The Film Daily (1940)

Monday, June 10, V. Move for Settlement Of Equity Action (Continued from Fage 1) and discussicn of the terms by the attorney general's office when on Friday morning Federal Judge Henry W. Goddard granted a recess of the trial until today. Application for the delay in the start of presentation of testimony by the Government was made by Special Assistant Attorney General John S. Clagett who said merely that the prosecution required additional time before introducing evidence. No defense attorneys were present. Consent Decree "in the Wind" Judge Goddard asserted smilingly from the bench that the postponement was for the purpose of counsel preparing stipulations "and other matters." The latter phrase was immediately interpreted by those who have been following developments in the case closely to mean that a consent decree was "in the wind." Corroboration of this followed shortly when D of J channels told The Film Daily that the confabs between major company counsel and Special Assistant Attorney General Paul Williams, together with the latter's aides, had brought about tentative agreement on every important point of issue. The tentative agreement was described as the culmination of all the conferences which had been held between the Government and the defendants in recent weeks on the issue of a mutually satisfactory settlement. Williams asserted: "I hope something constructive will come of all this." Divorcement May Be Hurdled While there was reluctance on the part of both the D of J and the majors to discuss the agreement in principle because of its preliminary nature, plus the fact that official approval must come from Washington on the basic terms, and the angle that revision of these to some extent is expected, nevertheless it was learned that the vital question of theater divorcement will in all likelihood be successfully hurdled by the majors, with latter retaining their circuits under certain stipulations. Modifications are looked for in the matters of block-booking and blindselling, it was hinted, probably along the lines suggested by the Department of Commerce in its consent decree draft. Perhaps the most encouraging note in the petitioner-defendant huddle was the spirit shown on the part of all conferees to iron out difficulties which might interfere with a settlement satisfactory to everyone concerned in the action. Fui'ther, it is noteworthy that optimism prevails on the score of eventually arriving at a workable trade practice code, which, it is expected, will doubtless emerge after the settlement has been effected. Might Kill Other Trust Suits Another advantage to the industry in the plans for settlement will be THE WEEr IN REVIEW Equity Trial Under Way — Neely Bill Substitute By L. H. MITCHELL DOMESTIC EQUITY SUIT: Trial of the Gov't's equity suit against the majors got under way Monday, with Paul Williams making opening statement for the Gov't and Judge Thomas D. Thacher for the defense . . . Thurman Arnold charged the "Big Eight" with monopolistic waste . . . Thacher asserted suit was a "class action" brought in the interest of competing theaters . . . Paul Williams admitted it was okay for distribs. to show their own pix in affiliated theaters but not those of other distribs . . . Judge Joseph Proskauer, Warner counsel, told the court Warner Bros, had to acquire theaters for installation of sound equipment "or else." * .* * NEELY BILL: As week neared end, word came from Washington that the Neely anti-block-booking bill was dead, and that, to avoid an unfavorable report, a sub-committee was appointed to draft a substitute bill and perhaps salvage something from Neely's measure. House Interstate and Foreign Commerce Committeemen were reported as having found nothing of "moral value" in the bill . . . Austin C. Keough (Para.), in attacking the bill, called it a blackmail instrument, while George J. Schaefer (RKO) asserted it would create a flock of "little fuehrers" . . .Abram F. Myers' plea in behalf of the bill ended the hearing. * * * COLUMBIA: At Columbia's Chicago sales meeting it was disclosed that 16 of the company's 44 pix for the new season would get top budgets . . . Abe Montague, sales chief, asserted Columbia had its own code and would stand by it, continue to sell it to exhibs. He also appealed for exhib. co-operation with producer-distribs. LESSER HIGHLIGHTS: Possibility that Gov't would extend admish tax to 1946 seen as almost certain . . . WB will use GWTW policy with ATAHT, planning a $300,000 campaign for the film . . . Joseph M. Schenck, indicted on a charge of income tax evasion, asserted charges were unfair, that his accountants assured him that, if anything, he had overpaid . . . lATSE at St. Louis meeting charged Thurman Arnold with seeking to destroy organized labor; goal of the organization was seen as 100 per cent unionization here. Also intimation was given that lA might decide on union move in the television field . . . Universal's second quarter net neared the million mark— $920,370, with profits for the first half year at $1,381,002. . . . Harry M. Warner, addressing Coast employes, urged industry to fight the "Fifth Column." He asserted there was no place in his organization for Bundsman, Fascist or Communists . . . Nine plays bought for the screen cost producers $1,050,000. . . Spyros Skouras, addressing Ampa, urged a "moral merger" of the film industry. PRODUCTION: Four studios started six pix during the week. At RKO, "Stranger on the Third Floor"; at 20th-Fox, "The Great Profile" with John Barrymore; "U" put two into work "Margie" and "Arizona Cyclone"; Republic also started two, "Sing, Dance, Plenty Hot" and "The Ranger and the Lady" . . . Paulette Goddard gets leading femme role in Cecil B. DeMille's next, "Reap the Wild Wind" . . . Ann Sothern and Ian Hunter head M-G-M cast for "Dulcy" remake. . . Irving Applebaum Prods. will make "Music Camp" . . . RKO signs Fay Wray for "Wildcat Bus." Richard Carlson gets male lead in RKO's "Too Many Girls" . . . 20thFox assigns Tyrone Power to "The Californian" . . . Metro casts James Stewart with Katharine Hepburn in "Philadelphia Story," and may assign Fredric March to the cast. that it will be enabled to rid itself of other D of J anti-trust actions currently confronted in various sections of the U. S. Today's equity action hearing in Federal Court here will be further deferred to Wednesday, and subsequently further deferments will be taken, depending upon the length of time it takes D of J officials in Washington to come to a decision on the suggested terms of settlement. Authoritative circles asserted at the week-end that initiative was actually taken by the Government in a spirit of helpful conciliation to forestall the case going to trial, when an agreement, before testimony began, was possible. This obviously was with an eye upon the much disI cussed Section 5 of the Clayton Act. Gov't Subpoenaes Two More Equity Witnesses The Government Friday subpoenaed two more witnesses despite the proposed discussions for a consent decree in the equity suit. George Wharton Pepper, former U. S. Senator from Pennsylvania, and John J. Gain were subpoenaed to testify if the trial resumes. Pepper was ordered to produce books, contracts and clearance schedules received by him from Columbus Stamper, a Government witness from Philadelphia, relative to the latter's eight theaters. Gain is to produce lists and records which identify persons owning bonds secured by the Cai-men in Philadelphia. By agreement, Samuel Goldwyn will not be asked to testify until next Fall. SIcouras Plea Gets Sears' Endorsement (Continued from Page 1) industry matters at the Ampa I cheon Thursday, calling them "most constructive pronouncem made in years by any leader in amusement field." Agreeing with Skouras' ai/^ of the admission price siti Sears asserted that there must reasonably higher prices to prol -he producer, distributor and hibitor in the present critical sit tion. "If the highest quality in prod ion is to be kept up, there must sufficient revenue to pay the b and insure a fair profit," Sears s; "There is no doubt in my mind t the public wants high-grade en tainment and is going to insist it. Nor do I doubt for a mom that the public is willing to pa fair price for it." Sears said that was why Warr planned a roadshow and special gagement policy for ATAHT. "We are all in the same bo Sears said, in agreeing with St ras' contention that a close-knit practical program of co-opera was urgently needed. "It is a n ter of bread and butter for us solve the problems that conft us," he added. Skouras' assertion that there • no longer such a thing as comp tion did not meet with Sears' liefs. There is and must be competi' but it should be intelligent, : sighted and generous competit Sears said. "We can and should to set the pace for each other in things that build up the industr good pictures, effective distribut attractive presentation, etc. Buf a family, there are matters on wi we should stand firmly togethei the interests of all concerned. "I believe these facts are be realized throughout all branches the trade and that we are going solve our problems in the sp which found expression in Mr. S\i ras' address. Let's all hang gether, as Benjamin Franklin s or else — ." Threat of Veto Wins Sign Ordinance Hearing Detroit — Detroit theaters go. reprieve on the oi'dinance banni red or flashing signs within 22 : of a sidewalk, when Mayor Edw: J. Jeffries threatened to veto I bill unless the Council granteo public hearing. Move was madei United Detroit Theaters, Allied Tjl aters, and Co-operative Theati jointly. '■ Some 200 houses would have pay an average of $2,000 each, ci total of $400,000 to change si|; and fronts under the new law, |l cording to estimates of owners.'