This story first appeared in the Feb. 8 issue of The Hollywood Reporter magazine.

In November, a journalist asked J.J. Abrams what seemed like an obvious question: Was he interested in directing the next Star Wars movie? Disney had just paid a whopping $4.05 billion to acquire George Lucas' iconic Lucasfilm and had stated its intention to turn out new Star Wars films every two to three years beginning in 2015. The prolific Abrams, who had sparked the flagging Star Trek series in 2009, seemed a natural fit. But he quickly shot the idea down. While Star Wars was "the first movie that blew my mind in that way," he said then, he wanted to focus on original material.

Kathleen Kennedy, the 59-year-old producer who in June had been placed atop the Lucas empire, was not so easily deterred. The Lucasfilm job was just the latest beat in a remarkable 35-year career replete with hits from filmmakers as diverse as Clint Eastwood (The Bridges of Madison County), Robert Zemeckis (Back to the Future), David Fincher (The Curious Case of Benjamin Button) and, above all, Steven Spielberg — from 1982's E.T. The Extra Terrestrial to his current Oscar contender, Lincoln.

Kennedy already had called Beth Swofford, Abrams' CAA agent, and been told Abrams was too deeply engaged in the next Star Trek movie and other obligations at Paramount — not to mention innumerable television projects — to consider the job. Nonetheless, Abrams agreed to meet with Kennedy on Dec. 14 at his Bad Robot offices in Santa Monica. Famously plain-spoken, she summarizes her pitch like this: "Please do Star Wars." And she had cards to play. Not only was Oscar winner Michael Arndt (Little Miss Sunshine, Toy Story 3) writing the script, but Lawrence Kasdan, who wrote 1980's The Empire Strikes Back and 1983's Return of the Jedi, was on board to consult. Abrams "was flipping out when he found out that Michael and Larry were on the movie already," says Kennedy.

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Abrams tells THR, "I learned firsthand how incredible and persuasive she is." Some — but not all — of his reservations were dispelled. "The thing about any pre-existing franchise — I'd sort of done that," he says. "But when I met with Kathy, it was suddenly very tantalizing."

Kennedy, Abrams and the writers met secretly for about three hours Dec. 19, and "J.J. was just on the ceiling when I walked out the door," she recalls. But still, she says, Abrams had "very genuine concerns" about his obligations elsewhere and the impact on his wife and three kids, given the likelihood that the film would not be shot in Los Angeles. And then there was the unique nature of the franchise. "If there was any pause on J.J.'s part, it was the same pause everybody has — including myself — stepping into this," she says. "Which is, it's daunting."

Indeed, the six Star Wars films have grossed more than $4.3 billion at the worldwide box office and spawned an empire that includes TV spinoffs like The Clone Wars, books, theme park rides and, of course, merchandise sales. Disney has said Lucasfilm generated about $215 million in licensing revenue in 2012 without having released a Star Wars-related movie in five years. Managed correctly, Star Wars by far is the most valuable franchise in Hollywood, making Kennedy — its new steward — one of the most powerful figures in entertainment.

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So Kennedy had to do what she does so well: put one of the industry's most prominent directors at ease. And she's known Abrams since he was 14, when Spielberg had read an article about him winning a Super 8 moviemaking contest and hired the future director to restore his own childhood Super 8 videos. "We spent a lot of time talking about how meaningful Star Wars is and the depth of the mythology that George has created and how we carry that into the next chapter," she says. Finally, after a day of furious negotiation, the deal closed the afternoon of Jan. 25. To the bitter end, Abrams was telling associates that he still wasn't fully committed to directing the project. But Kennedy is confident that he will be in the chair when the cameras roll. She is less clear that the first film in the new trilogy will be ready by 2015. "Our goal is to move as quickly as we can, and we'll see what happens," says Kennedy. "The timetable we care about is getting the story."

Sitting atop Lucasfilm as the founder's handpicked successor, Kennedy clearly has the clout to make her voice heard loud and clear. Kennedy, married since 1987 to producer Frank Marshall and the mother of two teenage daughters, reports to Disney Studios chairman Alan Horn, though the importance of her domain ensures that she also has the ear of Disney chairman and CEO Robert Iger. She has great ambitions to restore the 1,500-employee, San Francisco-based Lucasfilm to "a full-fledged production company" making "as many good films as we can." That's in addition to managing its successful Industrial Light & Magic effects division and LucasArts gaming branch. But the main order of business must be getting the first movie right.


Even as Kennedy was laboring frantically to make the Abrams deal and put her stamp on Lucasfilm, she has been in the midst of a grinding awards campaign. Lincoln — the last film she will produce for Spielberg for the foreseeable future — has defied expectations by grossing more than $180 million worldwide (and counting) while picking up a dozen Oscar nominations, matching Spielberg's record with Schindler's List in 1994. Lincoln marks the eighth time that one of Kennedy's films has been nominated for best picture. Shockingly, given her career, she has yet to win.

"I'd love to have the Oscar," she laughs. "I'd love to get this over with. It's not fun to lose. I admit that." She has sat at the Golden Globes, the Producers Guild Awards and the Screen Actors Guild Awards, only to watch Ben Affleck and the Argo team stride to the stage. While she tries to assure others on the Lincoln crew that life will go on, she also is glad that she has a demanding new job. "I would hate to be in a situation where my entire focus was obsessing around the issue of whether we're going to win best picture," she says.

Even before taking the reins of Lucasfilm, Kennedy was one of the most accomplished women in the industry. But she has flown a bit below the radar, perhaps because of the shadow of the enormously powerful men with whom she has worked. She hasn't sat for many interviews over the years. "I'm not great at talking about myself," she says, dressed simply in a black jacket and cream blouse. "I don't analyze things all the time, I just do them."

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No doubt one of the keys to Kennedy's success is that she is the opposite of a preener. Even her expansive, contemporary-style office at the Kennedy/Marshall Co. in Santa Monica, from which she will be largely absent for at least the next five years (the length of her Lucasfilm deal), is decorated in muted, neutral shades. She displays mementos that trace a career: a Seabiscuit bobblehead that plays a broadcast of one of the champion's races; a framed, autographed playing-card-size photograph of Abraham Lincoln that was a gift from Spielberg; a toy Snowy, the terrier from The Adventures of Tintin, the 2011 movie she produced for Spielberg and Peter Jackson; and hefty, meticulously rendered Star Wars collectible figurines. There also is a series of photographs of her daughters.

Spending time with them is a priority for Kennedy. Despite the demands of work, she says she and Marshall, who have homes in Los Angeles and Telluride, Colo., manage to have an active social life — including many friends outside the industry. "I have a very fun husband," she says. "He's managed to hang on to every person he's known since grammar school."

In her new position, she will split her time between the Lucasfilm offices at Disney and the company's headquarters in the Presidio of San Francisco. Usually Kennedy flies to the Bay Area on a Tuesday and returns to Los Angeles on a Thursday evening — a schedule she says allows her to spend more time with her family than she could during long film shoots. On the heels of War Horse, which had her living in England for three months, Kennedy spent another three months away from home in Richmond, Va., for Lincoln.

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Of all the films they've made together, says Spielberg, "We probably have never worked more closely as a team than we did on Lincoln. … She was there for casting, readings with actors. Every single aspect of mounting this film in Richmond was under Kathy's purview."

Kennedy agrees that making Lincoln was especially profound for Spielberg and her. "This is a movie that we all deeply, deeply cared about," she says of the years-in-the-making project. "Those are the most enriching, lasting experiences. It really represents an important part of your life, creatively."

Those who have watched Spielberg and Kennedy at work say the connection is apparent. "It's so efficient, it boggles the mind," says screenwriter David Koepp (Jurassic Park). "They're able to accomplish in a day what mere filmmaking mortals do in a few — and they don't seem to finish a lot of sentences." Kennedy, he adds, is "great at correcting him and being straight with him. … Finding someone whom you trust and know will be honest with you is difficult for most directors and super-difficult for someone of Steven's stature. That has to feel irreplaceable."

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DreamWorks CEO Stacey Snider says she experienced Kennedy's competence back in 2000, when, as chairman of Universal, she was weeks away from the start of filming on Jurassic Park 3, with $18 million already spent: "I was in New York, and my phone rang, and as my foot stepped into the crosswalk, Kath said: 'Steven and [director Joe Johnston] aren't happy with the script. We're going to pull the plug.' And by the time I got to the other side of this wide boulevard, she had told me what the plan was, how the $18 million would be rendered productive, how they would fix the script and restart the movie. It was from one curb to the other — something horrible happened, and there was a solution."

Given that, it's hardly surprising that Spielberg seems to feel some sense of grievance that his old friend Lucas has taken Kennedy away. Lucas called to raise the issue during a dubbing session on Lincoln. "He actually asked for her hand in business," says Spielberg. "I wasn't going to stand in her way."


Kennedy was not one of those unhappy kids who found escape at the movies. She recalls a very normal childhood in the small Northern California towns of Weaverville, where the local theater showed movies just once a month, and Redding. Her mother was a homemaker; her father was a lawyer, then a Superior Court judge. There were three girls: Kathy, as she's still known, her twin and another younger sister.

When Kennedy started college at San Diego State University, her plan was to become a nurse. That was scrapped after she volunteered at a local TV station during the 1972 election and instantly was hired part time as a camera operator on a show called Dialing for Dollars. Kennedy switched majors to film and telecommunications and started doing various jobs on a mixed bag of programming, from local news to football games to rock concerts.

In 1977, Kennedy saw Spielberg's Close Encounters of the Third Kind and decided she wanted to work in the movie business. ("I know that sounds made up, but it's true," she says.) Her college roommate, actress Mary Ellen Trainor (Roswell), told her that filmmaker John Milius was looking for a production assistant. Trainor knew that because her boyfriend at the time, a young Robert Zemeckis, was co-writer of a period comedy with Dan Aykroyd and John Belushi that Milius was executive producing. The film was 1941 — Spielberg's follow-up to Close Encounters.

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Kennedy's first task was cataloging Milius' gun collection. "I consequently know the difference between a Colt .45 and a Colt .45 Gold Cup," she says. "I know what a Winchester Over Under is. Things that I have no desire to know, I know because of John Milius." Milius is one of Hollywood's larger-than-life characters, and Kennedy acknowledges, "There was a fair amount of insane things going on. I tried to ignore the things that I didn't find particularly appropriate and carried on," she says. "I did have thoughts every now and then of, 'Is this really what I want to do?' But I knew I wanted to make movies, and I knew it was somewhat of a means to an end."

Indeed, the end was near. "Kathy was working for John Milius, and yet she kept hanging around my area of the office," recalls Spielberg. At one point, he asked her to organize some notes. "I stayed up all night long putting these little booklets together," says Kennedy. "And he seemed incredibly impressed. I thought that's what was expected." Spielberg soon swiped her to be his secretary/assistant. "And the first script he put down in front of me was Raiders of the Lost Ark," she says. "Nice way to start."

Kennedy had met Spielberg at a pivotal moment. Having made 1975's Jaws, which was a seminal hit, he had gone over budget on Close Encounters. Then came a humbling experience with 1941, which underperformed. "Steven and I talk about this," says Kennedy. "It was a real turning point when he started to recognize that he was going to have to carry some of the responsibility from a producorial standpoint into his directing. I think he actually acknowledged for himself that he didn't do his best work when there were no boundaries." So while Kennedy's job was always to keep projects on budget, she had a more than willing partner.

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Raiders was an enormous turning point for the industry and for Kennedy. In 1980, thanks to Lucas' clout coming off the first two Star Wars movies, Paramount agreed to what many in Hollywood considered an outrageous deal for the project, yielding considerable control and a hefty share of first-dollar gross to the filmmakers. Sid Sheinberg, then running Universal, declared that the Raiders precedent would "destroy this business." And in fact, it marked a dramatic shift in power and profit to talent that has only begun to subside in recent years.

As work on Raiders began, Spielberg told Kennedy to get in touch with producerMarshall, who was working in Lucas' nearby offices in Universal City. "I kept calling him Mr. Marshall," says Kennedy of her future husband, then 33 and seven years her senior. "And he finally said, 'Could you please stop calling me Mr. Marshall?' He said, "I'm going to come over and meet.' So I'm looking out the window, and this little teal blue Porsche drives up, and this really cute guy in a cable-knit sweater jumps out, and I'm like, 'Well, hell-o, Mr. Marshall!' "

Says Marshall: "I knew that the best way to know what my director was doing was to become friends with his assistant. She was very cute and very efficient and energetic about making movies. I had never thought I'd find someone who liked to make movies as much as I did. But I was completely respectful. There was no way I was going to screw this up by hitting on Steven's assistant." Still, he says, "good relationships are, a lot of times, built when you're friends first. And that's kind of what happened with us."

Even in those days, Spielberg had come to rely on Kennedy so much that he admits he would not have been happy to learn she had begun to date Marshall — which she had, secretly. "I wanted Kathy to be working with me as my assistant and Frank to be producing the movie, and never the twain shall meet," he says. "But you can't stop love."

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With Raiders under way, Spielberg offered Kennedy the chance to produce his next movie. (At the same time, he had come up with the idea for Poltergeist and hired Marshall to produce.) Kennedy might seem unflappable now, but as a 26-year-old producing her first film, she threw up every weekend — remarkably confining her anxiety to her days off. That first movie turned out to be E.T., and Kennedy's stomach soon settled. She had been promised $50,000 to produce the tale of a boy and his alien friend, but when it grossed more than $350 million (more than double the next-highest-grossing movie of 1982, Tootsie), she got a windfall of $700,000 instead. She called her grandfather, who counseled her to buy bonds.

With the success of E.T. and Poltergeist, Spielberg, Kennedy and Marshall concluded that the team could produce more than one film at a time. In 1983, they formed Amblin Entertainment, and an enormously prolific period ensued. Spielberg had found partners who were as dedicated as he could have wished. "When we built Amblin, we even put Murphy beds in there because we thought that was so practical," says Kennedy. "Why would anybody, if you were working on something, need to go home at night? You'd just stay there, wake up in the morning and carry on."

Amblin produced not only Spielberg's films but an array of hits from storied directors, including Zemeckis' Back to the Future trilogy and Who Framed Roger Rabbit, Richard Donner's The Goonies and Martin Scorsese's Cape Fear. Kennedy primarily focused on development and took the lead on movies that Spielberg directed, including The Color Purple, Empire of the Sun and Jurassic Park.

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But in the early '90s, Spielberg's fears of abandonment were realized. Marshall wanted to direct and started his own production company. For a time, Kennedy remained at Amblin, working on projects and developing Schindler's List, but she soon joined her husband, forming Kennedy/Marshall. Spielberg, who calls it "a very amicable parting of the ways," turned to another married couple, Walter Parkes and Laurie MacDonald, to run his company. By the time filming began on Schindler's List — Spielberg's only film as director to win the best picture Oscar — Kennedy was gone.

"Leaving Steven was the hardest thing Frank and I ever did, but it was done only because we had personal things that we wanted to do together," says Kennedy. For instance, they wanted to start a family. "I was 50 when we had [our first child]," says Marshall. (Kennedy was 42.) "We almost waited too long."

Kennedy/Marshall had success with The Sixth Sense and Seabiscuit, though the pace eventually flagged as the industry began to contract. But by then, Kennedy already had circled back to working with Spielberg, starting with his 2001 film, A.I. Artificial Intelligence. "In a strange way, I never really left," she says. "We were always continuing to talk about movies." She was passionate about the unfinished Stanley Kubrick project, and Marshall says, "As long as she got to work with Steven, she was very happy."


Kennedy not only is a superbly competent producer, but she has been an exemplary citizen of Hollywood. As co-president of the Producers Guild of America from 2001 to 2002, she took on the thorny question of which producers actually are entitled to credits, saving the industry from the spectacle of Harvey Weinstein-led herds stampeding the stage at awards ceremonies.

Among her most remarkable achievements is the fact that Kennedy has managed to remain grounded and widely liked. She not only receives praise from giants like Eastwood, who calls her "a terrific filmmaker," but far smaller players as well. Marjane Satrapi, the Iran-born creator of the graphic novel Persepolis, met Kennedy when she became a producer of the 2007 animated version of Satrapi's book. The author remembers Kennedy drinking cheap wine out of a plastic cup at a party during production in Paris. "Our studio of animation was no Disney or Pixar," says Satrapi. "And she was telling me, 'This is one of the greatest places I've ever been.' She can really enjoy things as if she was 21."

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Not to say that Kennedy is too nice to crack the whip, even with A-list talent. Tony Kushner, who wrote the screenplays for Munich and Lincoln, says Kennedy is "reasonable and funny and smart" but also can be blunt. "I got really upset on the set of Lincoln about something that was kind of minor, but I overreacted," says Kushner. "She said: 'Come on! Stop it!' She sort of barked at me. It was very effective." Koepp reports a similar experience. "The two times I got into an argument with her, she completely trounced me," he says. "In fact, I was convinced I was the problem."

But when the going gets tough, Kennedy tends to side with the filmmaker. Perhaps the most unusual homage to Kennedy comes from Fincher, who went through some battles with Warner Bros. and Paramount during the making of Benjamin Button. Asked to describe his working relationship with Kennedy, he writes in an e-mail to THR:

"Kathy Kennedy is a DIRECTORS producer … She is never interested in the 'Lay of the land' … Studio politics are a tangential distraction. She is all about the importance of DECISIVE MOMENTUM.

"When you, as a director — call Kathy and say 'I need this …' she can actually remember the meeting where you explained why something was LINCHPIN to an effect you were trying to create — or helped support an idea that you felt was essential to the story you are telling, and SHE CAN ACT ON IT.

"If 'Coffee is for Closers' … Kathy is WELL CAFFEINATED."

Kennedy says she is fully cognizant of the significance of Lucas' decision to entrust his legacy to her. Star Wars "defined his life creatively in a way that he never anticipated," she says. "It's something I think about all the time. It took a lot for him to step away. And the fact that he turned it over to me — I think, 'Oh my God, I have a huge responsibility to him.' He did say, 'You just do what you do.' I said, 'OK. I'll figure out what that is.' "

Lucas still will be in the picture, but his role is expected to be limited as Kennedy begins to exploit the Lucasfilm assets. "I call him my Yoda," says Kennedy. "He'll be a consultant. But he recognizes he's stepping away."

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Asked whether he believes Lucas can really keep his distance, Spielberg doesn't hesitate. "I completely know he can do that," he says. "He's ready to start living without the burden and weight and responsibility of this huge corporate asset."

Kennedy now reports to Disney's Horn, with whom she acknowledges some tension during the making of Benjamin Button, when Horn was president of co-financier Warners. "We went through kind of a bumpy road," she admits. "But he's an adult."

Says Horn: "A movie of that size and scale is always challenging. She puts herself on the side of what she thinks will be in the best interest of the project artistically. Any studio has an obligation to find that elusive balance between art and commerce. We found it." Now they must find it going forward on Star Wars.

But first comes the Oscars. Perhaps Kennedy will not end with the win that would have wrapped up this chapter of her career with a bow. But she and Spielberg say their parting is not permanent. One project that could reunite them would be a fifth Indiana Jones, but Spielberg is clear: "I will not make another Indiana Jones film unless it's based on George's story." Lucas intends for that to happen, says Spielberg, though the timetable is unclear — the gap between the previous two movies was 19 years. "Kathy and I will figure out some way to work together again," he says, before adding, as if counting the days, "She has a five-year contract."