The Film Daily (1945)

"uesday, October 9, 1945 cW DAILY Says No Co. Powerful Enough for Gov't Purpose Sov't Had to Lump Co.s "o Get Divorcement 2ase, Seymour Claims i Continued from Page 1) rid that he would demand that each ompany, be judged alone. jFollowing the opening statement L Robert L. Wright, trial lawyer or the Government, attorneys for hree of the defendant distributors -Paramount, 20th Century-Fox and oew's — gave their opening statelents in which they denied allega OPPOSING VIEWS AT EQUITY TRIAL i Continued from Page 11 Davis Asserts Defense Can Get No Clear-cut Statement of Gov't Charges Washingtcm Bur., THE FILM DAILY Washington — The United States Supreme Court at Washington yesterday refused to hear the motion oj the St. Louis Amusement Co., et al, to intervene in the Federal Government anti-trust case agaijist the majors in the equity suit in the Southern Neiv York Federal Court. ions of monopoly and asserted that ach of the companies was in keen ompetition with the other. The trial opened at 10:32 A. M. t the outset, Harold J. Sherman, epresenting the American Civil liberties Union, petitioned the court or permission to intervene in the rial. The court — Judges Augustus land, Henry W. Goddard and John (right — reserved decision. Wright Reviews the Case Wright then stated the Government's case and reviewed the action rom its beginning. With the use of hares showing the schedule of runs n two pictures in New York, Philaelphia, Kansas City and Atlanta, Yright pointed out how clearances nd film rentals compared from the n'st-runs down to the last subsequent-runs. He said a survey had een made by Department of Justice gents in 500 cities and towns in i'hich the defendants operated and hat he expected to show that each f the companies had violated the iherman Act and that the "Big ive" were guilty of price-fixing. He. aid he hoped the divorcement issue ould be disposed of as quickly as ossible. Judge Hand asked Wright who suf or edification pictures are produced. It is based solely on the relatively unimportant segment of theater competitors of the theater-owning defendants who would like to see these defendants out of exhibition competition." JOHN W. DAVIS For Loew's, Inc. "I will demand proof of monopoly in each of the 73 towns which the Government claims the companies have control of prior runs." "The Government has a hobby and intends to ride it to the end." OJEDDIHG BELLS Mundy-Cranston Kansas City — Shirley Mundy, secetary to Tom Baldwin, Columbia jranch manager here, was married :o Everett Cranston, Navy air cadet jtudent at William Jewell College jit nearby Liberty. Caplcm-Mangen Mildred Caplan, secretary at the Loew Poli division office, New Haven, announces her engagement to Arnold Mangen, recently discharged from ;erviee. Wedding will be Dec. 23. JOHN CASKEY For 20th Century-Fox "The fact that 20th Century-Fox licenses its pictures to other defendants and that National Theaters exhibits the pictures of other defendants is no evidence of combination." "When the film rental for a picture is to be determined by a percentage of the theater's gross receipts, the distributor is clearly justified in bargaining with the exhibitor whether those receipts shall be measured by an admission price of at least 25 cents, 40 cents or 50 cents." fered if a picture did not get a downtown first-run. Wright replied that the distributor suffered, but that in Philadelphia Warner Bros, had no problem because of its control. "Do you mean," Judge Hand asked, "that an independent distributor can't get a picture into a downtown first-run in Philadelphia?" "Only if Warner Bros, wants it," Wright replied. Charges First-Run "Agreement" Wright further charged that firstruns were determined by the distributors "in agreement." Whitney North Seymour, trial attorney for Paramount, followed Wright with the reading of a 51-page opening statement in which he sought to break down the Government's charges. Seymour dealt first with the issue of clearance, pointing out that clearance was peculiar to this industry and that the consent decree recognized clearance as being essential. Yet, he continued, the Government relies heavily upon clearance, not simply unreasonable clearance, but all clearance granted to affiliated theaters, to bolster its claim of nation-wide monopsly of exhibition." "Reasonable Clearance" Essential At one point the court asked Wright what the Government's position on clearance was. Wright said he conceded that "reasonable clearance" was essential. The court then asked if he thought the appeal board had done a good job in rendering decisions, to which Wright replied that the appeal board had 'done well," but that it was limited by the provisions of the consent decree. Switching to the subject of divorcement, Seymour said that the Government was asking the court to direct that Paramount dispose of its investments in exhibition companies carried on the company's books at more than $63,000,000." Holds Gov't Charge "Weak" "The sole basis of this severe and perhaps fatal amputation is a claim that the defendants which have an interest in motion picture theaters have combined and conspired to monopolize the domestic motion picture market," Seymour said. "This claim is not based upon any assertion of an agreement or conspiracy made at any particular time by any of these defendants." Seymour pointed out that "by taking the largest and most successful producers, who also own interests in the theaters, the Government isolates large units for attack but, since none alone is large enough, or powerful enough, for its purposes, they ?.re arbitrarily lumped together and then their separate and independent operations are submitted to statistical analysis of dubious quality as if they were all one." Seymour added that "this is the fatal weakness in the Government's case." He went on to say that "when this case is over, the court will be completely satisfied that the defendants' operations are independently conducted under conditions of most vigorous competition from the beginning of production to the last exhibition." Seymour concluded that "it is Paramount's position that there is and has been no combination or conspiracy to monopolize" and that the Government's proofs would fail completely to show law violation. Issues Not Clarified Davis, who followed Seymour, said that the defendants had tried to get a clear-cut statement of what they were charged with and that the issues still were not clarified. He asserted that the "statistical monopoly" charges of the Government could be true of all industries if their outputs and revenues were added together, but as individual companies there was no basis for the allegations. He pointed out that Loew's had joint ownership in only three cities, and yet it was charged with monopoly. Of the 17,500 theaters in the United States, Loew's had 129. Seymour had said that Paramount had interest in less than 1,600 theaters or about nine percent of the total. Davis said he would like to have the Government prove that the defendants were drawn together for any other reason than a "common danger" and that because the charges did not fit the companies individually, they should be judged alone and that the situation in each city be investigated separately. Denies Profit Sharing John Caskey was the final attorney of the day to speak. Representing 20th Century-Fox, Caskey gave a review of the history of the Fox organization and the acquisition of National Theaters. He denied charges of monopoly in production and distribution and said that the plaintiff's claims of profit-sharing arrangements had no factual support. Davis, during his statement, said that when the Government completes its side of the case, he may move for dismissal, based on alleged lack of evidence. It was indicated that the Government may complete its side in a week, although there were some opinions expressed that a longer time would be required. As to the length of the whole trial, the concensus was that 10 weeks would be ! the minimum. On the Floor Today First to take the floor this morning will be George Leisure, representing RKO, and he will be followed by Joseph M. Proskauer for Warner Bros., Louis Frohlich, for Columbia, or Edward Raftery for United Artists will be the next to make opening statements. The big court room on the first floor of the United States Court House was filled almost to capacity as the trial opened. Every company was represented with legal talent, while there were observers from all branches. For MPTOA was Herman Levy. For Allied were Abraham F. Myers, Sidney Samuelson, Roy Herrold and Jesse Stern, the latter representing all independents. Al Steffes was present for part of the proceedings. The trial continues at 10:30 o'clock this morning. Now It Can Be Told Dept. Arthur Mayer was one of the original passengers on the "Globester," first ATC plane to establish a roundthe-world" route. Mayer, assistant to Basil O'Connor, national chairman of the American Red Cross, is off to Calcutta, Shanghai, Manila, and Tokyo for the dual purpose of making films of ARC services in the Far East and inspect Red Cross installations. HOUSE DEALS Hall Sells to Wolf Elkader, la. — Don Wolf has taken over the management of the Elkader Theater at Elkader with H. H. Hall, the owner, returning to his investment business. Wolf, former owner of the Plaza Theater at Monona, recently received a honorable discharge from the Army.