Harrison's Reports (1939)

4 HARRISON'S REPORTS January 7, 1939 buys enough pictures from three distributors to take care of his needs with the exception of a few play-dates : when he goes to a fourth distributor to book an outstanding picture of his, that distributor will require the exhibitor to fill all his remaining play-dates before he will let the exhibitor have the picture he wants. But what will he tell his public when a fifth, a sixth and even a seventh distributor will have produced a meritorious picture and he cannot show it ? This discussion refers to cases, not where the fourth distributor has an opportunity to lease his entire product to a second exhibitor, but where there is no second exhibitor to lease his pictures to. The exhibitor representatives should demand that, where there is no competitive theatre, the exhibitor be allowed to lease any number of a distributor's pictures. There have been cases when an exhibitor had filled all his play-dates from the programs of a few distributors and a left-out distributor retaliated either by sending to the people of the exhibitor's town circulars designed to cause the public to bring pressure on such exhibitor, or by renting his pictures to either a school or a church. The exhibitor could not persuade such distributor to desist by telling him that he had no room for his pictures ; the distributor remained adamant. By allowing such exhibitor to book as many pictures from a distributor as he wants, he can satisfy all distributors. Abuses arising out of this proposal will, of course, be arbitrable ; but it will be well for the exhibitor representatives to gain such a concession at least for theatres that have no competition within a reasonable distance. And "reasonable distance" should not mean forty-five miles or thereabout. Incidentally, some trade papers, in reproducing this proposal, omitted the phrase, "to license such number on the sole ground that by reason," immediately after the word "refuses," in the third line. Film Daily reproduced it first, in its December 5 issue, and since those trade papers omitted the same number of words it is manifest that they copied it from that Film Daily, (not Boxofficc) . "5. Runs and Existing Customers: (A) Provided an exhibitor and a distributor can mutually agree upon terms, an exhibitor shall be able to obtain some run of a distributor's pictures provided that each exhibitor's theatre is not of obsolete character, is in good condition and operates under a policy which is not destructive or which would not substantially affect the business of any other run of distributor's pictures and further provided that such exhibitor is of good reputation as a theatre operator and financially responsible. Any dispute as to whether or not the exhibitor's theatre is of obsolete character, is in good condition, is operated under a policy which is destructive or which would substantially affect the business of any other run of distributor's pictures or whether or not the exhibitor is of good reputation as a theatre operator and is financially responsible, shall be determined by arbitration. "(B) Exhibitors have complained that distributors have licensed their product away from an existing customer to another exhibitor because such other exhibitor operates a circuit of theatres in the same or other situations and licenses the distributor's product for such circuit. "It is recognized that a distributor has the right to select its own customers and it is also recognized that a change of customers is sometimes a hardship to an existing customer, but that in order to be entitled to continue to receive consideration as a customer, the exhibitor should have substantially performed his previous license agreements with distributor, maintain and operate his theatre in a modern and up-to-date manner and be financially responsible. "Having regard for these principles, product will not be licensed away from an existing customer to a new or another exhibitor for the sole reason that the new or other exhibitor is a customer of the distributor in the same or other situations and any dispute as to whether or not a distributor has licensed its product away from an existing customer for the sole reason that such other exhibitor is a customer of the distributor in the same or other situations shall be determined by arbitration." This provision, too, could stand considerable clarification by rewriting. For instance, it says that, provided the exhibitor is "financially responsible," he can get some kind of run for his theatre. Responsible financially to whom ? Does it mean, "provided the exhibitor pays his bills"? If so, why doesn't the provision say so? If it should be left as it is, the exhibitor members of the negotiating committee would be lending themselves to the revival of the credit committees, which the courts have outlawed. Why should a group of distributors be interested in the financial standing of the exhibitor in his community so long as he pays his bills to any distributor he does business with? And why should such phraseology he necessary when the distributors send to the exhibitor (J.O.D. even posters? Another of the clarifications that the exhibitors should ask of the distributors is the phraseology, "Provided an exhibitor and a distributor can mutually agree upon terms." Does this mean that, when the distributor places on his product a high price so as to make an agreement impossible, such distributor's purpose being.to favor a competing affiliated theatre, the exhibitor will have no right to appeal to the arbitration board for relief? If such is the case, the matter should be so stated, to enable the exhibitor-negotiators to determine whether to accept or reject this provision. "6. Short Subjects, Newsreels and Trailers: No exhibitor shall be required, as a condition of licensing feature motion pictures, to license short subjects, newsreels or trailers, but nothing herein shall be deemed to prohibit any effort by the distributor to license short subjects, newsreels and trailers." In view of the fact that a seller has at all times the right to make an effort to sell his product to a buyer, a right that is recognized in all democratic nations as lawful, the stipulation "but nothing herein shall be deemed to prohibit any effort by the distributor to license short subjects, newsreels and trailers" is not necessary and should be eliminated. Retention of this stipulation may lead to more abuse. The salesmen, for instance, may misinterprete its intent, and may try to bring pressure upon the exhibitor to buy the shorts, newsreels and trailers, and the exhibitor may be compelled to contract for them to get the features. The exhibitor representatives should insist upon the elimination of this sentence, or else require that controversies arising out of it be arbitrated. Let arbitration determine whether the exhibitor had been coerced or not. After all, arbitration, if fair, should determine such controversies ; otherwise there will be no peace between exhibitors and distributors. "14. Box-Office Statements: The practice of rendering to a distributor false reports of the box-office receipts in respect of the exhibition of pictures the film rental of which is based in whole or in part upon a percentage of such receipts is condemned by exhibitors as well as by distributors as a practice which not only results in loss of earned revenue to the distributors, but is also unfair and detrimental to the business of honest exhibitors. Exhibitors will endeavor to discourage and eliminate such practice." This provision, if agreed upon by the exhibitor representatives, will cast a reflection upon every exhibitor, for it implies that the exhibitors, as a rule, render false boxoffice statements. The exhibitor representatives should refuse even to discuss such a matter, let alone agree upon it. If there are some exhibitors who, when allowed to show a percentage picture without the presence of a distributor representative, render inaccurate statements of their receipts, it should be the good business judgment of the distributor not to allow again such exhibitors to show a picture of his under such conditions ; the distributor should have a representative check these exhibitors. To demand that the exhibitors acknowledge the existence of such a practice as common is to insult every exhibitor who makes a true statement of box-office receipts, and otherwise conducts himself as an honorable business man. The exhibitor representatives should refuse to deal with such a matter ; it is not in their province even to discuss it. The other proposals are not commented upon. RAY LEWIS TO DO THINGS IN CANADA Ray Lewis, editor and publisher of The Canadian Moving Picture Digest, was recently in New York, on a visit. She told the writer of the fight she has been having with Nathanson, the big theatre and distribution magnate. Miss Lewis may appear as a "David" as compared with Nathanson, but she has a "sling" that may bring the Goliath down : she intends to lay her case directly before the public. In view of the fact that Miss Lewis is fighting a battle, not for herself, but for a woman-exhibitor whom, Miss Lewis feels, Mr. Nathanson has taken unfair advantage of, there is no doubt as to what the outcome of the fight will be. Harrison's Reports has often advocated that the exhibitors take their public into their confidence in any dispute arising between them and a theatre-owning producer. All the chances for a victory are in their favor.