Harrison's Reports (1934)

HARRISON’S REPORTS January 13, 1934 8 24. The producers pledge themselves to make cleaner pictures, thus delivering to the exhibitor pictures that do not offend the morals of the people of their communities. 25. The distributors pledge themselves to make clean advertising material. 26. The President’s Executive Order grants the Code Administrator the right (a) to review, and if necessary to set aside, any decision of the Code Authority or of any alternate named by any member of it, or any member of any committee set up by the Code Authority, if in his opinion such person has failed to be fair, impartial and just, and (c) to add to the Code Authority any additional members he may see fit in order to enable a class he feels is not represented adequately to have adequate representation. Against these benefits, what are the reforms the exhibitor leaders were able to obtain from the producers ? Let us see : In 1920, an agreement was signed between the executives of Motion Picture Theatre Owners of America, of which Sidney Cohen was president at that time, and Mr. Adolph Zukor, whereby Mr. Zukor pledged himself not to buy or build any more theatres without the approval of the national exhibitor organization. That agreement was not kept. With Mr. Hays’ entry into the industry, the exhibitor leaders began to agitate for a uniform contract. And rightly so; for at that time every distributor had a contract of a different form and it was impossible for the average exhibitor to protect his interests. After negotiations with the Hays forces, a uniform contract was granted to the exhibitors. But at what cost? At the cost of a one-sided arbitration system, a system which years later the Federal courts had to declare illegal, compelling the producers to scrap it. Between 1923, the year when the first uniform contract was obtained, and 1926, conferences were held periodically between representatives of producers and distributors for better contract and arbitration terms, but no reform was obtained to ameliorate the condition of the independent exhibitor. The abuses became, in fact, so many, and the outcry of the abused was so great, that at last the government at Washington had to pay some heed to them and on Oct. 10, 1927, a Trade Practice Conference was called by the Federal Trade Commission, under the Chairmanship of Mr. Abram F. Myers, at that time Chairman of the Federal Trade Commission, to compel the producers to abandon their unfair trade practices. Many reforms were adopted at that Conference, but no sooner did the sessions end than the producers forgot their promises. Some exhibitor leaders felt that their inability to compel the producers to acknowledge their obligations and to honor the promises made to them at different times was owed to the fact that control of M. P. T. O. A., the national exhibitor organization, was obtained, through unholy means, by the Hays organization. And so they formed what is now known as Allied States Association of Motion Picture Exhibitors, inviting Mr. Myers to head it. The first move Mr. Myers made was to draft a bill effecting needed reforms and to introduce it in Congress through Senator Smith W. Brookhart. That was in the latter part of 1928. But our combined efforts, herculean, indeed, failed to induce Congress to make that bill a law. In the fall of 1929, District Judge Thacher, of the Southern District of New York, declared the Credit Committee system of the Hays organization legal, but its arbitration system illegal. The producers appealed the arbitration decision, and the government the credit committees case, and shortly afterward the U. S. Supreme Court upheld Judge Thacher in the arbitration case, and reversed him in the credit committees case, declaring both systems illegal. Allied States then began to agitate for such reforms as would be within the law. After much dickering, Will H. Hays invited the Allied leaders to a conference. But he had to tie that invitation with strings — he wanted at those conferences representatives of M. P. T. O. A. The Allied leaders, having no way out, agreed to meet under such terms, and from that conference, held at Atlantic City, in 1931, came what is known as the 5-5-5 contract: that is, a contract negotiated by a committee consisting of five producer-distributors, five representatives of Allied States, and five representatives of M. P. T. O. A. There was some rejoicing because of the reforms the Allied leaders obtained at that conference: but that rejoicing was short lived, for again the producers showed bad faith — they failed to adopt the 5-5-5 contract. In desperation, the Allied leaders again began to feel that nothing but a law could force the major producers to abandon their unfair practices. And so they prevailed upon Senator Brookhart to re-introduce his bill in Congress. The second exhibitor effort was no more successful than the first. And so was the case with the third re-introduction of the same bill, rewritten to conform in some measure to the wishes of the representatives of M. P. T. O. A., who, for some unknown reason, agreed with Allied that nothing but legislation could give the exhibitors the reforms they were seeking. (The fraternization of Allied with M. P. T. O. A. did not last long.) The last time an effort was made to bring the Allied leaders together with the producers was a year ago, when Sidney R. Kent, president of Fox Film Corporation, undertook to invite them to talk over matters. The Allied leaders were at first skeptical but when Kent made them understand that, although he was not officially representing the other major companies, these would adopt any fair contract that would come out of those conferences, decided to accept the invitation. And so the Allied leaders again spent valuable time and treasure conferring with the representatives of persons who have never meant to keep their promises. They did not see through the producer plan of attrition — of calling them into conferences, making them spend all the organization money, promising them everything including the moon, and giving them nothing so that they may become discredited in the eyes of the exhibitors. And yet when at last the government, in a general scheme of industrial reforms, comes along and offers a plan of immediate relief, asking us to try the plan for ninety days, promising us to remove all unfairness that might develop while the Code is in operation, these leaders, instead of showing gratitude and advising the exhibitors to go along with the government, begin shouting and pulling their hair, in an effort to lead you to believe that the Code offers nothing. I do not mean to underestimate the efforts of these leaders, or to question their sincerity ; I have merely presented these facts in a desire to prove to you that what the Code offers is so much more than the most optimistic exhibitor leader has ever dreamed of obtaining from the producers either by negotiation or by court action, that there should be rejoicing instead of complaining, particularly since the government has made it plain that the present Code is not the last word. (To be concluded next week) IMPORTANT! (1) If you have notified a distributor that you desire to avail yourself of the ten percent cancellation provision in the Code so as to cancel some undesirable feature pictures you have bought from him, the percentage of such pictures to begin with the release of December 7, but the distributor asserts that the Code is not retroactive, and so you are not entitled to cancel any of his pictures, pay for those pictures but inform him that you are doing so under protest, and that >-ou intend to lodge a complaint against him with the Grievance Board, as soon as one is set up for your exchange centre and begins functioning. The cancellation provision in the Code is retroactive, the assertion of the distributors to the contrary notwithstanding. (2) Retroactive is, in my opinion, also the arbitration provision of the Code, as defined in the Optional Standard License Agreement, which is now part of the Code. You should, therefore, as suggested in last week’s issue, notify all Distributors that you want all disputes that may arise under your contracts with them submitted to arbitration. (3) The time the Code went into effect was December 7. the time for the signing of the Code has been extended to January 31. (4) Beginning with next week’s issue, the Question and Answer Department on Code matters, promised you recently, will begin functioning : therefore, if you are in doubt as to your rights under any provisions of the Code, or if there are any matters that you think ar° not covered hv it. write me about it and an answer will be printed in that Department if the matter is of general interest. (5) No attention will be paid by the Code Authority to any recommendations for appointments on either the Grievance boards or on the Clearance and Zoning boards, made by exhibitors, either leaders or members of the rank and file, unless they have signed the Code compliance.