And, sources charged, despite Brokaw'sdemonstrated inability to run the firm profitablyand his failure to control rising costs, Aeneasofficials failed to respond adequately. Thesituation at Avenue was spinning out of control,the source said, and neither Sperling nor Eisensonstepped in to do anything about it.

"There were actions taken by Mr. Brokawsubsequent to the investment that should have beenquestioned and more tightly managed," one sourcesaid. "He had virtual free reign over almosteverything with no oversight."

"Sperling's apparent unwillingness to bringoutside expertise onto Avenue's board limited theboard's ability to properly oversee Brokaw'sactivities," another source charged.

Reached at Avenue's office in Los Angeles,Brokaw denied that the company was not surprisedclosely enough by its investors at Aeneas.Sperling and Aeneas partner Tim Palmer are activemembers of Avenue's four-person board ofdirectors, he said.

The Aeneas team's management style is'responsible but hands off," Brokaw said. "They donot exert significant day to day control in anyway," he added.

Sperling said that his job is not to runAeneas' investments on a day to day basis.

"There are very few business--whether it's anentertainment business, or a semiconductorcompany, or a software company, or a bank--wherethe nature of our role is to tell the manager howto run the business on a day to day basis,because that's not our expertise," Sperling said."If we tried to do that, we'd only handicap thecompany."

Sperling also denied that Avenue is a failedinvestment, even though source have told TheCrimson that Aeneas has marked the movie company'svaluation down to zero.

In addition, the sources said and Brokawconfirmed that Avenue is liquidating many of itsassts. The Company is down to eight employees froma one time high of 27 and is no longer in thedistribution business, part of a settlement to alawsuit filed against the company and PhemusCorporation, an Aeneas subsidiary, by theproducers of the film Mr. Johnson.

In that suit, the plaintiffs--who asked inexcess of $20 million in damage--charged Avenuewith fraud and breach of contract for failing tocarry out its obligations as the movie'sdistributor, resulting in the film's poor boxoffice returns.

Mr. Johnson cost nearly $7 million to producebut has grossed only $1.5 million, according toVariety magazine, even though, according todirector Bruce Beresford--who directed DrivingMiss Daisy---the film received "good reviewsevery where it was shown."

Sources have told The Crimson that the suit wassettled out of court for approximately $100,000,with about $40,000 coming from Harvard.

Brokaw said that Aeneas' investment in Avenue"hasn't been a success," though he would notcomment on whether the investment was a wise onefor Harvard.

And Sperling said, "The jury's still out. wedon't know how it will do."

But a number of sources called the investment adefinite failure.