lasky's building, the one he bought and decorated with marble and tasteful pictures, with Inphomation's many awards for excellence, with a portrait of his father, Harvey Ames Lasky.

Sitting there listening to Schneider's decision, he'll say later, "was like sitting at my father's funeral. That's what it reminded me of."

He gets up, steps outside. Somebody gets him his coat. He goes out, gets in his car, drives around awhile. "Sometimes you think best when it's quiet," he says later.

He spends the evening at a restaurant downtown in the company of lawyers. Later, they move for reconsideration of the judge's decision, which Lasky calls "horrible." In the meantime they are cooperating with the trustee to get the company back on its feet. Right now, that's the Next Big Thing, Lasky says.

Those who know him, friends and foes alike, say he'll be back. Mike Lasky always finds a way. Former employee Suzanne Farabaugh believes in his magic touch. "Everything he touched he could turn into money," she says. Mike Lasky has always been able to evoke strong feelings from people: resentment, fear, disillusionment, but also faith.

It's like the story former Inphomation creative director Carter Clews tells about his father, Rev. Charles Gordon Clews, a United Methodist minister. Rev. Clews was walking through the Owings Mills Mall a few years ago wearing a Mike Warren Sports sweat shirt, the one that read: "1-800-MIKE WINS."

"A woman came up to him and said, 'Oh, I believe in him, Mike Warren.' My father says, 'Well, ma'am, everybody has to believe in something.' "

Pub Date: 3/08/98

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