Harrison's Reports (1955)

176 HARRISON'S REPORTS October 29, 1955 pictures be distributed in accordance with the provision which I have quoted. "But the film companies, encouraged by a tolerant Antitrust Division, have been trying ever since to evade the intendment of this provision as well as the provision against fixing admission prices. Never before was such a bold attempt made to legalize prereleases and extend clearances as in the draft of an arbitration plan recently released. "Speaking only for myself, I do not believe I would have any positive objection to any arbitration scheme so long as the use of it was not obligatory on exhibitors and it did not actually harm those who did not invoke it. I might think the system futile and a waste of time and money, and in that case would feel free to say so, but I would respect the right of anyone to go for it if he saw fit. "Now Allied rejected the 1952 Keough-Schimel draft of an arbitration plan not only because it did not provide for arbitrating film rentals and sales policies. It rejected that plan also because, by reserving to the distributors the right to prerelease two pictures each per annum, it tended to nullify important provisions of the decree and would seriously injure its members. "But the 1952 draft contained a denfinition of clearance calculated to protect subsequent run and small town exhibitors against unreasonable clearances of the kind we have been discussing; that is, clearance not noted in the contracts. "In the negotiations the distributors, quite naturally, advanced the now obsolete definition of clearance which reads as follows: " 'Clearance means the period of time stipulated in license contracts between runs of the same feature within a particular area or in specified theatres.' "Bearing in mind the cases arising under the old consent decree arbitration (1940) in which the distributors took the position that there was no arbitrable clearance because it was not specified in the contracts,1 I insisted that there be added to the definition the following: " 'or which regularly occurs between the prior and subsequent runs in competing theatres in the absence of any express contract provision describing the same.' "The distributors finally yielded to my insistence and the definition of clearance contained in the Keough-Schimel draft contained this clause. Lest someone suggest that I should not now claim credit for something that occurred behind closed doors three years ago, let me cite the statement of the late Austin Keough to the Senate Small Business Committee: " 'A compromise had been made, apparently not agreeable to the exhibtors that 2 pictures per distributor per year might be prereleased. Now clearance as we define it, we liberalized the definition of clearance. That wasn't a definition in the courts. We took Mr Myers' definition. That would have brought the subject up for arbitration. That would be arbitrated. Could we do more? Was it a subject?2 The arbitrator could have decided that. (Printed hearings, p. 633.) "Now in the draft just released, which I suppose must be called the Levy-Schimel draft, my amendment to the definition was eliminated. Now both Levy and Schimel were present at the negotiations in 1952. They heard all the arguments advanced in favor of this amendment. They could not have been unaware of its importance to the exhibitors. "In the face of this record, how can we escape the conclusion that deleting my clause from the definition of clearance, coupled with the retention of the provision permitting the prereleasing of two pictures per company per year, constitutes a deliberate attempt to legalize the prereleasing practice with all the disruptions and injustices that it entails? "That the distributors should contend for this archaic definition of clearance is understandable. But I cannot understand why representatives of exhibitors should go for it. Some day the strange events that occurred behind that iron curtain in Los Angeles will seep through and I will get a clearer understanding as to why the exhibitors present voted thanks and congratulations to Messrs. Levy, Wolfson, Fabian and Wilby for their accomplishments in regard to arbitration. "Maybe there are advantages in the draft for exhibitors that I have not discerned. Maybe the draft was not fully explained to them before they acted. "However that may be, the subject will be gone into thoroughly and in the open at Allied's 1955 National Con vention in Chicago on November 7, 8 and 9 There won't be any blind voting there in any sense of the word. The best way to test exhibitor sentiment is at open conventions where all sides can be presented and considered before a vote is taken." 'The matter of Rowlands, No. 13, decided December 26, 1941; Matter of Main, No. 14, decided December 26, 1941; Matter of McLendon, No. 17, decided February 2, 1942. 2Mr. Keough evidently did not correct the transcript. What he probably meant was, "Was it a subject of arbitration?" A LITTLE FELLOW UNBURDENS HIMSELF (Editor's Tsjote: The following letter from R. B. Smith, owner and manager of the Sierra Theatre, Chowchilla, Calif., clearly expresses the bitter disappointment felt by many of the small exhibitors who attended the recent TOA convention with the hope that some positive action would be taken against harsh distribution practices that threaten their existence, only to find that the problems were of little concern to the TOA leaders, who are representative of the big circuits.) October 16, 1955 Dear Mr. Harrison: Here is a word from the littlest of the "Little Fellows" to attend the TOA convention in Los Angeles. I went there with a purpose. That purpose being to see for myself if there is any hope for survival through unity. With a sincere desire to learn what is going on I attended each and every one of the sessions. I was astounded at the small attendance at the sessions as compared to the big registration. As they opened and closed, one after the other, the reason became apparent to me. We were being given the cut and well dried reports of the action, if any, that HAD been taken by the board, all of which could be assimilated in a few minutes of reading time in any trade paper. However, I stuck through them and looked forward to Saturday. These were closed sessions, open to exhibitors only. The morning passed as uneventful as any other session The afternoon still held promise since it was to be a "Speak-your-mind-session." There were some concrete examples of what could be done to help the small exhibitor, or I should say of what the exhibitor could do to help himself. Perhaps we should look to Canada for some advise. While it was conceded that, if we were to supply the same stringent methods in the U. S., there might be some question of coercion, it was pointed out that legal methods could be found to accomplish the purpose. Unfortunately, the methods suggested required strong leadership not to bring lip service pressure to bear on the distributor — but to unite the exhibitors in a concerted action in BUYING FILM IN A COMMON SENSE MANNER. This all important point was touched very briefly by Mr. Wolfson when he said "The best advice to exhibitors to bring normalcy to the unreasonable pricing of films is a polite but firm 'NO!' This leadership seems to be lacking here. I suspect the reason for this is that the "Big Boys" do not really have the interests of us "Little Fellows" at heart. Some of them may have small theatres that they either own or control. Some of them no doubt have been forced to close some of their theatres. To them this is an item on a financial statement. To us it is our life's work down the drain. There were a few other "Little Fellows" at the convention. One exhibitor spoke of the closing of the second of his sixteen theatres as though he was burying an old friend. His pleas for assistance were listened to politely Another asked if there was not somewhere that the "Little Fellows" could meet to discuss our problems. He was treated with respect. I think that the "Big Boys' " attitude was well summed up by a conversation that my wife and I overheard on the way from the Biltmore to the Ambassador Hotel. Since cab service between the hotels was part of the agenda, the cabs were loaded five to the cab. My wife and I were in the front seat and a couple of the "Big Boys" were in the back. Nothing could be gained by identifying them, but the conversation went something like this. "How did the session go this afternoon?" (This referred to the speakyour-mind-session, more commonly known as the gripe or bitch session). "Oh so so, I guess." "Well they wouldn't be happy unless they had the chance." The one had not attended the session because he had been too busy "pampering the tempermental stars and arranging for Mr. War (Ccmtinued on inside page)