The Film Daily (1940)

9$ DAILY Wednesday, August 7, Proposed Decree Sets Arbitration Neutral Arbitrators No Industry Background Provided in Machinery (Continued from Page 5) otherwise than by a separate contract or agreement which shall not be a part of any contract or agreement for the licensing of features to any other theater or conditioned upon the licensing of features for exhibition in any other theater. Proceedings Subsequent to Award After a final award has been made in favor of a complaining exhibitor under this section, such exhibitor may institute a further arbitration proceeding to be held before the arbitrator who entered the original award, if available, upon the ground that such award has not in good faith been complied with by a distributor against whom it was entered. If in any such proceeding the arbitrator finds that the distributor has not in good faith complied with the original award, the arbitrator may award damages to the exhibitor for loss resulting from the distributor's failure to comply with the original award. Any award of damages hereunder shall be purely compensatory, but in the case fo firstrun exhibition shall not exceed the amount of rentals received by the offending distributor from the circuit for its features licensed for exhibition in violation of the award, and in the case of subsequent-run exhibition shall not exceed twice the amount of such rentals. Proceedings for an award of damages for violation of the original award must be commenced within sixty days after such violation has occurred, by filing with the arbitrator any serving upon the distributor a statement and specification of the facts constituting each violation for which damages are sought and of the exhibitor's damages resulting from such violation. There shall be no award of damages in any such proceeding for any violation of the original award of which complaint is not so filed and served within said period, but prior violations may, in any such proceeding, be considered by the arbitrator as evidence bearing upon the question of the distributor's good faith. VIII Acquisitions of or Changes with Respect to Theaters in Which Defendants Are Interested (1) Each of the defendants will notify the Department of Justice immediately of any legally binding commitment for the acquisition by it* of any additional theater or theaters. (2) Each defendant will also report* to the Department of Justice on or before the tenth day of each month the changes in its theater position, if any, that have occurred during the preceding month, which shall include: (a) Theaters contracted to be built, or building; (b) Theaters lost or disposed of; (c) Theaters acquired; (d) Interest in theaters acquired, stating the nature and extent of such interests; (e) A statement of the reasons for such changes. (3) If upon receipt of such information the Department of Justice requests further information with respect to any of the above transactions, such defendant will make a reasonable effort to supply such information promptly; provided, however, that no information furnished shall be divulged by any representative of the Department of Justice to any person other than a duly authorized representative of the Department of Justice, except in the course of legal proceedings to which the United States is a party or as otherwise required by law. (4) For a period of three years following the entry of this decree, no defendant shall "Shin Game" Clichs New Haven — Bathing Beauty contest series at the Loew-Poli Bijou is packing the house weekly, regardless of heat. enter upon a general program of expanding its theater holdings. Nothing herein shall prevent any defendant from acquiring theaters or interests therein to protect its investment or its competitive position or for ordinary purposes of its business. Proceedings based on a violation of this sub-paragraph 4 of section 8 shall be only by application to the Court for injunctive relief against the corporate defendant complained against, which shall be limited to restraining the acquisition of or ordering the divestiture of the theaters or interests therein, if any, about to be acquired or acquired in violation of this section. IX Escape Clause At any time after June 1, 1942, any defendant may move to vacate the provisions of sections 1, 2a and 2b of this decree by filing an application under oath stating that during any constructive nine months period preceding the filing of such application either (1) two or more distributors of motion picture films operating on a national exchange basis have leased their feature motion pictures* other than in accordance with the provisions of sections 1 and 2a of this decree or (2) 45 or more feature motion picture films have been leased other than in accordance with the provisions of sections 1 and 2a hereof. The petitioner and the other defendants who have signed the decree shall be served with notice of the filing of such application. Upon such application, the Court shall enter an order relieving the defendants of further compliance with the provisions of section 1, 2a and 2b of this decree but not before August 31, 1942 unless within 60 days after service of such application the petitioner shall establish to the satisfaction of the Court that during said nine months period (1) more than 72 per cent of the total gross income from licenses for the exhibition of motion pictures in the United States, excluding the gross income of State rights exchanges, has been derived from pictures leased by the defendants bound by this decree; and (2) the applicant distributor's percentage of the total gross income from licenses for the exhibition of motion pictures in the United States distributed by it and by all distributors not bound by this decree, excluding State rights exchanges, has not decreased more than 5 per cent of the percentage which such distributor's total revenues for the calendar years 1937, 1938 and 1939 is to the total for said three years of such distributor's revenue and the revenue of all distributors not bound by this decree, excluding State rights exchanges. Each distributor subject to this decree agrees that upon the request of the Department of Justice it will furnish promptly all information and data which reasonably is required for the purpose of this paragraph. *The notification and report shall include such commitments and changes as may have been made by corporations not parties to this decree which are controlled by' such defendant. They shall also include such commitments or changes as may have been made by corporations in which such defendant owns a financial interest but does not control if such defendant has received knowledge of such commitments or changes. Each defendant will request such corporations to immediately notify it of any such commitment or change. Arbitration Machinery (a) Selection of neutral arbitrators. A penel of not less than 10 neutral arbitrators for each exchange district shall be designated by the American Arbitration Association. Neutral arbitrators shall not have any past or present connection with the production, distribution or exhibition of motion pictures nor any interest in any theater, as either landlord, lessor or otherwise. The neutral arbitrators shall be paid at the rate of $ per diem when hearing a case. (b) Arbitration appeal board. There shall be an arbitration appeal board consisting of 3 members appointed by the Court, each of whom shall be a person of known impartiality and distinction. One member shall be designated by the Court as chairman of the board. The jurisdiction of the board shall be to hear and determine appeals. Members of the appeal board shall be compensated on an annual basis. The chairman shall be paid $ Other board members shall be paid $ The Appeal Board shall sit and its offices shall be located in Washington, D. C. (c) Arbitration procedure. An exhibitor who has the right to arbitrate under any of the provisions of this decree may require the distributor to arbitrate the controversy, giving notice to the Secretary of the Arbitration Board located within his district. The parties to the controversy shall mutually agree upon a neutral arbitrator from the panel established for the exchange, district in which the theater of the complaining exhibitor is located. If the parties cannot agree on the choice of a neutral arbitrator from the panel within a reasonable time, the American Arbitration Association shall select a neutral arbitrator from the panel. (d) Costs of arbitration. The arbitrator shall award costs against either party or apportion them among the parties as he may deem proper. Costs shall be limited to the arbitrator's fee and the filing fee. (e) Administration of arbitration machinery. The maintenance and functioning of the arbitration offices and personnel in each exchange district shall be under the jurisdiction of the American Arbitration Association. Among the responsibilities of the American Arbitration Association, it shall have the duty of budgeting the cost of operating the arbitration machinery, renting and maintaining offices, engaging personnel, etc. The American Arbitration Association shall prepare a budget setting forth the maximum annual cost of the arbitration machinery, which shall be submitted to the Department of Justice for its approval. Any increase in the amounts so fixed shall be made only after a majority of the companies have approved, -xcept that the Court may, on the application of the petitioner, order such an increase if it finds that such increase is necessary for the effective operation of the arbitration machinery. (f) Financing. The cost of the arbitration machinery shall be met out of a fund made up of (1) ....... . per cent of the gross receipts of each distributor and (2) a reasonable filing fee for each arbitration proceeding to be paid by the party filing the complaint. *"Featu>re motion pictures" as used in this section shall not include "Westerns" and "Foreigus." Examine Shubert Aug. 15 In Wilmer-Vincent Suit Lee Shubert will be examined before trial Aug. 15 in connection with a $25,000 suit brought by Sidney Wilmer and Walter Vincent which seeks an accounting of the profits from the stage and screen presentation of the operetta "Countess Maritza." Plaintiffs claim they turned over the property to the Shuberts in 1924 for 10 per cent of the net profits. It is further alleged that profits now exceed $250,000 and that they were not paid anything. 600 Features in Reserve At British N. W. Bases London (By Air Mail) — T. S. Dawson, acting chairman of the Manchester and Salford district branch of the CEA, recently stated that film stocks in renters' vaults in that section of the country total 5,000 copies of 600 feature pictures. This is the reserve in case of difficulties in supplying films to exhibitors under air raid conditions. "Jones" to Screencraft Screencraft Pictures, Inc., 723 Seventh Ave., has closed a distribution deal for "Emperor Jones," originally a UA release. HCLl_y>VCCf Spearing = By RALPH WELZ ; — HOLLY\ A DDING a new "find" to his I ** screen discoveries, Edward H. G in Charlottesville, Va., filming his prrf for Paramount, "Virginia," has plactj term contract, Lucy Ville Sommer scendant of an old Virginia family. Miss Sommers, who has been act amateur theatricals, was recently see i benefit show in Richmond, and imme I thereafter was given a test. When i mount's chief executive, William Leu saw the test in Hollywood, he imme I wired Griffith authorization to sign a contract. • • D KO has borrowed Robert Mont; i 'Mrom Metro for the co-starring ro i Carole Lombard in "Mr. and Mrs. ! ! the Norman Krasna comedy which Hitchcock will direct. • © PRONT page-minded Warners wii i duce "You're in the Army No Leonard Hoffman and Jack Lucas, w l do the script. Cast — unless the; change of mind — will include Wayne .« Dennis Morgan, Ronald Reagan, Dick r Frank McHugh, Alan Hale and ' Marshall. • • PARAMOUNT, which is scarcely le: to topical advantages, will star n Donlevy in "I Wanted Wings." Irk will play a flying instructor. DEG pardon! This colyum credite V " Nam Sekeley as producer of "H es the other day. Of course, it was r Pagnol. • • CHADES of Wampas! The Scree * ** licists Guild is helping itself tc I of publicity via a search for a "Cinen :ll to launch upon a screen career. Ar ■!< lywood femme more than 16 without 'e experience is eligible. • • £>OMPLIMENT Clarence Brownjl ^^ cigar, and he can truthfully ? raised it himself. The M-G-M rcl has five acres of his 365-acre Ce?» ranch in tobacco. • • DICHARD GREENE joins Paul Mun5 ' * Tierney, Virginia Field and Laird eg in the cast of "Hudson's Bay," 20th Century-Fox picture, which before the cameras next Monday the direction of Irving Pichel. • • PHILIP DORN has been signed to I* ' term contract by Metro. W yjETRO announces acquisition ofM' ■"' ried Bachelor," original unpt &* story by Manny Seff. • • A CHAPTER in the life of Genera ffl titled "A Very Ordinary Mar * be produced by Metro as a Carey " Miniature short subject. Story wa #'| ten by Walter Doniger of studio'; J"! writing staff.