WHEN BRUCE WILLIS first moved to Idaho in 1988, he said that he wanted a home where he could get away from it all. He didn't want to be the action hero of Die Hard 365 days a year; he and his wife, Demi Moore, had a growing family to protect from the Hollywood craziness, and the mountains of rural Idaho seemed the perfect place in which to be "just regular people".

Yet the trappings of celebrity proved harder to shake off than Willis and Moore might have anticipated. Instead of blending into the landscape - the great fantasy that has lured celebrities to Idaho's Sun Valley area for the past half-century - the glamorous couple found it hard to resist the temptation to put their own stamp on their surroundings.

At first it was a matter of remodelling their ranch home and buying up the lots next door to give them extra space and privacy. Then, starting in the early Nineties, they began to buy property in earnest in the centre of Hailey, the small working-class town, 10 miles south of the main Sun Valley ski resort, where they had made their home.

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The project started out as a romantic and generous-minded dream: to give a dingy former mining town a touch of class. An old launderette was turned into an elegant red-brick shopping and office building, with a Fifties- style diner called Shorty's installed on the ground floor. The crumbling Liberty cinema was tarted up in lavish Art Deco-style and given plush seating and a sound system to match the best Hollywood screening facilities. A dive bar called the Mint was gutted and rebuilt to house a nightclub, bar and restaurant where acts like BB King and Bo Diddley would make appearances, to the astonishment of the local populace.

By the mid-Nineties, Hailey was swinging. Willis's local real estate company, Valley Entertainment, employed 250 people - almost 10 per cent of the town's active population. The town was bursting with tourists, celebrities and local Idahoans who flocked to its nightspots and basked in reflected glory. Shorty's was packed - so much so that two older diners in the town went out of business. The Mint never stopped hopping. For the first time in decades, business drained away from Ketchum, the main Sun Valley resort, and flowed towards this unlikely bump of a town that was previously regarded as little more than an irritating set of traffic lights on the route from the Hailey-Sun Valley airport to the snowgrounds in the north.

But as Hailey's fortunes were transformed, so was its perception of Bruce Willis. From being a guy who just happened to be generous with his money, he had turned into a business tycoon. Just as surely as he had launched the Planet Hollywood franchise, along with Sylvester Stallone and Arnold Schwarzenegger, so he had turned Hailey into his own little empire. Planet Haileywood, the locals called it, with a mixture of admiration and disdain.

While times were good, the Bruce Willis show suited them just fine. Then came trouble. A slew of box-office failures began to threaten Bruce and Demi's A-list status. Their marriage hit the rocks and ended in separation in the middle of last year. Planet Hollywood slid inexorably downhill, the victim of over-rapid expansion and an inability to cover the shortcomings of indifferent catering with a glitzy showbiz come-on.

Then, in May last year, Willis abruptly closed down Shorty's and the Mint and fired everyone who worked there. There were no explanations. He withdrew all further investment from Hailey, leaving two buildings empty on Main Street and plans for a children's recreation centre and swimming park unrealised. The firework displays he had paid for at Christmas and on the Fourth of July ended too. Contractors began complaining that they were owed money, and a couple took Valley Entertainment to court, as did a clutch of disgruntled ex-customers and employees. Hailey veered from boom to depression. The beautiful people began to ignore it once more, and much of the central block of downtown was shuttered up.

What could cause a movie star who had wanted to be accepted as one of the guys to change his mind so suddenly? What kind of bitter feelings would be left behind, in a town that had had its hopes raised beyond its wildest imaginings only to have them dashed? What did the story of Hailey have to say about the corrosive influence of celebrity on ordinary lives, and about the culture clash between a high-powered Hollywood sophisticate and a down-at-home small town in the middle of nowhere?

Those were the questions I intended to answer when I visited Hailey a few weeks ago. What I found was altogether more bizarre, and more unsettling.

CLICK. CLICK. Flash. I was sitting in my rental car just off Main Street when I noticed a man in the parking space next door taking picture after picture of me. At first I thought it was a joke, so I wound down my passenger side-window and smiled for the camera. But the pictures kept coming, five, 10, 15, 20. I asked the photographer, a muscular, dark-haired man in his early thirties, why he was taking so many pictures of me. He didn't answer. Next to him, a skinny kid with streaked blond hair pulled out a disposable camera and started clicking away alongside him. Click. Click. Click.

Unnerved, I got out of my car and made a point of examining the front licence plate of their dark-blue, four-wheel-drive Chevy. Then I approached the driver's side window and again asked why they were photographing me. No answer. I put my hand up in front of the burly man's lens and said: "Hey! Can you answer my question?"

He snapped back: "Don't put your hand inside of the vehicle. That's assault!" And he reached down, almost theatrically, for what might have been a mobile phone, or a gun. I backed off, crossed the street to the offices of the Wood River Journal, Hailey's weekly newspaper, and asked the staff there if they recognised the two men. Looking back at them, I noticed that the dark-haired one had pulled out a video camera and was training it on me, filming through the plate-glass front of the newspaper office. Then he stopped, and the pair pulled out of the parking space and drove off.

As the morning wore on, I saw the odd couple again and again. The skinny kid had got hold of a camera of his own and was sitting in the passenger seat of a silver BMW convertible. He and the burly man in the Chevy seemed to be communicating by mobile phone or walkie talkie - it was hard to tell which - and at every corner I found one or the other staring at me, driving slowly by me, obsessively photographing and videoing me.

When I went back to my hotel, a large blue Chevy pulled up into a public car park within view of the front door and sat there for half an hour. When I came back out and walked down Main Street, the photography began all over again. By chance I stumbled upon a sheriff's deputy's car and, on impulse, flagged it down. I explained what was happening - in part because I was beginning to be concerned for my safety. They ran an identity check on the licence plates. The voice of the dispatcher crackled through the car radio as I heard: "5B 39269, '99 Chevy, licensed to Bruce Willis of Hailey."

I was, I discovered, not the only outsider to be followed and photographed in this way. In August, two journalists who had been commissioned to do a television piece for a small cable station, the Independent Film Channel, were confronted as they stood on a pavement outside the Mint. Abuse was hurled at them and their cameras were pushed aside. They were told they would be arrested if they carried on filming. Footage from the pair, Brian Flemming and Keythe Farley, showed a similar burly man (this time he had a beard and claimed to be an ex-Navy SEAL) and a similar BMW convertible. Flemming and Farley filed a complaint with the police, but no charges were brought.

Flemming and Farley subsequently received a phone call from Bruce Willis's Los Angeles lawyer, Marty Singer, who accused them of "tortious conduct" and threatened to file a lawsuit if their piece was ever aired. Singer also wrote a three-page letter to the Independent Film Channel. "This is not an idle threat. If you broadcast the segment containing defamatory information about our client, be assured that you will be sued," the letter said.

Singer and Willis had not seen the piece and made no specific accusations, but the IFC decided to avoid trouble and cancelled its broadcast. The 16-minute film had also been scheduled for a restricted screening in Los Angeles through the Independent Film Project, but this too was cancelled. According to the IFP, a media organisation may lose its eligibility for liability insurance if it is warned in advance of a possible lawsuit. Hence the caution.

The deeper I dug, the more I established what appeared to be a pattern of, to put it mildly, extreme defensiveness on the part of Willis and his associates, particularly towards the media. It also became clear that news organisations were highly reluctant to run stories on his activities in Hailey. Kim Masters, a staff reporter for Vanity Fair, spent several days in Idaho in June 1998, just before the divorce announcement broke, but her piece never appeared - for reasons the journalist says she never discovered. A year earlier, the Wood River Journal incurred Willis's wrath by running a piece about a government report into below-market-value leases of public lands. The piece, which listed several celebrities who had benefited from such deals, was illustrated with an uncaptioned picture of a cabin at Petit Lake that belonged to Willis.

"He came in here enraged, saying we were intruding on his privacy, and cancelled all his advertising," said Wayne Adair, the Journal's news editor. "It wasn't very smart. The next week we ran a story about him cancelling his advertising account, and the story was picked up by the national news wires. When our original story ran, there was no way of telling the cabin belonged to Willis unless you knew already. After all the fuss, the whole world found out."

The effort to impose radio silence has not been restricted to journalists. Employees of Valley Entertainment were made to sign fat non-disclosure agreements promising not to discuss any aspect of their employment with outsiders. A couple of years ago, at a Hallowe'en party for eight-year- olds attended by the Willises' second daughter, Scout, Demi Moore freaked out when she saw one of the other mothers snapping party photos. She sent over her nanny, who ordered the mother to hand over the camera so she could rip out the film. The mother refused, according to an account given to me by the event's caterer.

Around Hailey, a number of people said they had been warned not to talk to journalists. E Lee Schlender, a Hailey lawyer who has represented plaintiffs in two suits against Valley Entertainment, said that an acquaintance of his who knew Willis approached him after he had talked to a visiting reporter and berated him: "You're in trouble. You don't talk to the press about Bruce Willis."

In dozens of conversations around Hailey, people would shrug their shoulders when asked about Willis and say: "He's a nice-enough guy." But something in their demeanour suggested a reluctance to say anything that might land them in trouble.

"You've got to understand, I live in a small town," said an estate agent who works from the EG Willis building, her eyes full of trepidation at the very act of talking to a journalist. "Do you know what it means to live in a small town?" She begged to have her remarks kept off the record, but she was so reluctant to say anything, even on a relatively harmless subject like fluctuations in the housing market, that there was nothing to report, on the record or off. When I told her about the men following me around with cameras, the look in her eyes turned to panic. She pretended she hadn't even heard what I had said.

"It's farcical. Willis and his goons act like they think they are operating some kind of speakeasy in New Jersey," thundered Lee Schlender. "The way they act, you half expect them to pull out tommy guns. I'm disappointed the political authorities haven't had something to say... This proprietary grasping at what is said and done by the press is unsettling too. You've got to ask yourself: is he hiding from something?"

WILLIS HIMSELF would argue that he is hiding from his own celebrity: that he is forever having to guard against the encroachments of paparazzi who are out to wreck his privacy; of shady businessmen hoping to overcharge him or take him to the cleaners in court; of opportunists big or small who want to make a buck out of his name. At least, that is what his defenders and apologists say. Willis himself has consistently refused to talk to the media about his activities in Hailey, and my own request for an interview on the subject went unanswered.

Yet if his intentions were merely to live quietly and manage his investments without attracting undue attention, he has chosen a strange way to go about it. The working-class kid from New Jersey didn't choose Sun Valley by accident; it was ideal terrain in which to prove himself, to show the world that he had arrived. This area has been the playground of the rich and famous since the Thirties, when the railroad tycoon Averell Harriman thought it would be a fine resort in which to entertain his friends. As attested by the finely mounted black-and-white photographs on display in the Sun Valley Lodge, the country club-style hotel at the foot of Baldy Mountain, this was where Gary Cooper, Mary Pickford, Ernest Hemingway and Glenn Miller came to relax; where Norma Shearer fell in love with a ski instructor and married him; and where they set the old Sonja Henie movie Sun Valley Serenade - which turned the place into a national myth and America's very own Cortina d'Ampezzo.

Willis's first idea was to invest in Ketchum, the focal point of Sun Valley's fabled elite, just a mile from the Sun Valley Lodge. He opened a now-defunct bar, the Dyno-Mite Lounge, and envisaged setting up a performing arts centre, a second bar and a restaurant that would be connected to the Dyno-Mite by a skywalk stretching over Washington Avenue. But the Ketchum authorities denied him planning permission. Wounded by their rejection, he picked on a town his own size, a place where he could do what he wanted and be undisputed master of his domain. Down-at-heel Hailey fitted the bill perfectly.

At first, Willis's money flowed as though there was no tomorrow. For example, he bought the shabby Mint for $200,000 and ended up spending $1.5m on renovating it from scratch. For his rethink of the Liberty cinema, he installed Bolivian rosewood panels and loveseats in the balcony. His local business manager at the time, a childhood friend called Joe McAllister, revelled in the preposterous luxury of it all, saying that if he was interested in making the Liberty profitable he would have to charge $50 a ticket instead of the usual $6. "The Liberty is about romanticism, not a return on investment," McAllister announced.

In addition to their $7m home at the Flying Heart Ranch on the northern outskirts of Hailey, the Willises snapped up the neighbouring lot (for privacy) and then set their sights on an adjoining "guesthouse", which had just been built from scratch by a local lawyer, Ed Lawson, and his wife, Julie. Willis made such a generous offer that Lawson felt compelled to accept it. Popular wisdom in the town is that he made $200,000 in clear profit, although Lawson himself refuses to talk figures.

In search of a new home, the Lawsons then bought the Friedman Mansion, a dilapidated Victorian house off Main Street which they proceeded to renovate. Again, Willis liked what he saw, and again he made an offer way over the odds. He gave the mansion to Demi Moore for her 30th birthday, and she proceeded to fill it with her collection of 2,000 porcelain dolls.

"What Bruce Willis wants, Bruce Willis gets," Lawson said. "He makes up his mind what he is going to do and does it." That's a line you hear a lot around Hailey, and in the early days the locals marvelled at Willis's acts of generosity. He would throw all-night parties at the Mint and open the bar to all-comers, free of charge. He held movie premieres at the Liberty - of his own films, of course - flying in his Hollywood friends, renting them limos and hosting them for the duration of their stay.

"People realised that none of this made economic sense, but they allowed themselves to lulled by it anyway," reflected CJ Karamargin, a journalist who covered Willis's business affairs for the Wood River Journal for four years. "To that extent the town was complicit in his pretensions to grandeur. And who could blame them? For a while, anyway, it was great."

One thing that Willis did not get, presumably because he did not want it badly enough, was the Hailey Hotel, an unashamedly downmarket bar and fleapit hostelry strategically placed on the opposite corner of the town's main crossroads from Shorty's. The hotel, which attracts the old working- class crowd that used to prop up the bar at the pre-Willis Mint, is run by Don Hogan, a hard-living man with gold rings on fingers and a near- permanent sweat on his brow, who relishes his account of the day Bruce Willis came to see him about a possible purchase.

"We talked for half an hour about what I'd do with the place if I had some money, putting waterbeds and fireplaces into the rooms, that kind of thing. He seemed to like that idea, and he liked the fact that I deferred to him as 'Mr Willis', and asked me for a selling price," Hogan said. "I gave him a figure but he thought it was too high. People have since said I refused to sell, but that's not true. We just didn't agree on the price.

"Then I cracked a joke and said, why don't you work the bar part-time, earn yourself some coin and then maybe you could afford it. Well, that hit his ego button. He jumped up and hit the wall. 'Don't you talk to me that way,' he said. Then he stormed out. I never saw him again."

I asked Hogan what he thought Willis had done for Hailey. "There's the positive and the negative," he said. "The positive is the money. The negative is attitude. A lot of people like Bruce Willis until they have to deal with him."

EVEN WHEN Bruce Willis's spending on Hailey was at its most lavish, rumours about a dark side to his empire were surfacing, with reports of fits of temper and a propensity for firing people first and asking questions later. Stories circulated about how he would declare the bar free on a Tuesday night, then chew out the same staff he had given that order to when he went through the books on a Friday night and saw how much alcohol had been consumed.

There were complaints about the heavy-handed tactics of the Mint's security staff, and a handful of customers ended up filing lawsuits. One out-of- town customer, Johnny Roleing, said he was kicked in the chest, grabbed around the neck in a chokehold, dragged across the floor and ejected. According to the complaint lodged with the Hailey District Court, he said he was thrown out after turning down an offer of illegal drugs from an employee.

Another customer, Dale Fischer, also filed suit after a disagreement with a bartender he knew. He claimed that he had his head rammed to the ground, was dragged by his neck, pushed down the stairs, and punched in the face so hard that his eye swelled shut.

Some of these suits are still going through the courts. Others have tended to go in Willis's favour. Willis's lawyers argue that the plaintiffs are largely opportunists with no real case to bring. Other observers express concern at the sheer number of complaints, proven or not. As Wayne Adair of the Wood River Journal commented: "Bruce Willis hires great lawyers. They are tough to beat."

One suit against Valley Entertainment that did succeed was a claim by a husband-and-wife plastering team for $8,000 of unpaid work on the Mint. A similar complaint by a heating and ventilation firm, the Eagle Company, for back invoices worth $54,000, failed, in part because Eagle's invoice records vanished in a computer failure.

But the really interesting story about Eagle is not the lawsuit itself, but what happened when its owners were giving a deposition to E Lee Schlender, their lawyer. "Willis charged into my office, dressed up in some Hollywood gear, glaring, snorting and blowing his nose," Schlender recalled. "I have to say I don't care for his films and I didn't recognise him. Maybe that pissed him off, because he was extremely obnoxious.

"I thought, my God, you're a billionaire and behave like this over a $50,000 construction bill? Don't you have anything better to do than try to intimidate people during a deposition? It was ugly, really ugly."

Such bluntly confrontational talk about Willis is rare around Hailey. "Look," Schlender said, "in my life I've been shot at, I've had brain surgery, I've broken every bone in my body. I'm from Idaho and I'm a tough guy. Why should I be afraid of Bruce Willis?

"What he's done to this place is turn it into a stage set he could make a movie on. He got the bands, the happening scene, the thugs, the huge cars, the klieg lights. This isn't reality. It's a projection of his on- screen persona."

During the boom times, the people of Hailey willingly offered themselves as extras in the great spectacle. But then the spectacle was brought to an abrupt halt. Nobody knows exactly why Willis decided to close Shorty's and the Mint and freeze almost all his other enterprises (the exception being the Liberty theatre, which continues to show wall-to-wall Bruce Willis movies). One theory is that the withdrawal had to do with his failing marriage: the closures came two months before the announcement of his separation from Demi Moore in early July last year. Another is that he had simply spent too lavishly and decided he didn't want to sustain the heavy losses any longer. A third is that this was just another example of the inconsistency that Willis had previously displayed when he wavered over a commitment to invest heavily in his home town of Penns Grove in southern New Jersey. None of these theories accounts for everything, though. The Mint may have been losing money, but Shorty's - according to its book- keeper - turned a profit right up to the last day,.

Whatever the reason, the end was brutally swift. "He came into Shorty's on a Sunday night, clapped his hands and said: 'OK. Close the place down. We're done,'" the book-keeper, Terra Korom, recalled. Staff were told not to report for work the next day, and were told they could pick up their outstanding pay the day after that. The outside world was told that the closures were temporary, simply a response to slack between the end of the ski-ing season and the arrival of the summer hikers. But the staff were in no doubt that this was the end. There were scuffles outside the Mint, and Valley Entertainment put black sheets in the windows to keep prying eyes away.

Korom has seen Willis just once since the closures, at a local air show. "He was real nice, asked how I was doing and all. He was a nice guy," she insisted. Did she ask him why she and her colleagues were all fired? "I would have loved to," she said, a brief excitement in her voice giving way to resignation. "But I didn't dare.

"He was a rich guy who could have what he wanted," she added. "If you disagreed with him, you'd lose your job and he'd get someone else to do it. There's no mileage in getting on the wrong side of him."

THE TOWN authorities seemed to agree. In the wake of the closures, the Hailey Chamber of Commerce issued a statement simply thanking Bruce Willis for everything he had done for the town. No bitterness, no indignant questions. Just thank you. The various mayors of Hailey during the decade have been similarly pro-Willis, perhaps in the hope that one day he might again give Hailey the benefit of some of his movie millions.

The town itself has moved on, largely thanks to a booming economy throughout Sun Valley. Coffee bars, a brew pub, various restaurants and a new hotel grace Main Street and do reasonable business. Shorty's has reopened under new management. Even the Mint has made sporadic weekend openings, usually to give Willis and his band, the Accelerators, a venue to thrash in; and one room is still used as a theatre for Company of Fools, Willis's personal troupe of stage actors.

Most of Valley Entertainment's fired employees have found other work easily enough. The Mint's first manager, Rob Cronin, and one of his deputies, Brendan Dennehy, have bought up a bar across the street, the Red Elephant, and made a great success of it. Both Cronin and Dennehy remain remarkably loyal to Willis, despite admitting that life at the Mint was "not for them". They insist that the stories of brutality by the security staff are exaggerated, and defend Willis's decision to close the place down.

"A business decision is a business decision. You can't think about people," said Dennehy, sipping a mid-afternoon cup of soup at the back of the bar.

In one sense, of course, Dennehy was right. This is America, and businesses get closed without warning all the time. That is the cold logic of the market. But in another sense Dennehy's indifference, and his apparent endorsement of Willis's actions, highlight the problem afflicting Hailey. This may be the way big-city tycoons and Hollywood upstarts behave on their home turf, but in a small town it is just not the way things are done. Besides, Willis never claimed he was in it just for the money.

Beyond the lip service paid to Willis's munificence, there are signs of real bitterness. "This guy swaggers into town, walking like his shit don't smell, and expects everyone to be grateful. Of course people are resentful," said a relatively recent arrival in town, a waitress at a coffee shop on the northern end of Main Street.

Part of the resentment stems from the fact that Willis and Moore are still around. Moore continues to live on the 20-acre property at Flying Heart Ranch and Willis, while spending more and more time away from Idaho, is none the less building himself a new house in the village of Gimlet, a few miles from his children. Even the new projects have not entirely dried up. Oliver Whitcomb, a martial arts instructor widely believed to be Demi's new beau, is building a gym just off Main Street, and private planes still fly into the Hailey-Sun Valley airport for big parties.

Complaints that many of these arrive after the legal time of 11pm have provoked little official interest. And, indeed, the police seemed unconcerned by my account of being followed and photographed (although the Blaine County sheriff's deputies had told me there were anti-harassment laws in Idaho that should prevent such activities). "It's not Willis," said Jack Stoneback, Hailey's police chief, without suggesting who else might be behind it.

What irks many locals is not so much that Willis and Moore came and went but that, after everything, they still act like they own the place and expect everyone else to fall into line. As such, they represent a new trend among celebrities in Sun Valley, towards finding visibility irresistible despite all protestations to the contrary. An old-fashioned resident like Clint Eastwood makes a point of driving a beaten up pick-up truck that, to the untrained eye, makes him indistiguishable from a local construction worker. By contrast, Willis, Moore and one or two others, such as Arnold Schwarzenegger, like to flaunt their Jeeps and their Hummers.

"Our local mantra used to be: we don't know, we don't see, we don't tell. We did well by the celebrities and in return we protected their privacy. It was an unspoken but widely practiced code of silence," said E Lee Schlender. "This experience has shaken our notions of how we behave around them."

Many Hailey residents maintain Willis and Moore weren't such a big deal. They were never the biggest employers in town, and although they made a lot of noise and caused a lot of disruption, they neither sped up nor halted Hailey's increasing enjoyment of the valley's economic spoils. "We were here long before them and we'll be here long after they're gone," Don Hogan asserted. That sounds like a statement of studied indifference. But it also expresses the defiance of a town whose pride has been wounded and which now feels faintly foolish at having believed an illusory scenario for a glitzy future that was scripted by, of all things, a Hollywood action hero. 2