The Film Daily (1947)

:riday, January 3, 1947 0 *\ DAILY 17 idding Provisions "Impractical", Asserts Levy istributors Empowered to tonne Highest Bidder n Case of Equal Bids .Continued from Page 16) jit, notify all exhibitors in the area as '.-o the following: "(a) A flat rental sum which will represent the minimum sum the distributor wants for such license. Please note that the distributor may name only a flat rental sum. "(b) Number of days to be played. "(c) Time when the exhibition is to commence. "(d) Availability and clearance, if any, to be granted. "Within 15 days after receiving i his notice from the distributor the exhibitor may submit his bid con-aining the following information: "(a) The run desired. "(b) The amount he wishes to pay, flat rental, percentage, or both, or any other form of rental. "(c) The clearance he is willing to accept. "(d) Time and days he wants to play the picture. "(e) Any other offers he cares to make. "The distributor may reject all fads, but if it accepts any bid for .ny particular run must grant the icense to the 'highest responsible oidder (for the particular run), laving a theater of a size, location .nd equipment adequate to yield a easonable return' to the distributor. The language quoted, which attempt o set forth how the distributor will ietermine the successful bidder, is, n my opinion, impractical and impossible of fulfillment. What Is 'Reasonable'? "How, for example, will a disributor be able to determine the ighest bidder of three theaters all ble to give the distributor a 'reaonable return,' in the face of one ffer of $750 flat rental, a second of 0 per cent of the gross and a third nffer of a flat rental figure as l.gainst a percentage? Is it possible for the distributor to determine which of those three offers /ill give him the greatest returns nd the greatest return can be the nly test of the highest bid. What lse can it mean? The words 'highest bidder' are qualified by the word 1 responsible.' That is, 'the highest '©sponsible bidder.' That qualification, it seems, to me, is illusory and ptirely a matter of subjectivity j'/ith the distributor to determine ^/hat 'responsible' means. And who Is to say, and how, what 'a reasonable return' is? What objective 'ests can be applied to determine /hether the successful bidder has a heater 'of a size, location and equipient adequate' to yield 'a reasonble return' to the distributor? "It is not difficult to realize | how soon unsuccessful bidders will be starting their trips to the courthouse, especially with Companies Can Only Roadshow Their Own Pictures in Theaters Individually Owned Roadshows of outstanding features, under the Statutory Court's decision in the New York equity suit, are seen as restricted solely to the individual company's own theaters. The Court had been requested to authorize one road show per year per company for features costing $3,000,000 or more, but made no exception to the prohibition against fixing minimum admissions in license contracts. arbitration discarded as part of the decree. We can, at least from this point, anticipate no end of litigation in an industry already sorely tried by it. "The decree provides that where there is no competition among theaters in a particular area, or in run, or where there is no offer made by an exhibitor for exclusive run, then this type of competitive licensing described under this heading 'shall not be required.' This means then, in substance, that this bidding procedure will be required only where there are theaters or runs in competition, or where an exhibitor submits an offer, as explained above. Competitive Area Defined "(7) The words 'competitive area' are defined as follows: 'The words "competitive area" shall refer to the territory occupied by more than one theater in which it may fairly and reasonably be said that such theaters compete with each other for the exhibition of features on any run.' "This, I feel, is an excellent definition and should be of comfort to those exhibitors who have been anxious about their status, and uncertain as to whether or not, under any new selling system, they would suddenly be placed, for the purposes of bidding, in competition with them. "(8) 'Each license shall be offered and taken theater by theater and picture by picture.' This does not mean that the distributors may not license more than one picture at a time. It does, however, mean that if a theater is granted a license for a group of pictures, then each picture in that group must meet the particular requirements of the decree provisions. "(9) Distributors may not arbitrarily refuse to grant a particular run to an exhibitor, and grant it instead to a competitor. The word 'arbitrarily' is the important one here, and there being no tests offered in the decree as to when the action is 'arbitrary,' it becomes, as a practical matter, something almost impossible of proof by the unsuccessful exhibitor, since whether or not it is arbitrary is pretty much a matter of subjectivity with the distributor. Expansion Rule Stronger "(10) In ordering the dissolution of jointly-owned theaters, where any defendant possesses more than five per cent but less than 95 per cent of the ownership, the decree sets forth that any of the other defendants may acquire the joint owner defendant's interest or the interest of the independent if the proposed purchaser is able to show 'to the satisfaction of the court . . . that such acquisition will not unduly restrain competition in the exhibition of feature motion pictures.' That is the only way that any of the defendants may expand their present theater holdings. This is much stricter than the consent decree provisions in this regard and than what the Court suggested in its June opinion, to wit, that each defendant would be permitted to expand its present theater holdings: "... in order to protect its investments, or in order to enter a competitive field. . . ." "(11) The defendants are restrained from membership in operating, buying, and booking combines if the agent in question is also buying or booking for another or others. Obviously, this is the death knell of these combines. The outlawing is of course, restricted to these defendants. Whether or not a court would also condemn these combines when made up solely of 'independents' cannot be predicted, but the language used in this Court in its opinion as distinguished from this decree would certainly seem to indicate that these Judges thought so. "This is what they stated in general (not referring to these defendants particularly) : " 'It should be added that in our opinion there can be no objection to operating, booking, or film buying through agents, provided the agent is not also acting in respect to theaters owned by other exhibitors, independent or affiliated and provided that in case the agent is buying films for its principal he does this through the bidding system, theater by theater. . . .' Would Save Arbitration "(12) The provisions of the existing consent decree are declared to be of no further force or effect except as to pending arbitration matters. Decisions ultimately made in these matters will be effective when rendered. The Court reluctantly discarded the present set-up of arbitration and stated, 'We strongly recommend some such system be continued in order to avoid cumbersome and dilatory court litigation and to preserve the practical advantages of the tribunals created by the consent decree.' "We of MPTOA regret exceedingly this step taken by the Court. "We had hoped that a way would be found by the Judges to impose arbitration as part of the decree. We asked only ' . . . that it be simplified, .rr Proposes "Oscars' on International Basis In expressing his appreciation for the award bestowed by the New York film critics upon 'The Best Years of Our Lives," as the top film of 1946, Sam Goldwyn declared that he would like to see the Award of the Academy of Motion Picture Arts and Sciences made on an international basis. "I thing the Academy Award should also include pictures made anywhere," Goldwyn said. He deplored the effect of narrow nationalism both upon the industry and upon world affairs in general. Goldwyn looks to the cinema for the means of improving foreign relations. Upon returning here Wednesday aboard the S. S. Queen Elizabeth, after spending the holidays with his son in England, Goldwyn told the press, "If anything can raise the iron curtain of Russia, movies can do it; because the Russians are great lovers of movies." Goldwyn related the purser's request to play "Best Years" for a second consecutive night aboard the Elizabeth. The producer pointed out that to the best of his knowledge this was the first time a picture had been played two nights running on a luxury liner. Molotov, Russian Foreign Minister, on his return to Europe, was one of the many passengers who was glad to see "Best Years" again. The diplomat had already seen the Award-winner in New York. Chicago Mailers Union Talks Newspaper Strike Chicago — Threat of a mailers' strike today confronted Chicago newspapers last night as the union claimed the expiration yesterday of its contract. inexpensive and not financed by the defendants . . . and that independent exhibitors be given a voice in the determination of the details of the system.' And we are today ready to join forces with other exhibitor groups and with the distributors to attempt to bring to the industry a system of arbitration as outlined. "(13) The Government is given the right to examine the books and records of the defendants to determine compliance with the decree. "(14) The sections dealing with cancellation and competitive bidding are not to be effective until July 1, 1947. This means only that the distributors are not compelled to license their pictures on this basis until that date or later if stayed further by the Supreme Court. It does not mean that they may not license their pictures that way if they wish to before that date. That date is when they must do it. They may, if they wish to, do it immediately. It is obviously not illegal."