Nicolas Cage sued his former money manager last month, claiming that he charged him exhorbitantly while he “placed Cage in numerous highly speculative and risky real estate investments, resulting in Cage suffering catastrophic losses.” Cage owes over $6 million in back taxes to the US government, and has defaulted on a $2 million bank loan. The Daily Beast recently had a jaw-dropping article that chronicled Cage’s insane spending. He would buy the latest high end luxury cars, about a new car a month, along with vintage cars, motorcycles, yachts, jewelry, exotic pets and anything that caught his fancy. He owned luxury homes around the world including castles in Germany and England and a 40 acre island in the Bahamas.

Cage is now being counter-sued by his former money manager, Samuel J. Levin, who worked for him from 2001 to 2008. Levin’s suit is fascinating, and basically confirms the Daily Beast’s account of Cage’s outrageous lifestyle. Levin claims he tried to work with Cage to get him to cut back and warned him repeatedly that he would have to stop spending or face financial ruin. Cage went along with the plan at first and started to sell off some of his assets, but then he started earning more and spending faster than he could keep up with.

Here are the most interesting parts of the counter complaint filed by Levin. Note that Cage is referred as “Coppola,” his given name:

In 2001, by the time Coppola hired Levin, Coppola had already squandered tens of millions of dollars he had earned as a movie star, he was deeply in debt, and he owed million of dollars [sic] in accrued but unpaid income taxes, with no funds available to pay the tax debt… Coppola knew all about his perilous financial situation and he knew he was behind on paying his taxes. Moreover, after making an initial evaluation… Levin warned Coppola that he needed to earn $30,000,000 a year just to maintain his lavish lifestyle…

For a while it looked like Levin’s objectives might be achieved, but the attempt to bring financial sense into Coppola’s life was short lived, because Coppola had a string of hit films, his earnings soared, and Coppola abandoned the economic conservatism he had agreed to with Levin. As Levin sold off automobiles, Coppola bought new ones. Then, Cross-defendant set off on a spending binge of epic proportions, and by July, 2008, Coppola owned 15 palatial homes around the world; four yachts (one for the Caribbean, one for the Mediterranean, one for Newport Beach and one for Rhode Island); an island in the Bahamas, a Gulfstream jet; and millions of dollars in jewelry and art. Commending in 2005 and with increasing urgency in 2006-2007, Levin implored Coppola to reduce his spending and build up a cash reserve as a defense against a potential economic downturn. Coppola rejected this advice and continued his compulsive spending. As a result, in 2007 Coppola’s shopping spree entailed the purchase of three additional residences at a total cost of more than $33,000,000; the purchase of 22 automobiles (including 9 Rolls Royces); 12 purchases of expensive jewelry; and 47 purchases of artwork and exotic items. Coppola also spent huge sums taking his sizeable entourage on costly vacations and threw enormous, Gatsby-style parties at his residences. Warnings by Levin that this spending was excessive and beyond Coppola’s means were not just ignored; at times Levin was rebuked for trying to restrain the outflow of cash. The pinnacle of Coppola’s spending spree came with his quixotic acquisitions of Milford Castle in England and Schloss Neidstein Castle in Bavaria. As a business manager, Levin borrowed and juggled and did was was necessary to pay Coppola’s bills, but Levin warned Coppola that the castles were decrepit and needed huge expenditures just to make them habitable – money which Coppola lacked. Coppola ignored Levin’s advice and bought both castles anyway.

[From PDF of Levin’s cross complaint, via TMZ]

The cross complaint goes on to say that Cage/Coppola’s lawsuit against Levin is patently false, because Levin didn’t place him in “speculative real estate investments,” he advised him against buying all those properties, cars, yachts, and other acquisitions. The language in the court filing is strong and convincing, and I found it really compelling. Levin argues that he charged 5% of Cage’s earnings, “a standard fee arrangement for a business manager, and perfectly reasonable, in light of the enormous amount of labor and staff time required to service Coppola’s archipelago of mansions scattered around the world.” Again, the cross complaint maintains that “the charging allegations of Coppola’s lawsuit are false, and Coppola knows them to be false… his losses are entirely and solely the result of his own compulsive, self-destructive spending, which he engaged in against Levin’s counsel and advice.”

I’m on the business manager’s side for sure. Nicolas Cage had a serious spending addiction and it seems to have finally caught up to him. This is some entertaining stuff, and I would love to see a movie based on Cage. We don’t know how this turns out yet, though. Cage could emerge from this fine if he’s able to keep his spending in check. That seems like it would entail a lot of therapy.

Thanks to Oxa for the tip!