"Caligula" is a study in the application of power, how absolute power corrupts absolute power corrupts absolutely. -- Penthouse magazine owner Bob Guccione

FROM A yard-wide copy of an ancient Roman coin, the face of the emperor Caligula glares down at a 35-foot-long indoor swiming pool, tiled in small sterling silver squares that descend to a depth of six feet. Underwater light from the rippling pool mingles with rays from a chandelier, and sets gold and silver shadows dancing on the coliseum-style brick walls of this $5-million, seven-story town house.

Upstairs, in his third-floor bedroom, the lord of the manor--a monument more appropriate to Rome than midtown Manhattan--is juggling two telephone calls: one with film types in London working on plans for his second X-rated epic, "Catherine the Great"; the other with lawyers in California defending his empire in a $640-million libel suit brought by the Rancho La Costa--a California resort which, Penthouse alleged, had ties to organized crime.

At 50, Robert Charles Joseph Edward Sabatini Guccione is tall and imposing, with deep-set brown eyes, a strong nose and chin, powerful hands and a sonorous voice that echoes a serious Rodney Dangerfield. He wears ostentatious displays of wealth--out of synch with the classic style of his home, badges diluted by suggestions of Hollywood and Las Vegas: an inch-wide gold braclet on the right wrist; a gold watch on the left; around the neck four gold chains, bearing symbols of his realm--a small set of male genitals, the Penthouse trademark of a key, and aSagittarius sign--all cast in gold, all framed in an opened chamois shirt, tucked into olive leather pants, in turn tucked into brown and red Venetian leather boots. A Romanesque presence painted with rouge.

Downstairs, a bell rings. Three enormous Rhodesian ridgebacks leap to their feet and bark.

A portly guard, in sport coat and tie, opens the mammoth double doors to East 67th Street. A crew of movers appears, gently easing across the hand-cut Carrara marble floor the first of two ornate, 7-foot-high, gold-leafed candelabra.

Guard, with a tone of mirth: "Where's the coffin? Isn't this what goes on either end of a coffin when you go in a funeral parlor?"

Laughter. The newly acquired objects are placed on both sides of the pool, opposite a pair of lead Neapolitan sphinxes.

Guccione was working until 8:30 in the morning with Jane Homlish, his 31-year-old personal and pictorial assistant, pouring over 1,000 35mm slides of a woman in various degrees of dress and arousal. They were trying to put to bed a 16-page centerfold spread for the June issue of Penthouse. But the deadline had already passed, and Guccione was fighting expensive overtime charges that have plagued him repeatedly since he fired editor Jim Goode last summer and resumed direction of the magazine himself. He slept for an hour and a half and now, at 2 p.m., is already two hours behind schedule.

Time and money seem of little concern to this man who has worked long hours and spent lavishly in the past two decades, all the while creating a private empire that financial analysts say is worth anywhere between $10 million and $200 million, virtually all of it earned in the skin trade: magazines (Penthouse, Forum, Variations, the now-defunct Viva, and the science monthly Omni); movies ("Caligula"); mail-order sex aids (Evelyn Rainbird Ltd.).

But now his realm seems under siege: Penthouse is off 10 percent in circulation, down to 4.1 million copies a month; Guccione has tied up much of his personal fortune in an unfinished Atlantic City casino; and, in the course of his conquests, this latter-day empire builder has evolved into a rather litigious personality, spending millions annually on about a dozen legal matters that range from an outstanding warrant for his arrest on pornography charges in Fulton County, Ga., to the $640-million La Costa suit.

Thirteen months ago a jury in Cheyenne awarded Kimerli Pring, a former Miss Wyoming, $26.5 million in a libel judgment against Penthouse for printing a racy story about a fictional Miss Wyoming who could levitate men with her sexual prowess. "If that stands in the lower court," Guccione says, "the Supreme Court will have to take a look at the First Amendment."

At the same time, the magazine was hit with a $10 million suit by the Rev. Jerry Falwell, who claimed that an interview with him had been obtained by reporters who concealed that they were working for a "pornographic publication." That suit was dismissed.

Another suit was brought by Isabella Lanza, the 1980 Pet of the Year, who had a change of heart and, from the podium at a dinner in her honor, denounced the magazine for expoliting women. Lanza asked a court to award her the profits from the issue of the magazine that revealed her to the world. That matter is still pending on appeal, as is a judgment awarded Playboy over misrepresentations of its circulation figures in Penthouse ads.

In turn, Guccione has filed his own suits against fellow sexploiteer Larry Flynt, for running in Hustler magazine a cartoon of Guccione sodomizing another man, and Eastman Kodak, for refusing to return to him photographs the firm considered pornographic. There is also a pending case against the magazine's Canadian distributor.

All these issues seem to drag on and on--and not just for Guccione. Recently the California Superior Court judge in the La Costa proceedings complained from the bench that the 4-month trial was weeks behind schedule. "The trouble with this case is that there are 16 lawyers and only one judge," Kenneth Gale observed. Guccione says he already has spent $4.5 million on the La Costa litigation alone, and that his team of lawyers is waiting to introduce "sensational evidence," which he declines to describe further.

"If we lose this case," he says, "no newspaper would be able to report on organized crime. You couldn't do investigative journalism. You couldn't speculate at all."

Guccione also has filed a $20 million suit against The Record, a New Jersey newspaper that linked him to organized crime figures in his quest to expand the Penthouse empire into the Atlantic City casino world. "Ridiculous," he says, "something they only do because my last name ends in a vowel."

In Atlantic City, 140 miles to the south of The House, as this ersatz villa is called, stands the most visible weakness in Bob Guccione's empire: a sprawling 40-percent-completed casino complex that includes what used to be the Holiday Inn, the Four Seasons and the Mayflower hotels--now gutted and lifeless. Guccione figures that his $60-million gaming-house gamble is costing him $40,000 a day in interest the money already spent could otherwise be earning; he needs to raise another $100 million to finish building and outfitting the casino and hotel.

"An investment that size could threaten any organization," he says. "I never realized how difficult it would be to raise that kind of money."

It "could well be his downfall," says Mark Meagher, who spent part of last year as Guccione's chief financial adviser, calling his boss when he signed on "the most creative, exciting person I've ever delt with." Meagher left after nine months at Penthouse to start his own investment firm because Guccione "couldn't leave me alone and let me do what I had to do to put the company in financial order. He's prone to huge overinvestment. He can't say no to anybody. That's part of his problem."

There is a mythic quality about this man who left an exclusive New Jersey boy's academy to wander about Europe as an artist, started a magazine that surpassed Playboy in profits, amassed an enormous personal fortune, hired and fired and rehired employes with the insouciance of a despot, and assembled a house--filled with the treasures of kings--from which he now rarely ventures forth. It is as if he slew the keepers of the temple gates, proclaimed himself master, and now finds the furies conspiring to topple the walls about him.

Beyond these classical allusions, Guccione himself invites more contemporary comparisons to the acquisitive William Randolph Hearst, who nearly impoverished his own publishing empire to build San Simeon in the hills of California, and Hugh Hefner, who created from the pictorial titillation of Playboy an empire replete with two mansions.

Guccione: "Hearst had more acreage. You ever seen San Simeon? It's ugly. This is . . . beautiful, classical, tasteful."

He adds that he's never been there.

Art Cooper, a former editor of Penthouse: "He has a paranoid view of the world. Everyone is out to get him, and he has to prove that he is the master. He's not unlike Hearst in that regard. He once told me he wouldn't mind starting a little war."

Guccione: "Heffner has fooled around with so many of his girls. I've never slept with any of the models I photographed. You could say I'm a prude. I was raised in an Italian family where I was taught to revere women."

Gore Vidal, who wrote the screenplay for Guccione's $17.5 million hard-core feature film "Caligula," and then demanded that his name be struck from the credits after the two disagreed over the way it was directed: "You want me to talk about him? I'm a senatorial candidate and we only spread wisdom and light. Okay. More like Caligula's mother than Caligula--dyed locks and heavy makeup."

Back downstairs, the three Rhodesian ridgebacks run around frenetically, cavorting with bones, even as maids efficiently polish ashtrays, workmen scurry about, and secretaries shuffle out doors and in others, often carrying wine glasses filled with Tab or tomato juice, or cups of frothy cappucino. In static contrast, on pristine white walls, centuries-old barbarians and pagans peer from the patinas of Renaisance paintings.

A Polish-born photographer who has been published in Penthouse, Gaeda--just Gaeda--has been waiting to see Bob Guccione for two hours. He is sitting in one of two plush, brown-upholstered chairs in a reception area that can be converted into a screening room by swiveling four carved woodenpanels to reveal a large projection screen. He has been drinking a Tab from a wine glass, and reading a copy of Omni, the science magazine with a circulation of 780,000 that Guccione started in 1978. On an antique wooden coffee table in front of Gaeda rests a small globe, surrounded by a Plexiglas representation of the celestial sphere and depictions of some of the 88 named constellations.

At 2 p.m. Gaeda is summoned up the plushly carpeted marble steps--past the Degas and Renoirs and the gold Steinway piano that was owned by Judy Garland (sheet music to "Silent Night" sits on its music stand)--to Guccione's office, a dark room about 18 feet square, filled with books, framed in $150,000 worth of English paneling from a Georgian mansion, and dominated by a large chandelier with red bulbs. A picture of Guccione's parents--both in their mid-70s--sits on a desk beside a white telephone and a stuffed koala bear sent by the publishers of Penthouse in Australia, where the magazine sells better than any other skin journal.

Guccione: "Well, as you know, we're going into cable. We're going to try to translate as much of the magazine as we can into film. Have you got anything on tape?"

Gaeda: "I have something very erotic. But I would like to try something new. I was thinking of four groups of pictorials and then one hour of film."

Guccione: "Show me a sample of what you've done to date. This way we can devise a method of working. I know what your still photography is like. I just want to see how you handle the film camera, even if it's not erotic. Just produce some talent for us. We need a lot of good stuff--European-oriented, done tastefully. It's got to be first-class, good photography."

Gaeda: "Do you have a budget in mind?" Guccione: "I can't say what budget would be acceptable. You should build a fee and a profit into your budget. For a centerfold, we pay $6,000; for a second pictorial $4,000; expenses on top about $3,000. The girl is about $6,000. The whole package with the girl is about $16,000; she gets to draw $200 a week in the year she's in. The girl has got to be new. She must be new. If she doesn't do any further nude modeling, she's eligible for Pet of the Year. That depends on how she's articulated physically, the expressions on her face . . ."

Gaeda: "You will have a budget and a sample film by the end of this week, beginning of next."

He exits after 12 minutes.

When Bob Guccione graduated in 1948 from Blair Academy in Blairstown, N.J., he hardly dreamed of building an empire. He married at age 18, moved to Rome, and began a life as a painter--supported by his father Anthony, the treasurer in a neon lighting firm owned by his wife's brother. Over the next decade and a half Guccione wandered around Europe. He read palms. He sired a child. He got divorced. He sketched caricatures in cafes. He married again, had four more children. ("He's wonderful, very affectionate with his children," says Meagher.) He left his second wife and, in London, worked for a small newspaper and then managed a dry cleaning shop. He also met Kathy Keeton, a South African with whom he still lives and never married.

Guccione: "I guess you could say I'm not a good Catholic boy."

"Penthouse was in many ways accidental," he says. "I didn't think I was employable. From 1948 to 1965 I never had a real job. I had no career interest. That's the kind of guy who an employer knows he's going to dismiss somewhere down the line. Then one day I noticed that Playboy was the only men's magazine in England."


He took nude photographs for a promotional brochure that he says was accidently mailed to enough members of Parliment and the clergy to create a minor scandal. He had no money and may not have been a businessman, but he was savvy enough to give the check to the brochure's printer after the banks had closed on Friday; on Monday he rushed to the Post Office, collected his subscription payments, and deposited them before the printer's check had cleared.

The first issue of Penthouse, with a printing of 120,000 copies, sold out: to counter Playboy's airbrushed girls, Guccione offered pubic hair. The empire found its roots, and expanded rapidly into the mail-order sex-aid business. Guccione started Forum, a digest of sexual practices. In 1969, he carried the kingdom to America, where it flourished. Viva, an erotic magazine for women edited by Keeton, was a failure. Guccione blames this on newsstand dealers who refused to rack the magazine with other womens' books like Vogue, Cosmo, and Glamour; instead, they piled Viva up with Playboy, Oui and Penthouse. He is so certain of this, and so certain that the magazine was viable, that he now declares, "I'm going to relaunch it soon." Guccione also started foreign editions of Penthouse in Germany and Italy. He still owns 99 percent of all these endeavors; his father, the corporation's treasurer, owns the other solitary percent.

He belies the public picture of the pornographer, projecting instead an image of a man caught up in the throes of business. If there were more time in the day, he says he would spend it in his work. One of his fantasies is to buy an entire city block, and provide neighboring homes for his friends and relatives. That way, he says, it would take less time to see people, less time away from the business.

Certainly he has been successful by some standards: the Audit Bureau of Circulation, which monitors magazine revenues, confirms that more money is spent each month on newsstand purchases of Penthouse than on any other magazine. Guccione emphasizes that the main thrust of the monthly is investigative journalism, although his personal obsession seems to be the design of the nude pictorials. "They are tasteful," he says, "like this house." The photographs in the magazine might be a point of debate; the house less so. It does emanate a sense of style and class, even refinement. Picasso's "Boy With White Collar," purchased at auction for over $1 million, simply hangs on a wall among other canvases by Matisse, Van Gogh, Chagall. Nothing focuses particular attention on this jewel; it is part of a panoply of classical art.

Guccione is aware of the timelessness of these pictorial investments. He seems like a man seeking immortality. He acknowledges that some staffers at the magazine think he cannot tolerate the questioning of his opinions; that he acts omnipotently and as a result, they say, the magazine has become mired in a repressive case of the emperor's new clothes, which has stifled innovation and caused the decline in circulation. Guccione thinks the staff misreads him: He says he encourages creativity and independence, and blames the sales drop on a general softening in the economy.

He does, however, have a very real fascination with the stuff of eternal life. Guccione commissioned a nine-part series on cancer which one associate describes as "his personal research investment in a disease he fears will cut his life short. If someone walked into Bob's office, and told him that for $75,000 he could have the elixer of immortality, he'd hand the guy the cash--along with a proviso that not just anybody be allowed access to the formula." Guccione says he has invested $40 million of his own funds in genetic engineering research and experiments on nuclear fusion.

On a recent March afternoon, Guccione is making a rare journey out from The House. "I guess you could say I'm a recluse," he says. "This is really the first house Kathy and I have had. I have everything here that I want. So why go out? I don't like parties. I don't like restaurants." And then with absolute seriousness, in the midst of this $5 million treasure trove, he points through a set of glass doors to a tiny yard and says, "I saw this place and I thought, What a wonderful place to grow tomatoes and basil."

Guccione is bound for a recording studio on 45th Street, where he will tape two-minute radio spots to promote the April issue of Omni. "I wrote them myself," he says, "so it's easier to do them myself. And if I do them, we don't have to worry about residuals and rights and agents."

He walks through the double doors with a bodyguard, Carmine Delgado--Del to his friends--a retired New York City cop who quips that Guccione merely keeps him on the staff "to chop the basil when he makes pesto sauce." A driver pulls a just-purchased Cadillac limousine--silver, beige interior, license plates PH MAG--up to the curb and the emperor climbs in, with Homlish. He asks her for a can of Tab, which he seems never to be without, just as Hefner is rarely without his bottle of Pepsi. Homlish pulls a can from her bag, polishes the top with a tissue and hands it to Guccione.

"Who ordered this car," he asks in a tone of muted disgust. To the driver: "Did you? Did I?" Pointing to the beige trim and carpeting: "This is drab. Change it. Get another car."

In sound studio B, at Magno Empire, Guccione spends over two hours recording four promotional spots. "Do you hear this stuff," he asks the engineer, and jangles the chains around his neck. "No? Okay." He complains about the heat in the tiny recording booth. He walks out to listen to a playback of a take he's just recorded, reading the typewritten script through a thick pair of glasses.

Fluttering squeaks of rewinding tape:

"To what extent can the proper use of vitamins and minerals realistically improve our health, prolong our lives and enhance our intellectual capabilities? Dr. Michael Colgan, a research scientist at Rockefeller University, claims that a highly individualized vitamin and mineral program tailored to a specific biochemical profile will enhance mental and physical performance whilst fighting pain, disease and the ravages of time.

"This month Omni, the multi-award-winning science magazine of the future . . . also examines fully authenticated reports of the discovery of a strange, human-like face on the surface of Mars that can neither be denied nor explained and how superstar Robert Redford manages to get high . . . safely."

The tape stops. "That was acceptable," says Vivian Moss, Guccione's media consultant. He says he'll try it again, for an 18th take.

"Don't ever say acceptable to him," says Delgado. "It's got to be good. No, it's got to be excellent."

Back at The House, Leeann Lee is waiting for the emperor. She is 19 years old, from Toronto, Canada, where she lives with her divorced mother. She works as a waitress and part-time model, which she has been doing off and on for five years. She quit school two years ago halfway through grade 12. A few months ago a photographer convinced her to pose for a few nude shots. Leeann mailed them to Bob Guccione at Penthouse, and he liked what he saw. So he flew her down to New York for a photography session--something he rarely does.

She had been to the city once before, with her mother and her mother's boyfriend. They stayed at a Times Square hotel that was full of students on class trips. This time Leeann is staying at The House. She spent part of the morning under Guccione's tanning machine.

And now, at 7:30 p.m., she has been sitting in the living room for an hour. Her back is to a huge stone fireplace. Her red hair is pinned up. She is tall and quite voluptuous. She is wearing a frilly, salmon-colored blouse, black slacks, black leg-warmers, black patent-leather high-heel pumps. All of these clothes, along with her nailpolish and facial make-up, appear to have been bought at a five and dime. She is drinking a glass of white wine and smoking filter cigarettes taken from a cylinder that sits on a glass coffee table the size of a twin bed. The table also holds several ceramic tortoises--the symbol Guccione chose for a magazine going after the Playboy bunny.

The emperor walks in and introduces himself:

Lee: "I never expected you to be wearing leather pants. When I found out that I was going to be coming down here, it kind of made me nervous at first. I started looking at the centerfolds. I really like them . . . They told me to bring some lingerie. But I didn't have any."

Guccione: "We'll get you some."

Lee: "This is going to be my first time really doing nudes. She raises two fingers of each hand to indicate quotation marks when she says, "doing nudes." What kind of props do you have?

Guccione: "Whatever will make you comfortable."

Lee: "I'm staying in the same room with Sheila. In her centerfold she looks real English. In real life she looks like Jody Foster. I came here once for three days. I went to see 'Dancin' ' I love interpretive dances that tell stories, like ones with guys in gangster hats. I went around to a few modeling agencies."

Guccione: "I've got more models than I can handle."

Lee: "My mother is happy for me. I'm sure it was something she would have loved to do, but in her time it was unheard of. I like the idea of being photographed nude. This way you're appreciated for more than the clothes on your back."

Guccione: "You're more than a hanger. Photographers have a very metaphysical thing going on in their heads."

Lee: "I wouldn't do a quickie nude shoot for the guy who made the other pictures before I came down here."

Guccione: "That was good. It keeps you exclusive for us. He gets up to have his portrait taken by a photographer. Watch how I do it. It's easy."

Lee: "You don't have your clothes off."

Guccione: "It's easier with your clothes off."

Down a few steps, through an arch . . . the dining room is dominated by a massive marble table at which Guccione often holds Penthouse editorial meetings. These events are not loved by the staff, largely because they tend to start late and often run well into the early hours of the morning.

A recent meeting dragged long beyond dinner time, and a soporific editor was suddenly revived by the smell of grilled steaks wafting in from the kitchen. How considerate, the editor thought, he's having dinner cooked for all of us.

A butler emerged with three seared slabs of meat on a silver platter. He placed one steak in each of three large dog's dishes, and then returned to the kitchen.

The ridgebacks ate well.