Greed... is good," Michael Douglas famously pronounced as Gordon Gekko in 1987's Wall Street. Now the accusation of greed is being thrown at his first wife, Diandra, as they battle over whether she is entitled to part of his earnings from last year's Wall Street: Money Never Sleeps, since the original was made during their marriage. It's been 24 years since that tale of mercenary dealings defined an era and 11 since Michael officially split from Diandra to marry Welsh bombshell Catherine Zeta-Jones, resulting in one of the largest divorce settlements in Hollywood history: a reported $45 million, plus the couple's Santa Barbara, California, estate. Ratcheting up the drama was Michael's diagnosis of throat cancer last August, which came on the heels of their only son, Cameron, being sent to federal prison for five years for dealing drugs. It's all a recipe for a bubbling tabloid stew in which Diandra has found herself the prime ingredient since she filed her complaint last June.
"I am not a greedy person by nature," she says in her lilting voice as she sips a cup of tea by a roaring fire in the library of her townhouse on New York's Upper East Side. "I ask myself every night if I should walk away."
In fact, she takes pains to note that she did try to adjourn the case after finding out that Michael had stage IV throat cancer, but his side wanted to push forward. "Because we felt that it was a frivolous lawsuit and Michael did not need to have any further worries ... I thought it was better to proceed to get this matter adjudicated," says his attorney Marilyn Chinitz, a partner at Blank Rome. When Diandra called her ex-husband to express that she "was terribly sorry he was ill," he hung up on her, she says. "He doesn't recall hanging up on her," Chinitz says. "He might have addressed her in an abrupt manner. Michael just limits his contact with her only to the issue of their son."
Diandra emphasizes that Michael was seemingly in good health when she initially launched her bid. "Michael didn't know he was ill, I didn't know he was ill, and the gods didn't know he was ill," she says, her voice rising plaintively. "I am not into going after sick people for things that don't belong to me."
It's the first time Diandra has spoken at length about the case. At 54, she still has girlish mannerisms and well-tended skin, and she pads about her house barefoot in jeans, with a tangle of bracelets on one wrist and loops of African jewelry around her neck. "I didn't think it would turn into this huge media circus. That was not my intent," she says. But the suit has generated headlines around the world, and not the type that she would want to clip for her scrapbooks, which are filled with pictures of her and Michael in happier days. These scream, "Michael Douglas Battles Another Cancer: The Spiteful Ex" and "Portrait of a Hollywood Momster." Certainly, Diandra feels persecuted by all the bad press. "It's hurtful. I'm not made of cement. I'm a human being."
"I was surprised at all the nastiness," says Anne Hearst, an old friend. "People were making the cruelest comments about her parenting during a time when her son had gone to prison."
It would be easier, it seems, for Diandra to drop the case and just walk away. But she says, "One cannot live one's life based on the court of public opinion."
And she and her attorney Nancy Chemtob firmly believe that she should receive part of Michael's earnings from this movie. "It's nothing more than a business issue. Obviously, the other side feels that it's worth it, otherwise they would honor the agreement. My legal counsel says, 'This is something you are entitled to.'"
At the time of the divorce in 2000, Diandra notes, there were no plans for Money Never Sleeps. The terms about Michael's earnings from any related film were purely hypothetical. "I thought, You never know, but that might be a nest egg that I might need one day for my kids or my family or my life." And now that Michael's cancer is in remission, she is pressing ahead with her claim. The complaint was dismissed by a judge in New York (he ruled that the case should be tried in California, where the couple divorced), but Diandra has filed a notice of appeal as well as a motion to have her case reheard in New York.
Sagely presiding over all of this talk of court and lawyers is a framed image of Gandhi, who Diandra invokes as a personal hero. (She describes herself as a Buddhist, and statues of Buddha grace rooms throughout the airy, five-story home, which she has decorated with Asian curiosities, plush banquette couches, oil paintings, and dramatic glass chandeliers. Now that she's done with this project, she's planning to launch an interior-design firm, and a home-decorating show is in the works.)
Diandra has found herself the matriarch of a very full house: Besides her seven-year-old twin boys, Hudson and Hawk, who were born via surrogate while she was with former fiancé Zach Hampton Bacon III, a hedge-fund manager, with whom she shares custody, she's a single mother to her adopted Kazakh daughter, Imara, six; there are two dogs, Blanca and Blanca's "mini me," named Namaste; and her boyfriend, Paulo Oliveira, is a frequent presence.
In spite of, or perhaps due to, this crowded life, Diandra says the past few years have been "very difficult for me." In 2005, she married (then quickly divorced) entrepreneur and environmental activist Michael Klein. Her goddaughter, the heiress Casey Johnson, died suddenly. Meanwhile, Diandra took some financial hits. Her former business manager Kenneth Starr pled guilty to fraud, she was exposed to Bernie Madoff's Ponzi scheme through her investments in feeder fund Fairfield Greenwich Group, and the sale of her estate in the tony Santa Barbara enclave of Montecito fell through. (While it's on the market again for $29 million, Diandra is leasing it for events: Hilary Duff and Mike Comrie were the first to use it, for their August wedding.)
Her financial losses are a factor in her decision to pursue the case. "Because of the type of human being I aspire to be, if Starr & Company hadn't happened and Madoff hadn't happened, and if a lot of other things hadn't happened, to tell you the honest truth, I really believe I would have walked away."
There was once a more fairy-tale element to the Douglases' love story. A willowy, graceful diplomat's daughter with an aristocratic pout and a head of long blonde waves, Diandra met Michael Douglas when she was a 19-year-old student at Georgetown's Edmund A. Walsh School of Foreign Service. He was 32, and he proposed after two weeks. He married her six weeks later and whisked his prize to Los Angeles. The following year, son Cameron was born. But the Hollywood lifestyle proved a tough transition for Diandra, who had grown up in a small town on the Spanish island of Majorca before being sent to Swiss and American boarding schools. "I felt fairly lost in that world--the world of hype and endless make-believe," she says.
The couple moved to Santa Barbara and eventually New York City, where her position as Mrs. Douglas, combined with her cultivated background and striking looks, made her an instant hit. She did fundraising for the Red Cross and produced documentaries for the Metropolitan Museum of Art's Office of Film and Television. (She also teamed with Jacqueline Kennedy Onassis to host charity galas for the museum, including one at the Temple of Dendur.) She started modeling for Eileen Ford and appeared in the society pages, dressed by the likes of Oscar de la Renta, Calvin Klein, Carolina Herrera, and Donna Karan. Meanwhile, Michael was becoming a megastar with hits like Romancing the Stone, Fatal Attraction, The War of the Roses, Basic Instinct, and of course Wall Street.
Along the way, something soured. "For years, I've never said a word to anyone," she says of their relationship, which lasted for 18 years and included Michael's 1992 stint in rehab. "I don't feel that two wrongs make a right. I'm not into mudslinging, and I refuse to lower myself to even tell you the tip of the iceberg." Their son, Cameron, now 32, had his own battles: He sank into a full-blown heroin addiction and then began dealing methamphetamine, a charge to which he pled guilty last January.
"[There are] many famous families, the Kennedys [and others], who have had children who have been addicted to drugs, and I don't see anyone calling [any of the Kennedys] a 'momster.' It's absurd really," Diandra says. And, she points out, "in Hollywood, everyone we were surrounded with had issues with drugs and alcohol and made no attempt to hide it. It was an accepted badge of merit: 'I'm really successful now, so I can do whatever I want.' I didn't think it was very healthy for people I cared about and loved and certainly didn't think it was something that a young adolescent male should be exposed to on a regular basis."
Hearst adds, "The press quite harshly blamed Diandra for Cameron's problems, and I feel that it just shows how so many people don't understand addiction. It's such a serious thing, and it can happen to anybody. She and Michael were both loving with their son, got him the best help they could, and neither of them are to blame."
Diandra says she is determined to protect her younger children from following the same path. But she points out, "They have a different father, so that's one big difference." She has taken the three younger children to Lewisburg, Pennsylvania, to visit their big brother in prison, where he's now sober. "In this family, we don't believe in second chances. We believe in 20 chances," she says. She also has occasional phone calls with Michael about Cameron's progress. "We try to be civilized. We focus only on our son, and we don't bring anything else up.
"I loved Michael very much when I married him," Diandra says, sighing. "And I don't think love ever really disappears. It might metamorphose, [but] I certainly don't think that hate is the right recipe." She says she is not pained by Michael's new family with Zeta-Jones, whom she's never met, even though, per the divorce agreement, they share a vacation home on Majorca. ("How I've managed to keep my sanity through that, I'll never know," she says.) "I'm really happy that he is madly in love and has two lovely children," she insists.
Despite everything, including the reams of negative press and piles of legal bills, Diandra says she has learned to embrace the last couple of years. "Not because I'm a masochist, but this experience has made me a stronger human being. You find out who your real friends are when things like this happen. Some evaporate into the ether, and some circle their wagons. That's a great gift in and of itself," she says. "As horrible as this whole experience has been, I wouldn't change it."
