Harrison's Reports (1954)

36 HARRISON’S REPORTS February 27, 1954 MORE ON ARBITRATION Four of the five exhibitor organizations that were invited by Eric Johnston, president of the Motion Picture Association of America, to participate in a new series of arbitration talks have formally accepted the invitation. These include the Theatre Owners of America, the Independent Theatre Owners Association, the Metropolitan Motion Picture Theatres Association and the Southern California Theatre Owners Association. No action on the invitation has been taken as yet by National Allied. In accepting the invitation in behalf of the SCTOA, Harry C. Arthur, Jr., board chairman, stated in a letter to Johnston that, though the distributors have made it clear that they will not be able to agree to arbitrate film rentals, he was of the opinion that the methods by which a film rental agreement is negotiated could be subject to arbitration. “We can well understand,” said Arthur, “that the distributor may not want to subject to arbitration the ultimate amount of film rentals to be paid him, but we believe there are many issues in connection with film rentals that may very properly serve as a basis for arbitration. “While we agree that the final amount to be paid should be at the discretion of the distributor selling a picture, and the exhibitor buying it, based on their mutual agreement, we feel that proper and relevant methods by which that agreement is to be reached should be discussed at this meeting, and where one of the parties claims that improper and irrelevant methods are being used, that claim should form a basis for arbitration. “For instance, in the relationship of film rental to admission prices, and the extent to which the distributor or exhibitor may go in relating the two, may very easily form the basis for arbitration if the parties feel that either one or the other is taking undue advantage or is even in violation of the law.” National Allied has given no indication of what action it will take on Johnston’s invitation, but it is extremely doubtful if it will be accepted. It will be recalled that at Allied’s Boston convention, the delegates unanimously adopted the following resolution, which had been passed by the Allied board at a preconvention meeting: “The members of the board of directors, having fully considered the subject of arbitration, including the position heretofore taken in relation thereto, and having consulted exhibitor sentiment in their respective territories before coming to this meeting, hereby reafl&rm the position taken by them in February 1952, when they proposed the establishment of an all-inclusive system of arbitration for the motion picture industry. “In view of the developments since that time, however, the directors deem it appropriate to add that they can see no practical benefit to Allied’s members in any arbitration plan (a) that does not provide for the arbitration of film rentals and selling policies on a national and regional basis, or (b) that countenance the pre-release of pictures even on a limited scale, or (c) that does not prohibit the initiation of competitive bidding in any situation except upon the wrtten demand of one of the exhibitors involved.” Nothing has developed since the adoption of that resolution to warrant a change in Allied’s attitude toward arbitration. As it has already been said in these columns, the distributors, having excluded film rentals as a subject of arbitration, must have realized that Allied probably would decline to participate in a new conference and it may be that they are hopeful of setting up an arbitration system without Allied’s participation. Whether they will be able to accomplish this remains to be seen, but even if they do succeed it is doubtful if such a system, without Allied’s cooperation, would be either workable or meaningful. A WARNING TO BE HEEDED Several letters received by this paper in recent weeks from different exhibitors express concern over the fact that the industry as a whole appears to be taking it for granted that a cut in the 20% Federal admission tax to 10% is almost certain and that this over-confidence has resulted in a complacency that may very well result in no tax relief at all. It is true that the industry has reason to feel encouraged that it will receive some measure of tax relief, but there is no assurance that such relief will be granted automatically. Several weeks ago. Col. H. A. Cole and Pat McGee, co-chairmen of COMPO’s National Tax Repeal Campaign Committee, warned that a continuation of the industry’s present lethargy toward the tax campaign “can defeat us.” In a letter sent to all state and local campaign committees. Cole and McGee warned that whether or not the industry will be granted relief depends on the following: “ (a) First and foremost, our Congressional strength must be increased, and it is imperative that those Congressmen and Senators not now re-committed be approached without delay, and their support obtained. “(b) Those Congressmen and Senators already re-committed should not be left alone. They should hear from their constituents frequently by letter or personal visit so that their enthusiasm will remain warm right down to the time of the action that is hoped for. “(c) Any continuation of the lethargy and complacency that is evident throughout the country on the part of industry men can defeat us. “ (d) Any assumption that relief of any type will be automatically accorded to the industry without the same painstaking work that was accomplished last year can defeat us. “(e) Any failure on the part of your committee to carefully guide the legislation affecting industry relief can defeat us. “(f) Our effort can be defeated by default if tax legislation becomes enmeshed in intra-Congressional controversy, such as was witnessed for a period last year. Such a controversy, if sufficiently sharp, can defeat all tax legislation this year. “From the foregoing it may be seen that there are no grounds for over-confidence and that there is absolutely no reason for any assurance that the industry will be automatically granted tax relief consideration unless we all work at top pressure at home and in Washington.”