The sweet science certainly has the market cornered on hard luck stories. Tales of boxers experiencing championship-level greatness and ending up penniless is almost cliché. But very rarely do you hear of a town experiencing that same tragedy.

Shelby, Montana, a peaceful community just 30 miles south of the Canadian border, has such a story. On July 4, 1923, all eyes were on this little boomtown with a population of around 2,500 as it hosted a heavyweight title fight between the “Manassa Mauler” Jack Dempsey and Tommy Gibbons. Unfortunately, it paid a high price to rent the center of the sports world for a day. Lack of experience in the fight game and poor geography made the town easy pickings for an unscrupulous promoter, who would later brag about leaving the town in financial peril.

The idea to pursue this fight came in February of 1923, when James “Body” Johnson, son of Shelby Mayor James A. Johnson, read a front page headline in the Great Falls Tribune about Montreal’s offer of $100,000 to host Dempsey’s next bout. The Manassa Mauler had only fought exhibitions since defeating Georges Carpentier in July of 1921.

Body Johnson felt that bidding for a fight would bring positive attention to Shelby. The discovery of oil less than a year earlier had made the town one of the more prosperous cities in Montana. If Montreal could grab headlines by offering $100,000, then Shelby could make a name for itself by offering $200,000, almost $2.2 million by today’s standards, for Dempsey to fight journeyman light heavyweight Tommy Gibbons.  Dempsey had made $300,000 for his previous fight with Carpentier in Jersey City, New Jersey in 1921, so it was very likely that Shelby would have been outbid.

Montana law required boxing exhibitions to be sponsored by service clubs, so Johnson convinced the local American Legion to bankroll the fight. Then he wired Dempsey’s manager Jack “Doc” Kearns with the offer.

Kearns responded with the terms of “$100,000 to be part of the purse in event contest is held and balance of $100,000 to be paid me prior to contest as we mutually agree.” Whether it was a stunt or not, the Shelby businessmen could have financed a $200,000 fight and come out in the black.

To negotiate with Kearns, the American Legion brought in its in-state commander, Loy Molumby, Jr. In May of 1923, Molumby, an attorney, went to Chicago to bring Kearns the initial $100,000 payment and discuss the terms of the fight. The only problem was that Kearns had traveled on to New York. When Molumby finally tracked Kearns down in Manhattan, the promoter apologized and agreed to see him only if he had the front money.

Johnson would later insist that the bid for the fight was designed to do nothing more than boost real estate sales. “We were advertising, ‘Shelby, the Tulsa of the West,’ and believing it ourselves,” Johnson wrote in 1966. “Under no circumstances could I reveal to them that anything that might develop was, in fact, intended to nothing more than a publicity stunt.”

The stunt began to turn into a disaster at the bargaining table when Molumby, who had strict instructions to a deal for $200,000, signed a new deal with Kearns for $300,000.

How did this happen? How could a lawyer commit to an extra payment of today’s equivalent of a million dollars when he had no approval to do so? There are several varying stories. The general consensus in Shelby is that Kearns used alcohol to change Molumy’s mind. “People think that Kearns got him [Molumby] drunk and got him to agree,” says current Shelby Mayor Larry Bonderud.

However, according to Kearns, he had always demanded $300,000, and Molumby agreed to the price because of his hardball tactics. When Molumby sat down to negotiate a price, Kearns simply told him, “I ain’t here to play tennis.” Molumby seconded the story as well, telling Johnson, “I signed the contract because Kearns wouldn’t go for less.”

Regardless of how it happened, Molumby also made mistakes in other areas of the contract. In the early days of boxing, to prevent swindling from promoters, fight contracts often had 75% in guaranteed payments, with the other 25% going into an appearance bond. This was very similar to an escrow account. If a fight was cancelled, then the promoter and fighter would lose the bond.

Since Molumby had never negotiated a fight contract, he had no idea about the appearance bond and, in essence, gave Kearns a no-strings-attached $300,000 contract. This left the promoter with no need to promote the fight and gave him the power to cancel it as he pleased.

Shelby also faced another huge obstacle in that the town was not prepared for the thousands of people expected to watch the fight. The town went to work on a 40,000 seat, world-class boxing arena, constructing it in less than a month. An additional railroad track was also put in place.

Temporary hotels were put in to accommodate the huge influx of people. The town’s drive to make the quick changes was impressive but unconvincing. As Dempsey said years later, “How could a small town, with nothing to offer but three rooming houses, one hotel, a train depot and an oil field, possibly entertain the notion of competing with the great cities of the east?”

The first crisis came on June 15, when the second $100,000 was due and the Shelby businessmen financing the fight had only raised $1,800. This was due to ineptness on Molumby and Johnson’s part. After dispatching tickets to brokers all over the country, they assumed that the money would be sent as soon as the tickets were sold. An experienced promoter would have asked for front-end deposits from the brokers.

To get the necessary cash, Johnson, Molumby, and others took matters into their own hands. Molumby, a World War I pilot, flew the group to Montana’s American Legion posts in an attempt to pre-sell tickets. That campaign was cut short when their plane crashed. No one was killed, but many were injured, including Body Johnson, who suffered a broken arm, leg, and shoulder.

Kearns did not have any sympathy for their plight, saying, “You’ve got to pay Dempsey every red cent or you won’t see him at all. Don’t take us for fools, I warn you.”

To make the payment, Mayor Johnson tried many possibilities, including offering 50,000 sheep in lieu of the $100,000. Kearns responded, “What the hell would I do with 50,000 sheep in a New York apartment?”

The second payment was eventually made through fundraising and a $50,000 private loan to Mayor Johnson. However, Kearns, already having $200,000 and fearing that he would not receive his last payment, began voicing his concerns. News reports ranged from Kearns threatening to cancel the match to articles promising a “fight of the century.”

The differing reports caused many of those outside the state of Montana to cancel their train reservations to Shelby, costing the town its chance to break even. “At one time, around June 15, we had nearly $500,000 in advance reservations, and over 26 special trains and parties,” wrote Body Johnson. “Without exception, these were all canceled because of the adverse publicity.”

“The on and off again nature of the fight contributed to the lower than expected turn out,” agrees Bonderud. “The majority of the audience came from the nearby 200 mile radius of Shelby because they new the fight was on again and could make arrangements to attend.  The cancellation of trains by the Great Northern Railway really hurt the gate receipts.”

When Kearns finally accepted that he was not going to make his money, he announced the fight was off. But the oft-silent Dempsey overruled him, later saying, “In my first years with Doc, I did as I was told. He was the manager. I was the fighter. But by the time I got to Montana, I was 28. I wasn’t a boy anymore. I wanted to get back in the ring. I owed that to boxing. I owed that to the fans. I owed that to myself. I told Kearns, whether he liked it or not, I was going to fight Tommy Gibbons.” Kearns then relented, agreeing to take the last $100,000 out of gate receipts.

On the day of the fight, tickets started out at $25 for reserved seats, which is roughly around $280 by today’s standards. However, only 200 people were in the stands to watch the 1:30 pm undercard.

At 2:30, every ticket was marked down to ten dollars, with seating being first come, first serve. All in all, a total of 7,202 paid their way into the arena. Half an hour later, a crowd of 5,000 overran the gatekeepers and rushing into the arena without paying.

The fight commenced around 4:00 and was a lackluster affair by all accounts. The Ring magazine founder Nat Fleischer wrote, “Throughout the fight, the 32-year-old Gibbons, like a coyote, kept running and twisting, but got home safely at the end of the chase. He was panting, bleeding but safe when the final gong sounded. The bout was rather like a greyhound and hare affair.”

Dempsey, a little rusty from two years out of the ring, pursued Gibbons but had little luck of finishing up early. “Gibbons turned out to be a fine defensive fighter,” said Dempsey. “He was a perfectionist, not a slugger. For fifteen tough rounds, I could not corner him to score a knockout. Even though I was awarded the decision in the end, I felt that this fight hadn’t done my reputation or my popularity any good.”

Dempsey did not wait around to find out if he was well-liked in Shelby. He quickly hopped a train to Great Falls, Montana, and then went to Salt Lake City the next day.

Kearns had to stay around to count the proceeds. All in all, the fight grossed $80,000. After paying three federal tax agents their cut, Kearns went to the train depot carrying a suitcase full of cash.

When he was told there were no trains leaving the next day, he paid a stationmaster $500 to fire up a locomotive to take him to Great Falls.

Gibbons made no money for the fight, but he did receive a Vaudeville contract. He continued boxing until dropping a decision to eventual Dempsey conqueror Gene Tunney in 1925.

Dempsey, or course, had a few great fights afterwards. He followed up the Shelby debacle later that year with his barnburner against Luis Angel Firpo in a bout that produced eleven knockdowns in only three minutes and 57 seconds.

As for the town that only wanted a little publicity, “The City of Shelby did not have any funds invested in the fight and life went on as usual,” says Bonderud. “The closing of banks, etc., has been greatly exaggerated, and the community is alive and thriving today.”

The stories may have been embellished, but history shows that the banks did close. On July 9, the Stanton Trust & Savings Bank of Great Falls closed, followed by Mayor Johnson’s First State Bank of Shelby on July 10, and the First State Bank of Joplin on July 11. The First National Bank of Shelby went out of business on August 16, leaving the town without a bank.

In the ‘50s, a reporter told Kearns, “I hear you broke three banks with that one [Dempsey/Gibbons].”

“That’s a lie. A contemptible lie,” Kearns responded. “I didn’t break three banks with the Shelby fight. I broke four.”

The arena has long since been torn down, and in its place sits a Pizza Hut and a Dixie Inn. But as Mayor Bonderud said, the town has recovered and looks to take advantage of its infamous story. The city is working to build a Champions Park, which would be inspired by the original arena. The proposed centerpiece is two bronzed likenesses of Dempsey and Gibbons battling it out in the center. Mayor Bonderud hopes to have it finished for the fight’s 85th anniversary in 2008.

Who would have guessed that the infamously bad investment would finally yield dividends decades later?

“If the fight had been a great success, we would not be talking about it now,” says Bonderud. “So its financial failure then is now paying off today with the renewed interest in the fight. We are certainly attempting to capitalize on that now.”