Many of the events in the movie were based upon real events, according to the DVD production notes. These include the "Bloody Christmas" scene where drunken police officers brutally beat up Hispanic prisoners suspected of beating up two uniformed cops; the plot line of real-life gangster Mickey Cohen's arrest touching off a gang war for control of the rackets; the LAPD "Goon Squad" which would kidnap out-of-town gangsters, beat them up and threaten to kill them if they ever tried to come back to set up their operations; Lana Turner dating gangster Johnny Stompanato. In real life, Turner's daughter Cheryl Crane stabbed Stompanato to death after catching him beating her mother.
Mickey Cohen, the mobster who gets locked up and thereby causes the war for control of the drug trade in the story, was a real-life Los Angeles mobster in the late '30s and early '40s. He was a small-time hood who joined forces with New York gangster Bugsy Siegel when Siegel came out to L.A. to run the rackets (see the film Bugsy (1991)). After Siegel's murder in 1947, Cohen took over the rackets that Bugsy had built up, including studio labor union shakedowns, drug trafficking, gambling and prostitution. He was so hated by the police that he was constantly arrested for any crime, big or small (he was once busted for using foul language on the street!). As shown in the movie, he was eventually locked up for income tax evasion and spent nearly ten years in prison. After his release, he was semi-retired from the rackets and lived off his wealth, remaining a colorful character in Los Angeles until his death in 1976.