The Exhibitor (Nov 1938-May 1939)

11 THE NATIONAL Grand National Sets English Distribution Settles Deal with Fine Arts on Product Announcement that Grand National will set up its own distribution organization in England was made November 22 by E. W. Hammons, president, Grand National Pictures, Inc. The GN plans for operation in the United Kingdom also provide for the production by the company of its English quota pictures, which is expected to include about eight feature pictures for the first season. Said Hammons: "On my recent visit to London two or three offers were made to us for distribution in the United Kingdom. After giving all these proposals due consideration, we have decided it is best for us to establish our own distribution organization. The quota pictures which we are to make in England are not intended generally for distribution in the United States. Occasionally, one of these features may be designed and produced to have a world-wide appeal, or to have a special appeal for American use. Such pictures may be brought here for distribution. The others will not.” The new GN organization will handle both features, short subjects, will have exchanges in all the recognized exchange centers in the United Kingdom. One of the managing directors of the new company will be Edward R. Russell, now managing director of Educational Films Company, Ltd., who has been associated with Educational for 18 years. Purchase of substantially all the assets of Fine Arts Pictures, Inc., assumption of its production obligations under its contact with Grand National, by a newly organized producing corporation, was announced at the same time. The organization of the new company gives Grand National positive assurance that it will receive all the product which Fine Arts agreed to deliver. In addition the new company assures the production of at least two "top” pictures in this group, agrees to raise the production budget substantially on all future pictures. The agreement was concluded in a most amiable manner. GN will continue to distribute the three completed Fine Arts productions, will also release the new Fine Arts picture tentatively titled "The Long Shot.” General Talking Loses Important Patent Case Patent Decision Seen Important The Supreme Court rejected again last week the plea of the General Talking Pictures Corporation in a patent case which has attracted wide attention because of its bearing on the coming monopoly investigation by the government. Great interest was shown by the government in the case. When the rehearing was argued a month ago, Thurman Arnold, assistant attorney general in charge of the monopoly investigation, filed a brief to "protect the public interest.” He agreed fully with Justice Black’s dissent that the May ruling would mean a sweeping expansion of the boundaries fixed by Congress to "limit the scope and duration of patent monopolies.” The suit was by Talking Pictures against the Western Electric Research Products, Inc., divisions of the American Telephone and Telegraph Company. It contested a "license” restricting the us: of vacuum tube amplifiers solely to broadcast reception. Justice Bandeis said that the rehearing was granted because of two questions concerning restriction of use of patents after purchase, but that these questions were found to be relevant. Instead, h: stated, the question was whether a restrictive license was legal; he answered that it was. Justice Brandeis noted that the patent pool had issued licenses to the American Transformer Company to make the amplifiers, but stipulated that they be used only for broadcasting, not in motion picture machines leased to film theatres. He pointed out that the Transforme' company knew the terms of the license, but nevertheless made the amplifiers for the prohibited use, sold them to Pictures Corporation. The Transformer company, he added, was "guilty of infringement. Pathe Film Taking a Vote on Liquidation Financial Plan Sent to Stockholders Pathe Film Corporation faces its eventual liquidation, it was indicated this week following announcement of a plan sent to the SEC, stockholders. Directors are expected to buy the Bound Brook, New Jersey, laboratory, together with the film business for about half a million dollars. Under the plan, five year debentures, with cash $200,000 would be made as payment. Debentures would be paid at 20 per cent a year from profits. Th: DuPont stock owned by the company would be given to the bank as collateral for a $1,000,000 loan used to retire th: preferred stock. Any assets from sale of stock in Monogram as well as RKO notes would be distributed pro rata among the stockholders, with this distribution depending on what proportion of bank loan would be assumed by the stockholders. Approval must be voted by stockholders, directors. U. S. Judge Dismisses Ashcraft-Balto. Suit Court Molds 12 Patent Claims Are Invalid A technical suit in which the entire industry was interested ended last week when Judge William C. Coleman, Federal District Court of Maryland, in Baltimore, dismissed the suit brought by Harry C. Ashcraft, Ashcraft Manufacturing Company, against the Grand, Baltimore, Maryland; the National Theatre Supply Company. According to his opinion, decision, two paragraphs read as follows: "In conclusion, the Court finds that all 12 claims of the patent in suit are invalid for anticipation, and, therefore, the bill of complaint must be dismissed. A decree will be signed in accordance with this opinion.” Allied Making Drive for Financial Backing Allied States Association of Motion Picture Exhibitors is making a drive for funds to aid its current program, letters sent to the trade within the last two weeks have revealed. November )0, 19)8 ON YOUR DESK EVERY WEDNESDAY TRI