Independent Exhibitors Film Bulletin (Sep 1935 - Aug 1936)

WEDNESDAY, FEBRUARY 26, 1936 5 Gov't Reopens Anti-Trust Case Against 3 Majors In N. Y. Court FAR REACHING ACTION INCLUDING WB, RKO, PARA AND 40 EXECUTIVES IS BASED ON SUSPENDED ST. L. CASE Resuming its attacks on alleged monopolistic practices in St. Louis by Warner Bros., RKO and Paramount, the Department of Justice instituted in New York Federal Court an anti-trust action against the three companies and many of their executives that has far broader implications than the original suit. While the new action is presumably based on the abuses charged in St. Louis, the Government's petition is so drawn up as to enable it to bring in similar complaints from other parts of the country. Reference is made, for instance, to the Roxy, N. Y., the management of which claimed, during the St. Louis equity hearing, that they were unable to obtain adequate product. INJUNCTIONS SOUGHT . . . The petition applies for a preliminary injunction restraining the defendant companies from continuing their alleged violations of the Sherman Anti-Trust law and, after the hearing, a permanent injunction in this specific case and a court order to the defendants to discontinue their general practices in restraint of trade through contracts, combinations and conspiracies. Ten companies and thirty officials are named in the suit. In addition to the three main companies, the seven subsidiary corporations are Vitaphone Corp.; Vitagraph, Inc.; First National Pictures, Inc.; Warner Bros. Circuit Management Corp.; General Theatrical Enterprises, Inc.; Paramount Pictures Distributing Corp.; Paramount Theatre Service Corp. 30 INDIVIDUALS . . . Heading the group of thirty individuals named in the petition are: Harry M. Warner, Albert M. Warner, Herman Starr, Adolph Zukor, John E. Otterson and Ned E. Depinet. Following in the list of other executives and employees of the three film companies, whose names appear in the petition as codefendants: Warner Bros.: Abel Carey Thomas, Gradwell Sears, Joseph Bernhard, Maurice Silver, Clayton Bond, Andy W. Smith, Lester Kriegcr, Roy Haines, N. H. Brower, Robert Hicks and Byron F. Moore; Paramount: George J. Schaefer, Neil F. Agnew, Charles M. Reagan, Ralph Kohn, Sam Dembow (now with National Screen), Ralph LeBeau, Maurice Schweitzer, Carroll Peacock and Mike Lewis; RKO: Jules Levy, Cresson E. Smith, B. J. McCarthy and Louis Ellman. $700,000-000 ASSETS . . . The complaint points out that the three major companies own assets totalling $767,237,63 8 and have 1,811 theatres under their control. They produce 46 percent of the important film supply made in this country on the basis of figures computed from their 1935-36 schedules. The allegation that the three companies conspired to "freeze out" the Fanchon & Marco interests, who took over the Ambassador, Missouri and Grand Central Theatres in St. Louis after Warner lost the houses through rent defaults, is reviewed and Warners are charged with having threatened to compete with F & M in a "malicious and unfair manner" in order to force them out of the theatres. SENATE COMMITTEE HEARS ARGUMENTS ON BLOCK BOOKING MEASURE THURSDAY MAY BE JOINT HEARING . . . Washington, February 2 5. — Emissaries of the major producers and independent exhibitors are converging on this capitol city to lend their voices, pro and con, on the subject of the Pettengill-Neely Bill to outlaw compulsory block blind booking. Ed Kuykcndall, head of the MPTOA, David Palfreyman and Charles C. Pettijohn will be the principal representatives of the Hays organization and will present the usual arguements in favor of the present selling system, while approximately 2 5 independents, most of them members of various Eastern Ail ed units, are expected to attend in support of the bill. The House sub-committee may decide to hold its hearing jointly with the Senate group, it was learned today. Senator Neely of West Virginia is chairman of the upper branch committee and Representative Pettengill of Indiana heads the House sub-committee. The hearing gets under way 10.30 A.M. Thursdav. ALLIED CONVENTION IN CLEVE. JUNE 2-4 TERMS CHIEF TOPIC . . . The annual convention of national Allied States Ass'n will be held at the Hollenden Hotel, Cleveland, on Tuesday, Wednesday and Thursday, June 2-3-4, it was announced by H. M. Richey, general convention chairman and leader of the Michigan unit of the organization. Timed to come at a time when most film companies will have revealed their terms for the 1936-37 season, the meeting will be in position to analyze the deals being offered and advise their members on them. The discussion on block booking will largely be determined by the action of Congress on the pending Pettengill-Neely bill. Allied leaders are optimistic that this year's conclave will be the most successful in the body's history and point to the 193 5 meeting in Atlanta, which was attended far in excess of their expectations. The advantageous location of the forthcoming convention is expected to bring an even larger turnout. Golder Due Back Next Week; Inquiry To Start Benjamin M. Golder, Philadelphia attorney recently appointed "friend of the court" by Federal Judge Welsh to investigate the block booking system and other alleged monopolistic practices by the majors, is due back from his vacation in Palm Beach next week and will plunge into his job promptly upon his return. Mr. Golder has been in touch w ith his office several times since he reached Florida and has issued instructions for preparations to enable him to get the inquiry under way without loss of time. He will probably issue a formal statement shortly after he arrives at his office.