Whitney Houston John Malkovich | Rosie O'Donnell

Arista Chief Conflict on Whitney Album?

A third of the songs on Whitney Houston's new album are published by a company owned by her record label's president.

The publishing company is Hitco, and it's owned by L.A. Reid, head of Arista Records, a division of Bertelsmann BMG Music Group.

Three of the 10 new songs on Houston's new Arista album, Just Whitney..., are published by Hitco, potentially creating a conflict of interest for Reid.

About two years ago, I told you that Reid, the new head of Arista, also owned Hitco. Signed to Hitco were producers and songwriters who essentially were Reid's clients. If they had hits, he made money. Personally. At the time, Reid said BMG Music, which owns Arista, knew he had the publishing company and didn't mind.

Reid said of Hitco: "I'm not allowed to run it. But you can't stop me from owning it." He also told me that "it never came up" about his ownership when he negotiated his deal with then-BMG Music President Strauss Zelnick, who was fired a few months later.

Now Reid, who has worked hard in the interim to establish himself as a leader in the record industry, has picked the songs for Whitney Houston's new album on Arista. And wouldn't you know it? The new single, "One of Those Days," is produced and written by Kevin Briggs and Patrice Stewart, who are Reid's clients. The song's publisher is Hitco, which Reid still owns and maintains through Windswept Pacific Music. He is listed as the president and founder on Hitco's Web site.

But that's not all. Briggs and Stewart also collaborated on "Dear John," a second song included on the finished album.

A third song written by Briggs and Stewart, called "Let's Go," was intended for Houston's album, but is not included so far on the final selection. It was nevertheless recorded for that purpose.

Additionally, another Hitco writer, Matt Bronleewe, also has a song that made the final listing on Whitney's album. It's called, appropriately enough, "Unashamed."

Calls to Arista, which is still dealing with the premature release of Houston's album on the Internet, were not returned.

Briggs, who performs under the name Kevin "She'kspere" Briggs, has his own imprint at Hitco. It's called Shek'em Down Music. Really. I kid you not.

This news means that one-third of the material on Houston's new album is published by Reid himself, who will not only get commissions for the singles and songs doing well, but will also benefit as head of Arista Records if the album is a smash. This is a lot different than the days of Berry Gordy owning Motown and Jobete Music Publishing, since Reid does not own Arista. BMG does. He is simply an executive there.

But putting Briggs' songs onto Just Whitney... should help Reid maintain his lavish lifestyle. Reid, as previously noted here, is one of the nattiest dressers in record biz history, favoring luscious Brioni suits with silk pocket squares.

Yesterday I told you that that Whitney's new album was all over the Internet, leaked a month early to Web sites for downloading. Even though I liked several of the songs, most of the online reviews have not been good. More than one listener worried that Houston was "sleepwalking" through the sessions and that none of the songs were compelling.

Most everyone said the same thing: Without Clive Davis, her former mentor, Whitney's turned in a mediocre record.

That may be, but I don't think that's fair to say before the general public and Houston's fans get to hear the whole record.

As for Reid, I don't know if other record company presidents also have their own publishing companies. I rather doubt it. Certainly some of them have been accused of managing acts on their own labels and taking hefty commissions. And many have found more surreptitious ways to get their slice of the pie. But actually presiding over a record company and picking one's own songs for the label's artist -- that may be a new act of hubris in the annals of an already very corrupt business.

Malkovich 'Mudd'-ies the Catwalk

Actor John Malkovich says here's mud in your eye. Actually, Mr. Mudd. That's the name of his menswear line of clothes he's launching, all designed by him.

Malkovich, who stars next in Ripley's Game, which will be released next spring, was the subject of discussion Saturday night at the movie's Hamptons Film Festival premiere.

His longtime pal and business associate Russ Smith told me that Malkovich has named the line after the driver he had when he made The Killing Fields. According to a weird online interview I found with Malkovich, the real Mr. Mudd was a convicted murderer. "Sometime Mr. Mudd kill. Sometime Mr. Mudd not kill," the man told Malkovich when asked about his past.

Malkovich's clothes so far are prototypes only, made for his actor friends and signed individually. "Everything is a sample," says Smith. "The clothes are very elegant. The sport jacket pockets have wonderful buttons, for example." The plan is to get the line going by word of mouth, then have a real manufacturer step in and take over. There will be no fashion shows, Smith says, featuring Malkovich running around backstage and instructing male models to pause or pout.

Meanwhile, Mr. Mudd, the movie production company is going great guns. In addition to Ripley, they produced The Dancer Upstairs with Malkovich and Javier Bardem. Their next project is yet another Ripley novel by Patricia Highsmith called Found in the Street. Malkovich's longtime friend and fellow Steppenwolf Theatre alumna, Terry Kinney, will serve as director.

As for Ripley, Fine Line Features will have a nice little hit on its hands when the release date comes. Early anticipation for the movie was obvious Saturday night as important folks like Mercedes Ruehl, Bob Balaban and wife writer Lynn Grossman, Roy Scheider, and Dina Merrill braved the crowds and stood on line for more than a half-hour to catch the premiere screening. Afterwards, this hearty crowd descended on the legendary East Hamptons eatery Nick and Toni's for a swell sit-down dinner.

Rosie Says Mag Publisher Knew It All up Front

As expected yesterday, Rosie O'Donnell counter-sued Gruner + Jahr for $125 million and then some. Ho ho. Her papers look pretty good. According to O'Donnell, the publisher knew up front she was gay and was leaving her show. It turns out she even paid them extra money because she left the show -- it was a penalty in the G+J contract. So there.

Much of Rosie's lawsuit seems pitched at the takeover of the magazine by editor Susan Toepfer, who Rosie did not hire or approve of. According to Rosie, Toepfer, who was purged from People magazine during their last civil war, immediately began acting without Rosie's consent on nearly all matters.

Here was a situation built for disaster. Toepfer, for better or worse, came from the shrill everyday celebrity battles at People. Rosie wanted a magazine completely different in attitude than People, which was reflected in a battle she had with Toepfer over Carol Burnett.

O'Donnell was going to interview Burnett about her new Broadway play written by her and her late daughter Carrie Hamilton. Not wanting to sensationalize her interview, Rosie planned on not asking Burnett about the death -- but would mention it in the introduction.

"And you're just going to ignore the dead kid?" Toepfer supposedly responded.

Talk about different agendas.

In the end, even though Rosie has asked for a jury trial, the two sides will probably settle. It's hard to imagine that G + J is stupid enough to take the case into court. Random House did that with Joan Collins and lost. The Los Angeles district attorney did that with O.J. Simpson and lost. Let's face it, whether or not the case is good or bad, juries are swayed by celebrities. And Rosie is one of the most compellingly sympathetic in history.