Magic Johnson

In 2000, Channing Johnson helped a church buy the Forum, and his life changed forever

Published in 2010 Southern California Super Lawyers — February 2010

Channing Johnson had no idea why Bishop Kenneth Ulmer was calling him. He didn’t know the man. Johnson is a corporate lawyer in Los Angeles; he is used to getting messages from guys in suits, not robes. Still, a bishop calls, you call him back. They agreed to meet over breakfast, and Ulmer dropped his bombshell before the bacon arrived.

“He told me he wanted to buy the Forum and he wanted my take on it,” Johnson says.

Wait. What? The Forum? Where the Lakers used to play?

That’s the one.

Now, Johnson had done a million deals by then, but he had never heard of anything like that. Churches didn’t buy sports arenas. None ever had before. Who was this guy?

Still, he was curious. He asked Ulmer to lay it out for him. And Ulmer, who is not shy, started preaching.

He told Johnson that he knew it sounded crazy, but his congregation was growing. It now numbered in the thousands. And the Forum was sitting vacant, right there in their neighborhood. And it was in danger of being torn down, and that would be a crying shame. So he thought the church should buy it. And not just to use on Sundays. That wouldn’t make any sense. But to lease out as a commercial venue. Like any other arena. Except owned by a church. No one was getting this. Money people were laughing him out of offices all over town. But he just knew it was a good idea. He could feel it. He just needed legal and strategic advice. He had heard Johnson was good at this type of thing. It was going to be beautiful. Wouldn’t he like to be a part of something like this?

Johnson paused and took a moment. Then gave him his take.

He could see that.

A year later Johnson had all the pieces in place. Twenty-four million. That was the price. Johnson had loan commitments for most of it from a syndicate of six banks, including Bank of America, and Ulmer managed to raise the rest. He had brought all the necessary strategic partners, from area politicians to chamber of commerce types, into the deal. It was all set.

Yet ink was still not on paper. And they had only one day left or the deal would fall apart. People were panicking. One banker in particular had been up for days and was starting to break down.

But Johnson was calm. He sensed other forces were at work.

“I know this doesn’t sound very lawyerish, but I really think that the most important element of that deal was prayer,” he says. “Every time it looked like the deal was dead, Kenny and his congregation engaged in prayer, and every time prayer was answered.”

The next day the documents, which covered two long rows of tables, were signed, and Ulmer became CEO of Forum Enterprises Inc., a church subsidiary designed by Johnson to manage the legendary venue.

That was 10 years ago. Ulmer still gets ecstatic talking about it.

“Believe me, this could never have happened without Channing, that is not hyperbole, I am telling you,” Ulmer says. “It was such a complicated, innovative, creative, unique deal—I don’t know of anyone else who could have joined that many diverse groups together and had the ability to dialogue, negotiate and communicate with all parties and find a common ground of consensus. It was amazing.”

Felt so to Johnson, too. Changed his life, certainly his law practice. “That was the deal where it all came together for me,” he says.

 

Today, Johnson, who is 58, is ensconced at Loeb & Loeb in Century City, just a five-minute drive from the home he shares in Cheviot Hills with his wife, a business manager at Provident Financial (“we share clients”), and four children. He’s no longer surprised when clergy call him. They call all the time. His job is to listen. They’re very wary of how their money is spent and how their actions are construed and require a lot of handholding. That’s fine by Johnson. He grew up in the pews of his Uncle Wilbur’s church in Pasadena. He speaks the language.

He also speaks the language of corporate finance. Not a lot of people do both as well as he. In fact he may be about it.

He’s a traditional mergers and acquisitions lawyer, but since that Forum deal he has built up a book of faith-based clients that represents about a fifth of his total workload. It’s a sizeable chunk, and wholly unexpected. “I certainly didn’t see any of it coming,” he says.

And heavens, check out his client list. Ulmer isn’t the only bishop. There’s also Clarence McClendon of Gardena, Calif., Remus Wright of Houston, and the biggest of the big these days, T.D. Jakes of Dallas, who’s become a worldwide brand in publishing and broadcasting, thanks in part to Johnson’s business savvy. “I represent his company, TDJ Enterprises, and do a lot of entertainment and media deals,” he says. “Nice guy.”

Johnson obviously has great affection for these leaders, but make no mistake, he values their deals as well as their ideals. He just plain loves deals. They’re like scripture to him.

“It’s true—I can’t get enough of them,” he says with his genial James Earl Jones laugh. “I get post-partum depression when they’re over.”

He never stays down for long. A big part of his success stems from his love of numbers, which he discovered as a young man. “When I was in high school, I did all of my father’s payroll, you know, cutting all the checks, doing all the calculations, handling the insurance. I loved it,” he says. This clearly didn’t make him Joe Hip Guy in the hallways at John Muir High, but so be it. The aptitude helped get him into Stanford, where he earned an economics degree.

He was taught to do more than achieve. He was raised to give back. He learned this lesson from his mother, who taught a variety of subjects, including African-American history, at various primary schools and universities (and who once taught Hamilton Jordan in an executive training program, who later recruited her into the Carter campaign as a domestic policy adviser). “I remember going with her on the picket lines to protest the John Birch Society meetings that were being held at the Pasadena Civic Auditorium,” he says. “She emphasized the importance of taking a position.”

He took an important one after Stanford by deciding to pursue a career as a criminal lawyer. He had been disturbed by the disparity of incarceration rates he noticed among African Americans—“just the pure numbers made no sense to me”—and wanted to do something about it. So he applied to Harvard Law School and, being a total brainiac, got in. Midway through his first year he had an epiphany.

“Two things occurred to me. One was justice costs money. Even though I was an economics major, I had not put together the direct connection between [a defendant’s] wealth and the criminal justice system [the quality of the defense they receive]. I saw it pretty clearly in the things I was studying. Second, I wanted to take a road less traveled. There were numbers of significant African-American criminal attorneys who had already proved their ability to perform well in that area. But I saw none on the corporate side. I thought I could make more of a contribution there,” he says.

After graduation, Johnson high-tailed it back to California (“I really liked Harvard but not the weather.”) and put his shoulder to the wheel. He landed a job in the corporate department at Tuttle & Taylor and threw himself into his work, learning the mechanics of deal making, and in his spare time, he would serve in the community, often ending up in black churches. He noticed something there. If a church thrived in a neighborhood, area business often followed. “I saw how churches could play a role in economic development,” he says.

He was then lured into politics by Los Angeles City Councilman Bob Farrell, who offered him a job as a policy adviser. Being his mother’s son, a wonk at heart, he couldn’t resist. “It was a very special time during the politics of the city because we had a young, dynamic African-American mayor in Tom Bradley, and a lot of energy in City Hall,” he says. “I learned so much about navigating the system.”

Two years later, Johnson took his knowledge and decided to dive deeper into neighborhood work. He became president of the Economic Resources Corp., a nonprofit headquartered in Lynwood. “I was asked to engage in economic development in economically deprived areas, and that really suited me,” he says. “Our projects required both commercial financing and government subsidization, so I learned to pull together funding from the federal government, state government, local government and commercial banks.”

He learned well. The job basically entailed selling a vision to multiple partners and asking them to take a leap of faith. When they would, something magical would happen. Buildings came up, straight out of the ground. You’ll still find them in south central Los Angeles.

“Our core business was developing an industrial park that straddled the cities of Lynwood and Compton, and while I was there I doubled it from 30 acres to 56 acres,” he says. “My proudest accomplishment was building the first shopping center in Watts, at the corner of 103rd and Compton Avenue. It’s still there.”

It was work that filled him up and he did it for seven years, but something started to pull on him. He missed the practice of law. He still felt that was where he could have the deepest impact; had to get back to it. So he took a chance and with two partners started a small firm in Pasadena, and basically became a one-man Rose Bowl parade. Turned up everywhere in the community. Boards, charities, school picnics. He even helped start a newspaper. “Oh yeah, Pasadena Weekly, it’s still going, you can pick it up.”

He wrung as much as he could with his time in his hometown but started to think, well, what could he do on a larger stage? What if he looked outside his beloved Pasadena?

Los Angeles beckoned. He took another leap and joined the new office for the national firm Kaye Scholer. And the deals did get bigger. He got in the conference room with all kinds of Fortune 500 business leaders and set up lots of things: cable television networks, restaurants, record labels, studios. He could dig into lots of numbers here.

In 1997 he moved over to Akin Gump and began to make contacts in the music industry. He worked with GospoCentric Records, did some work with Stevie Wonder, or “Steve” as he calls him, and really made his work TLC, for whom he secured a $24 million payday after its members sued to get out of an exploitative record deal. “That was the deal that put me on the map in the music business.”

He was on a lot of maps by then. But not church maps. Not until Ulmer called.

 

Walk into the Forum today and you’ll swear it’s 1999. Nothing’s changed. You won’t find any pews or stained glass; the place hasn’t been turned into a church. “That was never our intention,” Johnson says. What you’ll find are people working, whether it’s to prepare for a Madonna concert, or Pearl Jam, or the Rolling Stones. The Lakers even came back last October for a pre-season game. Oddly, the flock at Faithful Central doesn’t swing through the doors much. They mostly stick to their home base at The Tabernacle, which seats about 2,500 people, down the road. But no matter. The building’s alive. People are employed. That was the intention.

And since Johnson closed that deal in 2000, other churches around the country have taken heed. Lakewood Church in Houston, led by Joel Osteen, for example. Using Johnson’s playbook, in 2003 it spent $75 million to buy and renovate The Summit, the former home of the NBA’s Houston Rockets.

Suddenly, church leaders everywhere are thinking big in terms of where they want to worship and how they want to brand themselves. Johnson hears a lot of ideas. Sometimes it’s his job to wave them off. Not everything can be turned into a silk purse. But sometimes he says sure, go ahead, buy a sports arena. I’ll help you. He loves this space he inhabits, where law, business, faith and opportunity meet. It’s where it’s all come together for him.

“I am so blessed. I just feel like this is what I’ve been called to do.”

Editor's Note: In the printed version of the article we included a sidebar that mentions Channing as a labor and employment lawyer when in fact he does entertainment and sports law. Our apologies.

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