The law of motion pictures (1918)

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DISTRIBUTOR — IN GENERAL 215 tributor to compensate the manufacturer for the films. In the one case the negative of the film is sold outright to the distributor for a lump sum, usually amounting to the actual cost of production, and positive prints of the film are sold at a specified amount per foot; the other method is to have the producer lease the positive prints of the film to the releasing agency, the gross receipts being divided between the two upon a fixed percentage basis. The former method was the one first adopted in the industry, but the latter has become more popular in the past few years and will undoubtedly ultimately supplant the older method entirely. That is true especially because of the growing custom of forming manufacturing organizations to make the pictures of a single star and giving him a part of the capital stock of the company. The star, being a stockholder, will turn the films over to a releasing company, only upon condition that a share of the receipts are returned to the company. In this manner a profit is derived from the exploitation of the film, from which the star receives a share on account of his stock holdings. Litigation between the producer and the releasor is infrequent. Their interests are, as a rule, closely allied and, as the control of each one is in the same group of men, all disputes between them are usually settled intra mura. Occasionally, disputes arise which reach the courts, and the questions which come up are complicated and difficult of adjustment. In the case of Goldburg v. Popular Pictures Corporation the producer, under his contract with the distributor, made for and tendered to it a negative of a film. Under