The Film Daily (1940)

Friday, September 6, 1940 0*Xu!!ix Universal Exec. Blasts Excess Profits Measure Would Take 47% of Co. Net as Now Framed, Exec. Tells Senate's Committee (Continued from Page 1) will derive no benefits from defense or Government contracts. Cowdin pointed out that this is virtually twice the tax rate imposed on the majority of other corporations by the bill which he assailed as inequitable, discriminatory and, in effect, confiscatory. $2,025,000 Net For 1940 "U's" chief exec, who pointed out that the company from 1935 to 1938 had lost heavily, finally going into the black in 1939 with $1,153,321 and a net of $2,025,000 for 1940 indicated, demanded to know how it could pay a 47 per cent tax when it currently owes over $4,880,000 for borrowings during years of losses, owes nearly $3,000,000 in accrued and unpaid dividends on its preferred stock, and has a sinking fund requirement on the first preferred stock. Universal, Cowdin emphasized, has no objection to paying whatever taxes the country requires, providing other corporations pay a like percentage of their net profits. Normal Base Yet Unreached Discussing the Universal situation, Cowdin asserted: "The Company has not as yet reached what is believed to be its normal earnings base. The Company was purchased on the belief that with adequate management, its normal gross business should be much higher than it had been. Allowing only 8 per cent to 10 per cent on its turnover will result in much larger profits than any shown to date. Certainly an earning of only 8 per cent to 10 per cent on its gross business can in no way be considered as excessive and would be far below that enjoyed by many other companies. As this point is reached, the percentage of taxes proposed becomes even higher than 47 per cent. "Against corporations which have just begun to recover, after a depression period caused by bad management or other ills, the Bill as passed by the House imposes an unconscionable discrimination as compared with the old line steady earning corporations." Cowdin Recommendations Cowdin 's specific recommendations follow: 1. That earnings on invested capital be computed at 8 per cent instead of a minimum of 5 per cent before the Excess Profits Tax applies. 2. That corporations be permitted to select the results of any one of the last four years as the base for determining excess profits. 3. That corporations be permitted a credit of 8 per cent on the com Family With Four Sons Disqualified From "Four Sons" Stunt When Fifth Son is Born Raton, N. M. — Tom Ward, manager of the Ei Raton here, invited all families with four sons to see "Four Sons" on the house. One family sent over its four sons to the theater but the boys were disqualified when it was learned that a fifth son was born that night. The stunt doubled business at the house for two nights even though there were more htan 60 families with four sons in this town of 6,000. Daniel Frankel Leaves Pathe Lab. Sales Post (Continued from Page 1) 1930. His future plans will be revealed shortly. Frankel spent five years heading his own distribution concern on the European continent, being franchise holder for Metro and the old DeMillePathe Production Co. before coming to the U. S. in 1930 to joint the Pathe International Corp. When the parent company, Pathe Exchange, sold its business of producing and distributing pictures to RKO in 1931, Frankel remained on with Pathe in charge of foreign activities as well as the subsequent liquidation of foreign branches. During this period he spent almost two years abroad. He then returned to New York to organize a large scale independent distribution of Pathe reissues. In 1933 when Pathe Exchange decided to enter the competitive laboratory market aggressively, Frankel was called upon and since played a major role in the organization. Conn. Allied Meets Tues.; Conn. MPTO Defers Parley New Haven — Allied Theater Owners of Connecticut will meet at 12:30 p. m., Tuesday, at the Hofbrau Haus Restaurant, with A. M. Schuman presiding. Connecticut MPTO has postponed its meeting until Sept. 23, at Ceriani's Cafe Mellone. pany's gross business before the imposition of an excess profits tax. 4. That consolidated returns be permitted. 5. If these specific recommendations are not acceptable, that the Committee take the time to work out a tax bill which will eliminate the inequitable and discriminatory features which he called to the Committee's attention. 6. If it is the purpose of this Bill to tax excess profits resulting from Government or other war-time contracts, then the inequalities and discriminations existing in the present draft of the Bill should be eliminated. However, if in reality the purpose of this Bill is to raise a specific or certain revenue to help meet Government necessities — let's frankly face it, and increase the normal rate on all corporations sufficiently to make up for any loss in revenue resulting from the elimination of such inequalities and discriminations. Audience Reactions to Key WMCA's Reviews oi Pix Appointment of Julius J. Colby, formerly film and drama critic of the Ridder chain of newspapers, as dramatic and film editor of station WMCA effective Sept. 16, was announced yesterday by Prexy Donald Flamm. Colby will report first night plays and movies on opening night after curtain time and will also coordinate all dramatic and motion picture material used on the station's schedules. Colby's appointment also marks a departure in the handling of such material for radio, it was stated. The reviews will not contain any critical analysis of technique, but consist of reports of audience reaction. Private lives of stars will neither be attacked nor applauded, Colby explained and only the entertainment value of personalities, pictures and plays will be dealt with during the series. Associated with the film industry since its infancy, Colby was assistant advertising manager for D. W. Griffith in promoting "Birth of a Nation" back in 1911. Several years later, he became motion picture editor of the New York American and the Evening Journal. For the past 19 years he was with the Journal of Commerce and Staats Zeitung, Ridder New York newspapers. Ampa Board in Farewell Luncheon for Lou Lifton Louis Lifton, Monogram Advertising and Publicity Chief, who leaves for his new headquarters in California on Monday, is being feted today at a luncheon at Toots Shor's Restaurant by the Board of Directors of the AMPA of which he has been a member during the present administration. Those present will include Leon J. Bamberger, president, Joseph Gould, secretary, Ed Schreiber, treasurer, Paul Lazarus, Eli Sugarman, Martin Starr and Rutgers Neilson. Absent with regrets: Vincent Trotta in Atlantic City as a Miss America judge. "Fiesta" Moved Up West Coast Bureau of THE FILM DAILY Hollywood — "Fiesta in Manhattan" has been moved up on John Garfield's production schedule by Warner Bros. This means that "The Fabulous Thirties" will be postponed, with Lloyd Bacon reassigned to direct the latter. Expect Senate Will Quickly Okay Walker (Continued from Page 1) of MPTOA, was formally nominated here yesterday by President Roosevelt to be Postmaster-General to succeed James A. Farley, resigned. Early Senate favorable action is expected. It was as general counsel and manager of the theater interests of his uncle, M. E. Comerford, that Walker actively entered the motion picture industry in 1925, having previously held the post of assistant district attorney and member of the Montana State Legislature. An old friend of President Roosevelt, Walker was one of the latter's key supporters in the national election of 1932. He was subsequently appointed by the chief executive to serve as head of the National Emergency Council. Walker's nomination for Postmaster-General heralds that post going to a film executive, — a reversal of the circumstances which brought Will H. Hays, a Postmaster-General, to the executive ranks of filmland, — that of president of MPPDA. Atlas Acquires 26,901 Shares of RKO Common (Continued from Page 1) dition gives Atlas 591,090 shares directly and 268,230 through the American Company. Atlas also acquired 800 shares of 6 per cent convertible preferred and holds a total of 30,681 shares and 327,812 warrants for common. Report of 20th Century-Fox states Joseph M. Schenck disposed of 6,000 shares of $1.50 cumulative preferred and now holds 8,784 and 110,043 shares of common no par value. J. Robert Rubin reports disposing of 600 shares of Loew's common, no par value, holding 25,015 shares. Columbia lists Nate B. Spingold as having 10,178 shares of common no par value through a holding company and 100 additional shares held jointly. He holds no equity securities directly. Name Eight Librarians To Academy Advisory Board West Coast Bureau of THE FILM DAILY Hollywood — Eight leading studio and public librarians of Southern California have been named to posts on a special advisory board to aid the Academy of Motion Picture Arts & Sciences. Scientific and engineering branches of the library will be expanded to provide special facilities for use of technical workers in the industry.