Boxoffice (Apr-Jun 1939)

GOV'T GRADUALLY DIVULGES BACKGROUND FOR ITS SUIT; "COERCIONS" NAMED ONLY A START Texas Up Front With 18 Government Permitted to Withhold Aces Until 30 Days of Trial New York — The 55 alleged acts of coercion, involving 93 theatres in 60 cities and towns in 23 states so far listed by the government against four majors, are understood to represent a mere beginning in the department of justice’s ammunition train now moving against the industry. Who the exhibitors are, their theatres, approximate time and basis for the complaints constitute part of the information the defendant companies have been seeking in order to prepare their case. A federal court order a few days back compelled the government to furnish the detail, but it did not restrict federal attorneys to divulge all they may be holding up their sleeves. Where complaining exhibitors have no objections to divulgement of their names, the data is available, but where information percolating through to government investigators was provided on the understanding the source will be kept dark until trial, the government is permitted to withhold any aces in its possession up to 30 days before the case comes to trial. Few From East Although FBI men have spent months touring the eastern territory and the far west, only a handful of complaints from those areas are noted in the list furnished by the government. Seymour Krieger, Ralph Butterworth and other FBI agents some time ago investigated numerous complaints and interviewed independent exhibitors in Greater New York, upstate New York, Pennsylvania and New England. Only three California cases are mentioned, yet Albert Law and a host of assistants have been in Los Angeles and San Francisco for more than two and a half years checking into distributor and FWC records. Only one Los Angeles case is recorded. Massachusetts, Vermont, Connecticut, Rhode Island are conspicuously absent, despite the fact Allied has several units operating in the territories. In the New York metropolitan area, two complaints are noted against the RKO circuit and in Middletown, Paramount is cited in the Edward Quittner suit tried by the courts several years ago. Loew’s is not mentioned once. Neither is its producing-distributing affiliate, M-G-M. Four other majors are variously named, Paramount in 43 instances, 20th Century-Fox in six; RKO and Warner each three times. Several exhibitors, in addition to Quittner, who have appeared in the limelight of the past because of legal suits against distributors again crop up, this time as New York — Texas, with 18, leads the procession in number of cities and towns in which the government alleges the majors have coerced independent exhibitors. The array indicates how widespread the department of justice has been conducting its probings with others expected to be cited if and when trial of the all-industry anti-trust suit approaches. The states, the total of cities and towns and their names follow: Alabama (3) — Florence, Huntsville and Jasper. Arkansas (2) — Little Rock and Russellville. California (3) — Compton, Los Angeles and Pomona. Florida (3) — Jacksonville, Lakeland and Tampa. Georgia (2) — Atlanta and Gainesville. Illinois (3) — Chicago, Decatur and Oak Park. Indiana (3) — Anderson, Gary and South Bend. part of the government’s case. They include H. L. Gumbiner of the Tower, Los Angeles, with 20th Century-Fox named as the producer-exhibitor, V. U. Young of Anderson and Gary, Ind., is mentioned twice with Paramount as the cause for complaint, William N. Youngclaus, Columbus, Neb., appears because of his alleged “forced” sale in 1935 of the Swan to Central States Theatres Corp. Indicating how far-flung the department of justice checkup is proceeding is the detailed breakdown appearing in the government’s amended bill of particulars. Listed are the theatre or theatres cited, and where located, the exhibitor by name, approximate time of the “coercion” and what, in the government’s presentation, the complaint comprises: PARAMOUNT PICTURES, INC. Colonial and New, Jasper, Ala.; Joe and John Johnson; 1933-35. Independent exhibitors were forced to sell their theatres because of threats to open and operate opposition theatres; and because of threats to deprive and because they were actually deprived of desired product. New, Russellville, Ark.; R. V. McGinnis; 1936. Independent exhibitor was forced to sell his theatre because of discriminatory film rentals and forced block booking as well as forcing of short subjects and news reels. Arkansas, Little Rock, Ark.; Andy McNeil, Dwight H. Blackwood, Eugene T. Oliver, manager; 1933. Owners of the theatre were forced to sell inasmuch as they were deprived of sufficient and desirable product. Lakeland, Lakeland, Fla.; Harry Bott; 1937. Refusal of distributors to license pictures for exhibition in theatre. A week after the Lakeland was opened by independent exhibitor, a competing theatre operated by a Paramount affiliate cut its admission prices. About a week later the Paramount affiliate reopened an old theatre and began double featuring at its better house with the reduced admission price. Independent exhibitor was forced to close his Iowa (3) — Algona, Marshalltown and Sioux City. Louisiana (1) — New Iberia. Maine (1) — Gardner. Maryland (1) — Silver Spring. Minnesota (1) — North Mankato. Missouri (1) — Kansas City. Nebraska (2) — Columbus and Lincoln. New York (3) — Brooklyn, Merrick (Long Island) and Middletown. Ohio (2) — Canton and Marion. Oklahoma (1) — McAlester. South Carolina (1) — Greenville. South Dakota (1) — Watertown. Tennessee (1) — Columbia. Texas (18) — Austin, Beaumont, Bryan, Conroe, Dallas, Fort Worth, Galveston, Greenville, Henderson, Houston, Jacksonville, Marshall, Nacogdoches, Port Arthur, Ranger, Sequin, Tyler and Waco. West Virginia (1) — Wheeling. Wisconsin (3) — Delavan, Lake Geneva and Milwaukee. theatre and take a substantial loss on his investment. The theatre was taken over by the insurance company holding a mortgage on it. Auditorium, Lakeland, Fla.; L. D. Joel; 1919. Independent exhibitor was forced to sell his theatre because of threats to open and the actual opening and operation of an opposition theatre and because he was deprived of desired product. Rivoli, Tampa, Fla.; N. V. Darley; 1931. Threats by representative of Paramount affiliate that the Rivoli would be unable to procure product followed by the refusal of the distributors to license pictures to the Rivoli because the pictures had been tied up by the Paramount affiliate. Gordon, Atlanta, Ga. ; Claude D. Swint; 1934. Independent exhibitor planned to construct the theatre and the distributors assured him he could get pictures. He started construction of his theatre on land he had leased. After his theatre was partly constructed the distributors advised independent exhibitor that a Paramount affiliate had decided to build a theatre within 250 feet of his theatre and he knew that the new theatre of the Paramount affiliate would be given pictures before he could exhibit them. As a result, independent exhibitor was forced to cease the construction of his theatre with a cash loss of $2,825. Alamo, Gainesville, Ga. ; Mary Cinciolo; 19191920. Independent exhibitor was forced to sell her theatre because of threats to build and operate opposition theatre and because of threats to deprive her of desired product. Lake. Oak Park, 111.; Greater Chicago Theatres Corporation; 1935. The independent exhibitor was deprived of desirable product and arbitrary and unreasonable clearance was imposed upon it. Palace, Gary, Ind.; Palace, Canton, Ohio; Palace, Marion, Ohio; Marion, Marion, Ohio, and all other Indiana theatres operated in 1929 by Verner U. Young or corporations in which he had interests. Threats to spend $60,000,000 to eliminate independent exhibitors in Indiana. State, South Bend, Ind.; Theatrical Managers, Inc.; 1933 and 1934. Threats to oppose independent exhibitor by acquiring theatres in Gary, Ind., and in the other Indiana situations where independent exhibitor operated. State, Algona, Iowa; Gail L. Pettit; 1935-1937. Independent exhibitor was forced to sell his (Continued on page 19) BOXOFFICE :: June 3, 1939 5