With Mr. Mudd, partners John Malkovich, Russell Smith and Lianne Halfon are quietly amassing one of Hollywood’s most compelling development and production slates. David Geffner reports on the team behind such compelling indies as Ghost World and How to Draw a Bunny.

Developing genre-busting independent movies in Hollywood these days sounds like an oxymoron, but don’t tell that to Mr. Mudd. The production company co-founded by John Malkovich, his former roommate and partner-in-crime at Chicago’s Steppenwolf Theater, Russell Smith, and Lianne Halfon, a one-time v.p. of production and development at A&M Films, has produced such off-beat fare as How to Draw a Bunny, Ghost World, Kill the Poor and The Dancer Upstairs. In case you’re keeping score, that’s a feature documentary about an unknown painter, an indie feature based on a cult comic book, a digital feature starring David Krumholtz and a first-time director (Malkovich) shooting a Communist-themed romance in Madrid and Ecuador. Upcoming projects include Gordon Lish’s abstract tone poem, Dear Mr. Capote, Stephen Jeffreys’s The Libertine, adapted from his own Royal Court play and directed by Lawrence Dunmore, a Patricia Highsmith thriller and a Fresno-set teen novel set that reads like a Latino Boyz N the Hood.

Not your average development slate for companies with an overall studio deal, a Hollywood office and an Academy Award—nominated star signing its tax returns. But to expect anything conventional, in both process and product, from a group of filmmakers who named their company after a convicted murderer (Mr. Mudd was Malkovich’s driver on a movie in Thailand) would be silly. Not only are Mr. Mudd’s three key players intent on erasing creative borders in the literary source material they develop, they have little patience even for labels like "independent" and "mainstream".

Filmmaker caught up with two-thirds of Mr. Mudd’s trio, Lianne Halfon and Russ Smith, in their L.A. offices. They talked about their unique process, which includes "unbelievable pestering" of studio and distribution execs, as well as being the first to arrive and the last to leave their filmmakers’ sets.

Filmmaker: Hollywood moviemaking is often about predicting audience taste, but independent film production is driven by personal taste. Is there a consensus of taste here at Mr. Mudd?

Lianne Halfon: I think we have slightly different tastes but the same sensibility. Each of us might pick up a different book, but what that person finds interesting in that book will be something the other two will see as something that can make a movie. Russ reads completely different books than I read, but if he finds something interesting, I’ll get it. Or John may say, "I have a story about a pedophile," and we’ll say, "We don’t really want to have to go out and sell a story about a pedophile." But when he gives us the book, he’ll be right – there will be a great story in there. Russ and I resisted the idea of [adapting Gordon Lish’s novel] Dear Mr. Capote because we knew how difficult it was going to be to sell. It wasn’t until we found [screenwriter] Mary Kuryla and she thought how to turn it into a film that we decided, Let’s go ahead.

Filmmaker: So it’s a marriage of material and collaborators, not necessarily one without the other?

Halfon: Yeah. And sometimes we’ll meet somebody and love his or her sensibility. We’ll say, "Bring us something you’re interested in and we’ll help you." We can help whoever that is through the system. We don’t [have that attitude] you hear at the IFP so often: "I did it outside the system." We sort of march right through the system! You know, unless you are independently wealthy, there’s no such thing as an independent film. We’re interested in taking [industry] money and making our stories.

Filmmaker: To what degree does having John Malkovich as the person you hang your shingle out with affect the way you work on your projects?

Russell Smith: As a partner, John is very helpful because he reads well and gives terrific script notes. He’s capable of doing the development work, and he’s good in the editing room. He’s a guy with skills. For a long time, though, it was "John Malkovich’s company" whether we liked it or not. And I think if an actor or celebrity is involved in a company, then people believe everything has to be about that actor, that that actor has to have a role in every project. We actually ran into a bit of trouble with one project where [the other partners] just said, "Well, John is doing this." They weren’t even going to ask us! They kept saying, "So, John’ll be here tomorrow?" And we’re like, "What are you talking about?"

Filmmaker: How far along into the project was this?

Halfon: Two weeks before preproduction!

Smith: So, we purposely started developing projects that John had no role in, and it took us three years before we looked for a film for John to be an actor in.

Terry Zwigoff and Thora Birch on the set of Ghost World.

Halfon: I took [John] to one financing meeting on Ghost World, and it was a big mistake. It was a serious meeting, and because he was in the room, [the financiers] wouldn’t ask any of the hard questions. Sometimes people are intimidated by him, or mix up his onscreen and offscreen personas. He left thinking that we had just struck a deal, but I knew that they hadn’t said anything, that they were just being polite.

Filmmaker: Does the fact that you all met while working on the play Libra, and that John and Russ are so closely linked with the Steppenwolf Theater, affect the way you develop projects?

Smith: I think when you come from a theater background, you are constantly looking at adaptation and conversion into film from some other source, and that [process] becomes more interesting than poring through piles of scripts. You want the opportunity to take something and re-create it. The other good thing that comes out of theater [relating] to film is that in theater, you have very close relationships with the other artists. It’s a communal way of working.

Filmmaker: Well, a lot of great European film directors conducted their careers that way. Fassbinder and Bergman had companies they worked with time and again. Do you do something similar?

Halfon: We’re working with one writer, Mary Kuryla, who is about to deliver [a new draft] today, and who we have worked with on three projects.

Smith: All three are completely different. One is a Latino Boyz N the Hood, one is a police piece set in Venice, California, and the other is an adaptation of Gordon Lish’s novel Dear Mr. Capote. And every one of them she has put a distinctive voice on.

Halfon: We did Ghost World and now Art School Confidential with Daniel Clowes and Terry Zwigoff, and we’re doing an HBO television project just with Dan called Darlington.

Smith: We want to build our business on a series of what can only be described as these concentric circles – here’s our group, here’s Mr. Mudd, here’s the next circle beyond that, which includes Dan Clowes, Terry Zwigoff, Mary Kuryla, Stephen Jeffreys, Lawrence Dunmore and Terry Kinney. And then there’s a circle beyond that that would include John Walter, Lou Pepe and Keith Fulton. And of course there’s John Malkovich as a director.

Filmmaker: Speaking of John Walter, how did you get involved in his documentary How to Draw a Bunny?

Halfon: Because of Crumb, we get a lot of documentaries in various states of disarray. We were sent a book of [the artist] Ray Johnson, and it was amazing. I was surprised I didn’t know about him. Then we got the tape, and it was a complete narrative story. We made some editorial suggestions that [John] was receptive to, and then we thought, Let’s get involved with this. We understood from Crumb the strategy [to market and sell the film], and we made that strategy work. We did it all in a very low-key way, making the cards ourselves, printing posters at Kinko’s. We got Ray Price to give us recommendations like he did on Crumb on how to strategize, we paid very little money for a publicist, and we went to Sundance and it worked.

Filmmaker: When your films go into production, how "hands-on" are you?

Halfon: We are there every day on the set, we’re there at the answer print, we’re there at the mix, we’re there at the delivery. We supervise the transfer to DVD.

Filmmaker: Do filmmakers like the fact that you are so closely involved?

Halfon: Yes, I think they do. We’ve been there since the beginning [of their projects], so we’re very good at both protecting and promoting [their visions].

Filmmaker: The core of the industry is based here in Los Angeles. It’s a system that seems to have its own, strange equilibrium with regards to agents, casting and greenlighting material. How do you deal with all the various checks and balances to get your projects up and running?

Smith: There are certain agents that get us, and there are others that don’t and never will. It’s a system that we’re not part of. If we are interested in a particular actor, we’ll track that actor down. We’ll deal with the agent, but we don’t try to perpetuate relationships with people in the hopes that we’ll get some bone thrown at us at some point. One of the things we have learned in this business is that you will do a tremendous amount of favors for people, and they are never, ever, ever returned. "You got to do me a favor, you’ve got to meet with this actor, you’ve got to help me with this actor." "Okay, listen, you’ve got to do me a favor and get this script." "Oh, no, I can’t do that." It’s a one-way street.

Filmmaker: Are you funded by a studio or a company?

Halfon: We have a deal with United Artists, and we’re very happy. We would like to make more films than we can make just with UA, so we are looking for other places as well, but it’s a good association.

Smith: But they don’t fully fund our overhead. We have an investor.

Filmmaker: An equity investor outside the company?

Halfon: Yes. In Paris. But he’s American.

Smith: An American in Paris!

Filmmaker: John is starring in a Patricia Highsmith adaptation – Liliana Cavani’s Ripley’s Game – but you are all also producing another Highsmith novel, Found in the Street, which Terry Kinney is directing. How did that come about?

Smith: There was a period of time that I was a big mystery novel fan. I started reading Graham Greene in college, and Greene kicks you right to Highsmith. I loved the five Ripley books. I’ve read everything I think that she’s written, and most of her stuff, except for Ripley, tells the same moral tale over and over again. But there were a couple that stood out as things that could possibly be made into modern movies, and one of them is Found in the Street. It is set in a great location, Greenwich Village; it has "movie star characters" – the young girl, married couples, the security guy that kind of watches everybody. It had all that kind of tension. And I had been looking for something for Terry to direct. He was always the cinephile of the Steppenwolf directors, more than John and Gary Sinise. So I sort of said, "Here you go."

Filmmaker: Did you bring him on while the writer was working or after the writer finished the script?

Smith: One of the things that we do with directors is have them work on the script. You have to watch that process develop. You make sure the director understands how that script is going to progress, and then you can see [his or her] ability to tell a story. We’ve been working on [Found in the Street] for a nice five years.

Filmmaker: I remember interviewing Terry Zwigoff for another piece I did about Ghost World, and he struck me as one of the most accidental people making movies in Hollywood I could ever imagine. How do you convince – or coerce – an artist like Terry to buy into this whole moviemaking process?

Halfon: It’s true that people like Terry are sometimes not good at promoting themselves in an understandable way to Hollywood. You know, part of the way that [producers] convince financiers to part with their money is that they come in with the director as a kind of "quarterback" and ask the financier to have a level of confidence and comfort. We work with some quarterbacks, but we also work with people who are not quarterbacks, and Terry is a prime example. We had a meeting with Terry and the bond company. They said to Terry, "Do you feel you can do this on your budget?" And Terry’s response was a classic Terry response: "Gee, I don’t know. Your guess is as good as mine." He didn’t mean that he didn’t know; he meant that nobody knows. He was giving a Talmudic "Who knows?" And that is not what the bond company needed to hear. So the bond company left the room and said, "We don’t have a level of confidence, blah, blah, blah." So we tutored Terry. We said: "Never say ‘I don’t know.’ Always say, ‘Yes I can.’" He had another conversation with the bond company; he answered every question "Yes I can." They said, "He’s ready." And that was that.

Filmmaker: You guys have a good reputation as developers of material. Writers seem to respect the direction you give them, which isn’t often the case in the world of script development. What principles do you go by in terms of developing material and working with writers?

Smith: Clearly this town is full of people who can dissect a script and change its shape or form. But the two most important [questions to ask when you try to] "fix" a script are: Who is the filmmaker and what do they want that script to be? And then, how do you tell [a writer or director your notes] in a manner so that they get the "A-ha!" moment as opposed to the headscratching that happens after a lot of development meetings at studios. With Lianne a lot of times, [the process] involves some very creative and imaginative metaphors. I have writer friends who know how we work and would never work with us. Because their thing is they make the pitch to the studios, and business affairs does the deal. There is a meeting, the writer goes off, and four months later the script comes in and they have another meeting. We simply couldn’t do that.

Halfon: Keeping control through the script so that it maintains its shape – that’s what we’re interested in. [We make sure the script] doesn’t lose its shape and definition, that it doesn’t become something that so many people have taken a little piece out of that you don’t know what it is anymore. But we’ve been responsible for at least one person’s worst story meeting of their entire life, so it doesn’t always go well! I think the thing we have as producers is, we "get" [a writer or director’s] pitch. It’s not our pitch, it’s their pitch, and that’s what we try to [remember] all the way through. That’s what we do in casting; it’s what we do on the set.

Filmmaker: Many of your projects are derived from literary source material that, while often popular, is definitely off the beaten path. How important is it to make those themes that attracted you from the film’s source material accessible for marketing purposes?

Halfon: We don’t think what we’re selling is scary, and we try not to put it in scary wrapping paper. That’s been an adjustment for us over the years. Now we walk up with our hands in the air saying, "We come in peace!"

Filmmaker: Where is Mr. Mudd going? Do you have a long-term plan?

Smith: It’s going to have to get just a tiny bit bigger to hold the projects we have lined up. We may make four films this year and four films the following year. We’re trying to load up on development now for the year after that. We’re going to play around in the television business, not particularly the commercial television business, but there are a lot of channels out there. We will play a little bit more in that world, so I think we have to grow in three years by two to three people at the very most. The goal at the end of that period of time is to be able to find financing for our movies ourselves, to have a line of credit. We want to show we’re capable of continually putting out a stream of strong, interesting stuff, and then we want to be able to finance it ourselves.

Halfon: And we want to be able to do things on a shorter ramp-up. It takes us a long time to get these things going, and one of the reasons we’re attracted to TV is everything happens much faster. But I think that we’re interested in getting into a position where we have to do less explaining before the film is made. We’re moving toward that.