Boxoffice (Jul-Sep 1939)

U. S. WOULD CRUSH CHAIN BUYING AND OPEN MARKET WIDE ON A 'HIGHEST BIDDER' BASIS Will Demand More Data on July 27 Oklahoma City — With the filing Wednesday of answers by the Griffith circuit and major defendants in the government monopoly suit, demands for further particulars will be heard July 27 before Judge Edgar Vaught. Distributors are represented by local counsel, while Charles E. Dierker, assistant to the attorney general, will handle the government’s side of the case. Dierker recently returned from Washington where he received instructions by Thurman Arnold to speed up the case, bearing out Boxofftce’s recent exclusive story the department of justice will bear down on the Griffiths’ case as a test for the all-industry action, which from present indications is not expected to reach the New York federal court calender until the early part of 1940. Preliminaries in the Griffiths’ suit are expected to take several more weeks with actual trial probably getting under way in the fall when attorneys from the major company home offices will sit in on the proceedings, supplementing local counsel. As in the case of the all-industry suit, the majors contend the petition is vague as to many of the allegations and definitions and clarification is sought before trial. RKO Escapes Involvement In Baltimore Trust Action Baltimore — RKO is the only major distributor not involved in the anti-trust suit filed by Leo Homand, vice-president of Westway Theatre, through his attorney, Edgar Allan Poe. The Lyndhurst Theatre Corp., Frank H. Durkee, C. Elmer Nolte sr., Walter Pacy and Harry Reddish are co-defendants. The suit charges restraint of trade in that the Edgewood Theatre, Durkee house, has been getting 14 days’ protection over the Westway. A temporal^ injunction also is sought. Arnold Checks Into Third Runs in Kentucky Checkup New York — The department of justice, in a formal complaint, is inquiring of six major distributors why they are “unable or unwilling’’ to license the New Theatre, Frankfort, Ky., with third run product for 1938-39. In a letter over the signature of Thurman Arnold to Paramount, 20th CenturyFox, Warner, UA, M-G-M and RKO, a request is made that the distributors state whether first and second-run product not used by Sam Lee, operator of the Capitol, (Continued on page 8) Independents Not Exempt Where Government Sees Grounds for Action Washington — Elimination of chain buying, whether by major circuits or independents, is one of the important goals of the department of justice in the allindustry suit now pending in New York and the proposed actions to be filed in the near future, it is learned from authentic sources close to the department. Tlie government’s aim is to compel distributors to sell on a local competitive basis with each man having the right to bid for product in an open and untrammeled market rather than through collective buying power developed by building and acquisitions. Where there is a sufficient cause of action the department does not hesitate to make known it will file monopolistic charges against independents. Large independent circuits frequently have been described as much, if not more, of a detriment to the small operator than the affiliated houses. An improvement of product with a resultant decrease in production costs must come if the government is successful in its prosecutions, these sources contend. However, nothing is said about a large independent theatre in a town competing for the same product with another large house, which automatically would soar rentals and which, in turn, might be bulked into higher production costs and thus decrease the number of pictures to be made annually. But primarily, a main objective of the government is to bring about a local competitive situation where all exhibitors may freely bid for the same product without being relegated to later runs if there is the wherewithal to pay for good pictures. Distributors Attorney in Vermont Suit to N. Y, New York — Guy Page, Burlington, Vt., attorney who has been retained by major distributors to represent them locally in the anti-trust action brought by Tegu’s Palace of St. Johnsbury, Vt., has been here conferring with distributor counsel. In Agreement on This One New York — The government has a definition for “shooting gallery.’' It's one of the few explanations of trade terms that distributors admit. According to the department of justice, a “shooting gallery" is a poorly equipped motion picture theatre. 431 Houses in 18 States for Warner New York — Warner and its subsidiaries operate 431 theatres in 18 states, Pennsylvania being the state with the largest holdings, the company reveals in its answer to the government’s all-industry suit. New Jersey is second, Connecticut, third, and Ohio, fourth. The states and number of theatres in each of them follow: California 11 Connecticut 33 Delaware 6 Illinois 16 Indiana 2 Maryland 9 Massachusetts 15 New Jersey 64 New York 28 Ohio 32 Oregon 2 Pennsylvania 158 Tennessee i Virginia 8 Washington, D. C 19 Washington 3 West Virginia lO Wisconsin 14 Total 431 An "Immediate Hearing" Is Government's Desire New York — Paul Williams, in charge of the government’s all-industry suit, is due Monday from Washington to confer with Senior Federal Judge John C. Knox on the possibility of moving the trial up on the "immediate hearing’’ calendar. Under regular court procedure, the government cannot seek preference until 20 days after the respondents have filed answers. The time limit ended Tuesday night and on the following day notices of the government’s intentions were sent out to all film company attorneys who had until Saturday to answer. This being a slow day, the matter has been put over until Monday when arguments are expected to be heard before Judge Knox. English Trade Benevolent Fund Seeks Stars' Aid London — “Mick” Hyams, theatre controller of Gaumont Super Cinemas, arrives in New York on the Champlain July 26 to enlist the services of a group of Hollywood stars for appearances at a gala performance to aid the Cinematograph Ti-ade Benevolent Fund to be held this fall at the Gaumont State, Kilburn. 4 BOXOFFICE : : July 22, 1939