Keep refreshing for updates on this breaking news story…

4:20PM: As my sources predicted (below), Adam Goodman (photo right) will replace John Lesher (photo above) as the new President of the Paramount Film Group reporting to studio boss Brad Grey. In October 2008, Goodman moved from head of production at DreamWorks SKG to Paramount Pictures as President of Production overseeing a creative staff managing current DreamWorks projects and creative relationships as well as new development for Paramount. I guess you could say that one of DreamWorks SKG’s legacies was leaving behind an executive to run its former parent company. During and after the 2006 acquisition of DreamWorks SKG by Paramount, he helped steer Transformers, I Love You Man, Hotel for Dogs, Norbit, Blades of Glory, Disturbia, Tropic Thunder and Eagle Eye.

“Adam has proven himself to be a terrific executive with a track record of having shepherded some incredibly successful films,” Brad Grey said later in a studio news release finally issued at 5:15PM as Paramount scrambled for hours after my story posted. “We have worked closely with Adam over the last few years and look forward to expanding his duties.” Officially now, Paramount is calling this shapeup a “streamlining”.

bradweston3.jpg4:20PM: I just heard that Brad Grey asked Brad Weston (photo left) to also transition to a production deal on the lot. “Paramount wants him to be an active producer for them. They feel he has great talent relations and intend to give him projects so he can start making movies for the studio,” a Paramount insider tells me. “Brad’s strong relationships with filmmakers, his creative instincts and hard work have been strong assets for our studio,” Grey said later in the official studio press release. “We look forward to entering into the next phase of our relationship with him.”

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3:50PM UPDATE: I’ve just learned that my story today moved up Paramount’s timeline for the firing from “soon”, meaning in a couple of weeks, to this afternoon when Paramount finally told John Lesher that he’s out shortly after my story hit the Internet. I heard that Lesher received the bad news with dignity. (“Nikki Finke knew about it before I did,” he told a friend.) Now all their lawyers will negotiate a production deal at the studio for the fired exec. “John has made great contributions to Paramount and has nurtured a series of powerful films which have had a true cultural impact,” Grey said later in the official studio news release. “We look forward to working with him in the future.”

2:50PM: The way Paramount rolls, it’s hard to keep things private at that studio. (Remember all those Paramount vs DreamWorks leaks?) paramount-logo.jpgSo rumors have been all over the studio lot for the past 6 months that Brad Grey and Rob Moore were unhappy with John Lesher’s performance as president of the Paramount Film Group. I asked my sources if it was possible that Lesher would be pressured to exit. I was told it was under discussion but a final decision was not imminent. Then, in the past two weeks, Lesher himself began telling his pals that he thought he was “on borrowed time” as Grey and Moore “were in the process of figuring out what to do exactly with himself and [Brad] Weston and [Adam] Goodman.] When I went to my sources about it, one summed up: “He’s concerned about his future and sharing that with people, and he may come to the same conclusions other people have about where he’s at. But from an urgency perspective you’re not talking tomorrow, next week or even next month.” Asked if he would resign amid all the pressure, Lesher told friends, “Why would I want to do that?” Now, I can confirm that Lesher will be losing his job “soon”.

Which begs the question: What went wrong after only 18 months?

It’s been an unusual situation at the studio with three executives in very senior but seemingly similar positions: Lesher, who had been promoted from specialty division Paramount Vantage, where he had full or joint custody on Oscar-accoladed An Inconvenient Truth, Babel, There Will Be Blood and No Country For Old Men, to No. 3 at big Paramount with creative and production control of all the studio’s film labels; Adam Goodman who in December moved from DreamWorks to Paramount Pictures as President of Production overseeing a creative staff managing current DreamWorks projects and creative relationships as well as new development now for Paramount; and Brad Weston who continued as President of Production for Paramount Pictures once Lesher was brought in above him.

I broke the story back on December 5th that Paramount boss Grey was about to promote Lesher. Though in reality Grey might not have made the decision so quickly had there not been an uncomfortable confrontation that morning, Lesher sped up the process by bursting into Weston’s office and delivering the news of his coming promotion and Weston’s demotion in a brutal manner. “We want you around for the long haul,” Lesher told Weston. To which Weston responded, “I’m not stepping down and reporting to you.” It fell to Grey, who was in NYC at the time, to fly back to LA and sort everything out.

Grey’s special relationship with Lesher dates back to Brad’s Brillstein-Grey days when the Harvard grad who speaks Mandarin dazzled Grey with his overall smarts. The boss had grown even more comfortable with Lesher at Paramount Vantage where the two had developed Babel with Grey’s former client Brad Pitt. (On the night that Babel won the Golden Globe for Best Picture, Lesher gave up his seat mid-dinner so Grey could sit next to Pitt for the win.) Even before the promotion, Grey had been giving Lesher additional Paramount Pictures duties like handing him scripts to read and bringing him into greenlighting meetings. Because Brad liked how Lesher, a former United Talent and Endeavor motion picture lit agent, could talk the language of bigtime film directors which Grey, primarily a TV guy, could not. Brad’s thinking was that Lesher could bring quality, originality and talent relationships to a big studio slate. It was a gamble to be sure. Lesher’s naysayers warned at the time that John’s taste was too sophisticated for mainstream moviegoers.

But, by all accounts, that didn’t prove to be the source of Lesher’s problems in the new job. It was his style of management, or rather lack of it. Specifically, I’m told Lesher fell down in two areas: not greenlighting enough movies, and not behaving appropriately for the position. Paramount now finds itself with just a handful of non-DreamWorks pics in the pipeline and only 4 that Lesher can really claim credit for greenlighting: M Night Shyamalan’s The Last Airbender, the Martin Scorsese/Leonardo DiCaprio Shutter Island (considered a no-brainer since Scorsese has his deal there and Lesher used to rep him at Endeavor), Gore Verbinski’s animated pic with Johnny Depp Rango (an obvious go, but also Lesher has close ties to Depp’s agent Tracy Jacobs), and JJ Abrams-produced Morning Glory (another situation where Abrams has a deal with the studio). Lesher was told there wasn’t enough in the pipeline. But he didn’t pick up the pace.

In turn, he wasted a lot of time trying to develop a Beverly Hills Cop 4 with Eddie Murphy starring and Brett Ratner directing. When the project was announced, Lesher found himself the target of derision. As an insider told me back then, “Brad put him in the job because of his relationships with interesting filmmakers. Not to hire Brett Ratner.” Lesher also became bogged down in negotiations with Skip Brittenham and Jim Wiatt over Eddie’s deal. Murphy’s reps wanted a full-freight $25M against 20% of first-dollar gross. Lesher told them it was “past a reasonable starting point” in this declining DVD market. Yet Variety announced the project in May 2008 for a 2009 production start and a summer 2010 release. A few months later, Murphy’s Meet Dave tanked. Then Lesher wanted to see how video would shake out by the end of year. When those numbers plunged, BHC4 was dead by December. “It feels like the wrong moment,” Lesher told pals. “There’s no universe where we’re paying Eddie his full fee.” He wasn’t wrong. But there was nothing big in the works to fill the spot and even now Paramount’s slate has a huge gap between releases.

The problem for the Paramount bosses was not that the movie’s development died. But it was emblematic of a curious change in Lesher’s management style. “To defend John, putting movies together is incredibly hard. And he’s been in the business exactly when DVD peaked to when the movie biz got even harder,” a source tells me. “But at Vantage, he’d become known for aggressively supporting projects and people. But now people are feeling that he was not moving projects forward. There’s been frustations in the town and with talent that John [in the new job] has shown a lack of passion to champion projects and to get to see them get made.”

That disappointment came hand in hand with unprofessional behavior. “John is complicated” is the mantra repeated by even by his pals. (“John is complicated to figure out.” “John is a complicated dude in a million ways, and that’s not a secret to anyone — least of all Brad and Rob.”) Lesher has privately and repeatedly denied rumors about his personal life even during his Endeavor days. As one of my source confided, “Ari used to say that John was more work than any client they ever had. The servicing of John was epic.”)

By all accounts, Lesher was “more efficient and in a better place” back when he was at Paramount Vantage. But after his promotion, the stress of the new job showed. The result has been negative buzz about Lesher ever since he got the new job. To be fair, some of this can be attributed to jealousy, especially by agents. But also to his own brazen arrogance and unprofessional behavior. Like telling a screenwriter I know, “You must not be any good if I haven’t heard of you,” even though the scripter had credits with $1.5 billion worth of box office. And like the time, soon after taking over at Paramount Filmed Group, Lesher disappeared for 4 days in New York after appearing at the Toy Fair looking “incredibly disheveled”. Agents and managers began complaining about Lesher’s long and unexplained absences. “He vanishes after 1 PM and doesn’t return calls,” they told Paramount.

Lesher drew notice for looking “whacked out and shit-faced and falling down drunk” during the studio’s big Benjamin Buttons and Sweeney Todd screening parties. He’s been known to nod off in front of directors during their discussions. He’s been seen dozing on his office couch in the afternoons. That may be because he’s been up at 3 AM often making “incoherent and rambling and emotional” communications with his Paramount colleagues. For instance, Lesher’s bizarre wee-hour emails to Adam Goodman are now the stuff of legend. Even more famous is Lesher’s sobbing “I’m sorry” phone call to Nick Meyer back in December after Lesher pushed him out of Paramount Vantage. (As Lesher explained to pals later, “I was very upset for my friend. He has family. I put him in that job. I take things personally.”)

I know that, six months ago, Brad Grey was alarmed after being given an earful about Lesher and began considering who might fill the job. But there’s still not a short list, although some point to Adam Goodman as a logical successor.