Harrison's Reports (1950)

Entered as second-claws matter January 4, l'J21, at the post office at New York, New York, under the act of March 3, 1879. Harrison's Reports Yearly Subscription Rates: 1270 AVENUE OF THE AMERICAS Published Weekly by United States $15.00 (Formerly Sixth Avenue) Harrison's Reports, Inc., U. S. Insular Possessions. 16.50 M Y t, on i\j v Publisher Canada 16.50 Wew Iork zu' n' *• p. S. HARRISON, Editor Mexico, Cuba, Spain 16.50 A Motion Picture Reviewing Service Great Britain 17.50 Devoted Chiefly to the Interests of the Exhibitors Established July 1, 1919 Australia, New Zealand, India, Europe, Asia .... 17.50 Ug Editorjal Policy; No Problem Too Big for Its Editorial Circle 7-4622 35c a Copy Columns, if It is to Benefit the Exhibitor. A REVIEWING SERVICE FREE FROM THE INFLUENCE OF FILM ADVERTISING Vol. XXXII SATURDAY, JUNE 17, 1950 No. 24 BARNEY BALABAN FACES THE FACTS In his opening address at the Paramount sales convention, held this week in Los Angeles, Barney Balaban, president of the company, warned the delegates that the costs of pre ducing and distributing pictures must come down if the company is to survive under the present changed conditions. Citing figures furnished by his statistical department, Mr. Balaban said that domestic grosses on the 50 top-gross* ing pictures released in 1946 ranged from $2,400,000 to $9,000,000, whereas in 1950, on the basis of present avail' able information, the 50 top-grossing pictures will turn in domestic grosses ranging from $1,500,000 to $5,000,000. "Furthermore," he added, "the current outlook indicates that very few of the A pictures released this year will gross domestic in excess of $2,000,000." In pointing up the need for strict economy from the time a picture is planned to its sale for exhibition, Mr. Balaban declared that "the standards of the past belong to another world," and that "the only thinking and planning that will produce results under present conditions are those based on the realities of the future." "Although the current mood of our industry is to frown on any suggestion that all will not be bright and rosy," he said, "my obligation to you impels me to speak out realisti' cally. I would rather risk the unjust charge of pessimism today than endure the guilt of negligence a year from now." Mr. Balaban is to be commended for his realistic thinking. As pointed out in these columns last week, optimism is a fine quality, excellent in its way, but it should never blind the business man as to the real problems he must face during a period of declining revenues. Harrison's Reports has already counseled the exhibitors not to be deluded by optimistic predictions, but to plan their operations intelligently and realistically to overcome the present period of economic stress. Here you have the same advice from a man who is in a position to know what he is talking about. MYERS HAILS COURT'S AFFIRMATION AND ALERTS EXHIBITORS ON QUESTION OF DIVESTITURE Under the heading, "End of the Trail," Mr. Abram F. Myers, general counsel and chairman of the board of Allied States Association of Motion Picture Exhibitors, had this to say in a bulletin dated June 9: "When on July 25, 1949 the U. S. District Court in New York ruled that the three hold-outs— Loew's, 20th Century and Warner Bros. — must submit to total divorcement, we felt surely that must be the end. "Then the dilatory tactics about which Thurman Arnold complained so bitterly in 1940 were resumed and it was not until February 8, 1950 that an order was entered on that opinion. "Then these defendants took the full time allowed by the rules in which to take a second appeal to the Supreme Court and had the time extended for the filing of the record. "No sooner had the record been filed than WHAM! The Supreme Court affirmed the District Court's divorcement decree without even hearing argument. "A MERITED REBUKE "The Supreme Court does not act upon impulse, even though it sometimes acts with startling speed. The Paramount case is now 12 years old. The delay has made a mockery of the Federal Rules of Civil Procedure. It will be noted that the filing of this last appeal was delayed until almost the end of the present term of court. Argument and a decision in the regular course would have meant further delay of from 6 to 8 months. "That was too much for the court to swallow. With the issues clearly stated on the face of the appeal papers, the Supreme Court could see that the District Court had carried out the instructions given it on the former appeal. In summarily affirming the District Court's decree the Supreme Court administered a merited rebuke to the defendants. "The history of this case rivals that in the celebrated case of Jarndyce v. Jarndyce made famous by Charles Dickens. The accumulation of motions, pleadings, briefs and memoranda is staggering in size, appalling in the amount of time and money expended. Some day someone will write a history of this case which will occasion such an outcry at the permissible delays under the existing rules that remedial steps will be taken. "Meantime, we still hold to our idea of a special antitrust court as outlined before the House Small Business Committee in November, 1948. "PARAMOUNT AND RKO VINDICATED "Following the Supreme Court's decision in May 1948, Paramount and RKO read the handwriting on the wall and voluntarily negotiated with the Department of Justice for decrees which provided, first, for total divorcement and, second, for the divestiture of certain theatres included in the segregated circuits. "These companies in their desire to conform to the law and put their houses in order, risked the criticism which inevitably would follow in case the other defendants succeeded in securing a reversal of the divorcement order. "Now the management of those companies has been fully vindicated. The settlements which they made were favorable to their interests because they were obtained at a time when the Department wished to obtain precedents for total divorcement. "Reporting the summary action of the Supreme Court under the sub-heading 'See Easier Terms for Faster Finis,' Variety says : " 'The Government will still welcome settlement talks with the last defendants in the case and offer easier terms in return for a faster windup to the 12-year-old litigation." "The question of the theatres to be divested by the divorced circuits still is wide open and in the interest of speed and justice should be settled by agreement. But the notion that these recalcitrants, after exhausting their privileges under the rules and the patience of the court, should now be granted special favors for doing what the court says they must do, and what they could and should have done two years ago, is fantastic. "Independent exhibitors having just grievances against competing theatres affiliated with Loew's, 20th Century or Warner Bros, should send the facts to the Department of Justice for consideration when the question of divestiture comes up. "The decree entered by the District Court on February 8 will become a final decree within the meaning of Sec. 5 of the Clayton Act (15 U.S.C.A. Sec. 16) when the mandate of the Supreme Court is sent down — in about 30 days. This is of importance to independent exhibitors having triple-damage suits against defendant film companies. "Of course, the defendants can ask the Supreme Court for a re-hearing on its order of affirmance and the trade papers arc hinting that they will do so. A burnt child knows enough to shun the fire, but not some grown-ups."