Fourth of July fight fiasco: How a Jack Dempsey title bout KO'd a tiny Montana town's finances

If you’re looking for the spot where Jack Dempsey defended the world heavyweight title against Tommy Gibbons in a fight that brought financial ruin upon an entire town on July 4, 1923, the directions are simple.

Head north on I-15. Keep going until the signs start listing the mileage to various cities in Canada. Then exit in Shelby, Montana, and follow Main Street along the railroad tracks.

You won’t miss it. There behind the Pizza Hut you’ll see Champions Park with the metal silhouettes of two boxers facing off in the middle. That’s supposed to be them, Dempsey and Gibbons.

On one side stands one of the most famous athletes of the 1920s, a man who would have to literally run out of town by the time the fight was over. On the other side stands a guy who was only promised enough to cover his training expenses in a clash for the heavyweight title.

This park marks the spot where a hastily built arena once stood. The plaques surrounding the two metallic figures tell the story, from “the set up” to “the con,” of how their Fourth of July fight 101 years ago resulted in one of the worst economic disasters in boxing history.

It started almost as a joke. In the early 1920s, oil strikes around this region of central Montana had made the locals overly optimistic about boom times to come. A wildcatter named Gordon Campbell struck oil with the Discovery Well in 1922, and soon people began hailing Montana’s Toole County as “the Tulsa of the West.” Those people were mostly the ones already living in Toole County, with their eyes full of dollar signs at the thought of everything the oil business might soon bring their way.

That oil brought an influx of people to Shelby, the county seat. Oil workers and their families came in waves, and with wages to spend, which translated to opportunity for would-be real estate developer James “Body” Johnson, son of Shelby mayor James A. Johnson.

To the younger Johnson, the combination of Shelby’s nascent oil industry and its location along the railroad line made the town a prime candidate for rapid, profitable growth. All it needed was some positive press to nudge things forward.

So when Johnson read a newspaper story about the city of Montreal offering $100,000 in a bid to host Dempsey’s next heavyweight title defense, he got what he must have thought was a brilliant idea. Johnson wired a message directly to Jack “Doc” Kearns, Dempsey’s manager, offering to double Montreal’s price in order to bring the fight to Shelby.

Dempsey and 'Doc'

Johnson, didn’t know it, but from the moment he reached out to Kearns he was in over his head. As he wrote later in a slim volume titled “The Fight That Won’t Stay Dead,” the whole thing was meant to be “nothing but a publicity stunt.”

His hope was that, just as Montreal had made newspaper headlines with its six-figure offer, Shelby would get similar press for doubling it. He didn’t think there was much danger of Dempsey’s manager taking him up on the offer. Shelby was a tiny town in north-central Montana with one hotel, two banks and zero arenas or stadiums in which to hold the fight. Who would possibly agree to bring a world heavyweight title fight there?

But Johnson didn’t fully understand who he was dealing with. Kearns had traveled an interesting and often criminal path en route to getting his hands on boxing’s biggest draw. Before he ever met Dempsey he’d already been either accused or convicted of offenses ranging from fight-fixing, forgery, running crooked gambling operations, embezzlement and all manner of grifting. He was even rumored to have kidnapped sled dogs during a stint in Alaska. Later, his mere involvement in some fight sports enterprises was enough to get the venues raided by police.

As a manager of various small-time boxers, Kearns developed a routine of discarding one fighter for whomever beat him. This is how he found Dempsey, who had spent much of his career to that point as essentially a boxing hobo, drifting between various Western mining towns and fighting whomever he could for whatever money the locals could scrounge up.

A favorite technique of Dempsey’s was to walk into a saloon and loudly declare: “I can’t sing and I can’t dance, but I can lick any son of a bitch in the house.” Then, if anyone could be found who might disagree, a hat was literally passed until it filled up with enough money to make it worthwhile for the two principals to fight over it — winner take all.

Funny story: Jack Dempsey wasn’t even Jack Dempsey at first. He was born William Harrison Dempsey in June of 1895 in Manassa, Colorado. His older brother sometimes fought under the name Jack Dempsey, hoping to draw some attention by conjuring people’s memories of “Nonpareil” Jack Dempsey, the Irish-born middleweight champion of the late 19th century.

But after his brother backed out of a scheduled fight in the Colorado mining town of Cripple Creek, the younger Dempsey stepped in to replace him, fighting under the same name. This didn’t fool people, and the promoter of the fight was displeased, but the skinny kid fighting under the name Jack Dempsey proved out, battering his opponent en route to a referee stoppage, which was uncommon at the time.

“In those days they didn’t stop mining town fights as long as one guy could move,” Dempsey later recalled in one of several autobiographies. (My personal favorite, “Dempsey,” also has the advantage of a fantastic opening line: “I am William Harrison Dempsey, a Jack Mormon, ex-heavyweight champion of the world, rich in friends, richer in loved ones, comfortable in the world’s goods.”)

Dempsey’s early career was marked by furious, frequent brawls and predatory managers. More than once he hopped a train into town, earned a small pile of money with his fists, then woke up the next morning to find that his manager had taken that pile and hopped a train elsewhere without him.

Kearns was far from an honest manager, but at least Dempsey’s career prospects improved in his care. Dempsey had essentially been run out of Utah after a first-round knockout loss to “Fireman” Jim Flynn resulted in accusations of a fix. Dempsey always denied this, at times suggesting instead that the suspiciously early knockout was the result of Flynn clocking him when he went to touch gloves at the start of the fight. About 40 fights and a little over two years later, Dempsey became the heavyweight champ after beating Jess Willard on July 4, 1919.

It’s those championship years from 1919-26 that people remember best about Dempsey’s career, but they comprised a relatively small slice of it. He fought fewer than 10 bouts after becoming champ, compared with at least 75 fights leading up to it. But with help from Kearns and New York-based promoter Tex Rickard, he became a legitimate sports superstar in the Roaring '20s, one of the nation’s few instantly recognizable sports figures.

The idea of bidding for the right to host a Dempsey fight began to seem like a good idea after his 1921 title defense against France’s Georges Carpentier (delightfully nicknamed “The Orchid Man”) in Jersey City, New Jersey, broke records with boxing’s first million-dollar gate. Time magazine later put the live gate total of the fight at $1,789,238. (Rickard’s cut of this was said to be around $550,000, equivalent to about $9.6 million today.)

For almost the entirety of his title reign, Dempsey was box office gold. The first five million-dollar gates in boxing were all Dempsey fights. No fight eclipsed $1,000,000 in live gate again until Joe Louis vs. Max Baer in 1935. In fact, from Dempsey’s fight with Carpentier until his retirement in 1927, only one of his fights brought in under seven figures.

That fight, of course, happened in Shelby, Montana.

‘The financial ruin of many Montana citizens’

Johnson had never really intended to pay $200,000 to bring the fight to Shelby. That’s because, for starters, he didn’t have the money. When word of his offer began to circulate, Montana Gov. Joseph Dixon chided him for it, reportedly saying, “Hell, man, there isn’t that much money in the whole state of Montana.”

But after pitching the idea to several area banks and other investors, Johnson managed to gather $100,000. This he gave to Loy Molumby, a lawyer and World War I pilot who also served as the commander of the Montana American Legion, which had agreed to sanction the fight. Molumby traveled to meet with Kearns, and by the time he returned (after supposedly being wined and dined by the famously hard-partying Kearns), the financial commitment to secure the bout had gone up to $300,000.

Kearns and Dempsey had agreed to accept the money in three installments, but the backers in Shelby struggled mightily to come up with even the second payment. With the fight scheduled for July 4, a deadline of June 15 had been set for payment of the second $100,000 sum.

In what was part fundraising tour and part publicity campaign, Johnson hopped in a plane piloted by the former WWI ace Molumby and flew to American Legion posts all over Montana to boost ticket sales and investment in the fight. That plan seemed to be working, but while returning from the town of Livingston in southwest Montana in early June, the plane crashed. Johnson and Molumby were injured but lucky to escape with their lives.

The plane crash stalled the fundraising efforts just prior to the deadline. Dempsey had already set up his training camp for the fight in the nearby city of Great Falls, about 85 miles south of Shelby. When the second payment didn’t arrive on time, Dempsey began considering alternatives.

As he told newspaper reporter Maxwell Stiles years later, he was “already having trouble with Jack Kearns and had made up my mind to retire when this fight came up.” From the start, Dempsey claimed he didn’t believe there could possibly be so much money in a fight held in the middle of Montana. This, he said, was why he insisted on guaranteed payments in advance.

“Despite an oil and real estate boom, no second $100,000 was forthcoming when it was due,” Dempsey said. “So now the promoters brought the American Legion into the thing for a percentage of the profits, though they knew there would not be any profits and so did I. They had no way of handling the people. The town had only one main street and housing for the fans was nonexistent.”

Dempsey reached out to Rickard, who had a 10-year lease of Madison Square Garden. Rickard offered to move the fight to New York and refund the $100,000 payment that Montanans had already provided.

“I told these people Rickard’s proposition,” Dempsey said. “They said no, the fight will be in Montana. Kearns got tough about then and they came up with the second $100,000. But when the final $100,000 came due there just was no more money.”

As the Fourth of July grew near, the missed payments became a bigger story than the fight. Kearns told newspaper reporters that the fight was off, then back on, then off again. The uncertainty killed ticket sales, especially since the financial success of the bout was dependent on fight fans traveling from far away to attend an event in a place that had no other forms of entertainment or even reasonable accommodation to offer.

By this point, a lot had already been invested in making that plan feasible. The Great Northern Railway had laid miles of extra track and booked somewhere in the neighborhood of $500,000 in ticket reservations. Over 200 carpenters had worked frantically to build an enormous open-air arena in Shelby, all in less than two months. As word spread that the fight was in jeopardy, all this work seemed like it might be for nothing.

“Trains had been canceled and I was blamed for this circumstance that contributed to what they called the financial ruin of many Montana citizens,” Dempsey said.

Kearns, on the other hand, was known to brag for years afterward that he’d swindled and ruined multiple Montana banks in the deal. Remorse never seemed able to find the man.

‘If you don’t have the guts to rush the gates, then stay the hell out!’

The Montana backers of the fight tried everything they could think of to keep the fight together, including offering to pay a portion of the guarantee in the form of sheep. Dempsey and Kearns grew increasingly angry at how the event was shaping up. When Dempsey grumbled about it to reporters from his training camp in Great Falls, it did not endear him to fans in Shelby, who came to regard him as a rich, spoiled professional athlete. The enmity was mutual.

“I was mad at the Shelby people for having turned down Rickard’s offer to get them off the hook and for expecting me, after that, to go on with the fight without my money,” Dempsey told newspaper reporters later. “So Kearns and I demanded the final $100,000 and when it was not forthcoming, Kearns called the fight off at 2:30 in the morning. After a couple hours the fight was on again and we agreed to gamble on the gate by taking in the first money to come in toward our third portion of the [$300,000]. When I arrived in Shelby at 10:30 a.m. I was met by a hostile crowd calling me ‘slacker’ and all sorts of names for my having demanded my money.”

The slacker accusation was a sore spot for Dempsey. He’d been accused of avoiding military service during World War I while continuing to box professionally. He was later cleared of any wrongdoing after proving that he’d received a hardship exemption from the U.S. Army, but the slacker claim remained a favorite epithet for Dempsey detractors even years later.

By contrast, Gibbons showed up on fight day as something close to a local hero. Unlike Dempsey, he’d opted to set up his training camp in Shelby, which had proven to be a popular move. Locals felt like they’d gotten to know Gibbons over the weeks leading up to the fight. Many of them had watched him train, paying 50 cents a person to view his sparring sessions. Outside of the money he received to cover his expenses, it was the only profit Gibbons made from the fight.

The arena was built to hold around 40,000 people. The official paid attendance was later listed at 7,202 tickets sold, though the actual number of spectators who saw the fight was estimated to be about three times that. This is because, as anger at Dempsey and Kearns grew, a crowd that could fairly be described as a mob gathered outside the arena, demanding to be let in.

One security guard, apparently overwhelmed by the size of the gathering but also frustrated at being asked to simply stand aside, is said to have shouted: “If you don’t have the guts to rush the gates, then stay the hell out!”

This was all the invitation the crowd needed. As Dempsey put it later, according to a local newspaper report: “When the report came out that I was going to get the gate money, the cowboys threw lariats over the posts and pulled the gates down. Thousands of people got in free.”

The fight itself was tougher for Dempsey than many expected. He’d had a year off after the fight with Carpentier and had trouble getting in shape after toying with the idea of retirement following that blockbuster bout. Gibbons stayed with him for all 15 rounds as Dempsey struggled to land a clean blow.

“Nailing him was like trying to thread a needle in a high wind,” Dempsey said later.

Fans — even the ones who hadn’t paid to get in — were disappointed at having sat so long under a burning July sun to see such a lackluster fight. Many accused Dempsey of carrying Gibbons. They’d been promised a heavyweight knockout artist and felt they were getting less than his full effort due to his complaints about money. When Dempsey was announced the winner via decision, empty bottles and other refuse came sailing into the ring.

“When it was over I just wanted to get out of town,” Dempsey said. “I ran all the way to the train, a distance of about one mile.”

Kearns stuck around in Great Falls slightly longer, hoping to collect the last of any money that might still trickle in. The mood around him, however, grew uncomfortably hostile. One report claimed that Dempsey and Kearns had only agreed to go on with the fight when “Montanans let it be known they had boxes of a certain size and dimension all fixed up for anyone trying to cross the border with $200,000 for a fight that was never held.”

Now that the fight had been held and the dissatisfied local populace began to feel themselves slighted and swindled by the whole affair, Dempsey and Kearns decided that a swift exit from the state with a notable history of frontier vigilantism was in their best interests.

'The fight that won’t die'

Kearns and Dempsey parted ways a few years later, then later took turns suing each other. At one point Dempsey claimed Kearns had handled at least $5 million of his earnings, yet always found a way to avoid providing any written accounting of it.

Kearns later wrote an autobiography to be published posthumously. In it, he claimed that he’d helped Dempsey pack his gloves with plaster of paris to defeat Willard for the title, an accusation that was leveled at Dempsey at the time but never proven. Dempsey successfully sued to keep that claim out of the book, but seemed to almost marvel at this twist of the knife from beyond the grave.

“Jack Kearns had managed to give me one more good swift kick in the butt,” Dempsey wrote later. “The man was not to be believed.”

Kearns later wrote of himself that he was a byproduct of the hardscrabble American West in the early 20th century, “when it was every man for himself.”

“In those times you got away with everything possible,” Kearns wrote. Those times, he went on to suggest, had never truly ended.

Within a month of the fight, Shelby’s two banks closed. Another in Great Falls and a fourth in nearby Joplin also shut down due to financial losses related to the fight. To the extent that Shelby was known at all outside Montana, it was as the town bankrupted by an ill-conceived boxing match.

For decades after, many Shelby residents preferred to forget the ordeal. The rest of the 20th century passed without even a marker to mention that the space where the Pizza Hut now stands had once hosted a heavyweight title fight featuring one of boxing’s all-time greats. Champions Park, with its metal silhouettes and extensive history lesson collected on the surrounding plaques, wasn’t constructed until nearly a century after the fight.

Today you can find an impressive collection of artifacts relating to the fight at the Marias Museum of History and Art, just up the street from the site of the bout. From the outside, it looks like any normal home. Inside, you can find everything from 100-year-old fight programs and tickets to the actual gloves worn by Gibbons that day.

Original flags commemorating the fight also adorn several of downtown Shelby’s few bars. The bell from the fight ended up at The Tap Room bar, where it was presented to the owner in lieu of payment for an extensive bar tab that one of Dempsey’s trainers had racked up during his brief time in Shelby. There are those around town who claim to have actual seats from the deconstructed arena, passed down through generations, now collecting dust in their homes.

These days, this community of about 3,200 people is primarily a railroad town. While people here have slowly embraced Shelby’s place in boxing history, there are still those who see it as a chapter best forgotten — and aren’t especially eager to talk about it with reporters even now, with all the participants long since dead.

“They call it the fight that won’t die,” one local told me over a drink at the Mint Bar on Shelby’s Main Street. “Well, maybe it would die if you’d let it.”

This sentiment was shared by many of those who lived through the event. The fight wrecked the local economy for a time, and even bankrupted individual residents. The stain of it followed “Body” Johnson for the rest of his life, even after he left Montana for good.

As he put it years later, looking back on his life: “I was glad to have nothing to do with the fight business again.”