Boxoffice (Apr-Jun 1939)

Hot Allied Executive Session On Trade Practice Code Minneapolis — Instead of being a session devoted to the voicing of individual complaints and grievances by independent exhibitors without producer distributors’ presence, the initial executive meeting of the Allied convention was given over to an analysis and exposition of the proposed industry and trade practice code. While arguments pro and con were taboo, being reserved for succeeding open forums, the tone of the discussion indicated anything but clear sailing for the proposed pact when a secret ballot is taken on its acceptance or rejection Thursday. Dissatisfaction with numerous clauses in the final draft, submitted just before the meeting convened, was voiced by Nathan Yamins and Sidney Samuelson who explained the document’s provisions. It was made plain that producer-distributors urging the pact’s adoption will have considerable opposition and that the hardest kind of fight will be necessary to obtain its acceptance by the independent exhibitors participating in the convention. If the independents accept the code, they were told, they will be by inference going on record that it constitutes a fair trade pact, cures industry ills and eliminates evils against which they have been fighting, despite the fact that it contains no provisions wiping out compulsory block booking, producer-distributor ownership and operation of theatres, blind selling and other allegedly unfair trade practices. "Says Will Be Binding" Acceptance of the code “will mean the exhibitors’ entry into a binding contract.” If Allied States after such acceptance attempted to secure legislative relief, “it would be confronted with the fact that it had signed an agreement as to what constitutes fair trade practices and it would be accused of being Bolsheviks and Reds,” Yamins asserted. Abram F. Myers, explaining the arbitration provided for, declared that “in the main — and barring certain particulars which are matters of detail, the arbitration system prepared by the distributors coincides with my draft submitted to them and is a fine one.” At the same time, however, Myers declared “it is perfectly obvious that no matter how fine and fair an arbitration system you have it will not mean anything unless the code provisions themselves are important, have some definite meaning and will have some pronounced effect on the industry’s trade practices.” “The question you exhibitors must resolve when you vote on acceptance or rejection,” continued Myers, “will have more to do with the code itself than with the arbitration system. “You also must decide if you wish to restore arbitration of contract disputes, whether it will net you anything or whether it will be just a cheap means for distributors to enforce contract terms against you.” The one fault found by Myers pertained to arbitration of clearance disputes. He said after distributors had declared they wanted to keep out of clearance disputes and he, taking them at their word, had framed a provision that omitted them from representation on the trial board, they now show a change of heart and the board’s setup represents a fundamental departure from his system, he said. In clearance disputes, assuming the involvement of an affiliated and an independent exhibitor, Myers pointed out, the arbitration board under the new setup would consist of one arbitrator appointed by each exhibitor (two in all), one appointed by the distributors and two neutrals. Thus, he said, the independent would have to gain the votes of both neutrals and the affiliated exhibitor only one in order to win, “making an unfair balance.” In conclusion, Myers reiterated that arbitration is only a court for the adjustment of exhibitor rights under the code and if the exhibitors have no such rights they will have a court without jurisdiction. “Your final decision must be based on what is given you to arbitrate,” said Myers. Samuelson asserted that the distributors actually have served notice on the federal government that the code represents everything independent exhibitors desire — that it removes all present injustices. "Curb Not Restrictive" Under the Samuelson and Yamins interpretations, it was declared that the code would not prohibit distributors from building theatres in opposition to independents, that guarantees could be made so high that it still would be necessary to give the distributors their desired preferred playing time, that distributors could continue to set up radio opposition to exhibitors, and that juggling of allocations — the withholding of exceptional pictures and substitution of inferior ones — still would be possible. It also was contended that under the code the buying of shorts still could be forced because any complaint against such action would have to be made within 48 hours while the distributors had 10 days to accept or to reject contracts. If a complaint were made, it was declared, the distributor could reject the contract for the features on the ground that the price was unsatisfactory. In case of overbuying, it was asserted, the code would not prevent the offending exhibitor from picking out the poorest pictures from his various products and turning them over to the injured competitor. A different measure of guilt for exhibitor and distributor, making it difficult for the former to obtain redress, was another code “fault” charged. “There were certain things the exhibitors’ committee was permitted to discuss and others we weren’t,” explained Yamins. “There isn’t 50 per cent of what we asked that has been granted.” Samuelson said he would defer to a later meeting an answer to the question of whether Allied States actually “had anything to do with the code’s preparation.” No Retrenchment on Legislative Program • Continued from page 19) tributors’ presence. Some said they were afraid they’d be set down as “trouble makers” and that it “would be taken out on them” when it came to buying film. Some wanted to employ an attorney to speak for them at the open forum, but Committee Chairman W. A. Steffes frowned upon that proposal. He declared such an outsider and the exhibitors lacking the “guts” to talk “would be kicked out of the convention.” “There never has been a greater opportunity for exhibitors to counsel with their leaders and with each other with respect to momentous decisions which they soon must make,” declared Abram F. Myers, general counsel and chairman of the Allied States board. “It is fitting that this great conclave should be under Allied States auspices, in view of the fact that the outstanding issue to be discussed is the code of fair trade practices proposed by the major distributors. Such conciliatory gestures on major interests’ part always have coincided with Allied’s outbursts of aggressiveness in independent exhibitors’ interest. Allied alone bore the brunt — and the cost — of these activities and in the midst of the battle had to bear with the carping criticism of those who claimed to have the same objectives and now stand to benefit by the outcome. We are proud that the issue will reach its climax at the Allied convention. "Thorough Analysis" “The distributors’ proposals will be thoroughly analyzed by those who represented Allied in the negotiations. The purpose will not be to influence anyone’s stand in the matter, but merely to insure a correct understanding of all that is involved. The proposal will be discussed by executives of the major distributing companies. Those on the floor will be encouraged to discuss it to their hearts content. Col. Cole’s reputation insures that fairness and impartiality will prevail at the sessions. Under these conditions they will be able to chart a course for the guidance of all.” There were two surprise developments at the convention’s start. One was the early arrival of Ed Kuykendall, MPTOA president, and his decision to participate. After promising Chairman Steffes to come he later announced he wouldn’t be present. However, he changed his mind a second time. Many Northwest Allied members were urging that arbitration be extended to cover film prices, but Rodgers made it clear that there would be no further revision. New Five-Year Loew Pact Is Signed by Rodgers New York — It is understood here that William F. Rodgers has signed a new five-year contract as general sales manager of Loew’s, Inc. His old contract expired about two weeks ago. 22 BOXOFFICE :: June 17, 1939