Motion Picture Daily (Apr-Jun 1940)

Motion Picture Daily Monday. April 1. 1940 Government to Open Arbitration Boards Dispute its Files to Majors jyw^ Settlement i Purely Personal ► (Conl nmcd from pane 1) comes forward with detailed evidence of anti-trust violations in the production field, majors will apply for an order dismissing charges of discrimination in production set forth by the complaint, attorneys told Judge Goddard. Williams was questioned by Judge Goddard for the reasons for agreeing to furnish detailed information if it did not have it available. He explained in response that the Government had always maintained that it was bound to supply only those details of which it had" personal knowledge. Willing to Open U. S. Files Willingness was expressed by Williams to open the Government's files in Washington to defense attorneys "if his superior approved." Williams made this offer to prove his contention that he was prepared to give the majors all available information. In addition, attorneys took up the question of a pre-trial conference to simplify the issues and to effectively shorten the trial. Majors' counsel criticised the proposed admissions which the Government has asked the defendants to concede. Judge Thomas D. Thacher, spokesman for the defendants, declared that it was "utterly impossible" for the defendants to agree to a major part of the Governments' proposals since there was a basic dispute as to definitions and the history of the industry. Columbia would not concede that it was anything but an independent producer, Louis D. Frohlich, attorney for the company, stated flatly. At Judge Goddard's request, attorneys for the defendants agreed to offer counter-proposals for admissions. Williams Attacks Practices In discussing the pre-trial conference, Williams declared that the Goveniment was attacking the fundamental conditions in the industry. It was the control of production, exhibition and distribution by the majors that the Government claimed was in violation of the Sherman anti-trust act, William said. As a result, the industry was not "open and competitive," he declared. Judge Thacher, in reply, said that the defendants for the time being would withhold their hand but that they were prepared to prove on trial that any so-called discrimination was "strictly lawful." WANTED Information leading to the whereabouts of Charles B. Howard and John Russo. Reimbursement will be made to informant for any warranted expense. Please Communicate DOUGLAS ROTHACKER 729 Seventh Ave., N. Y. City (Continued from page 1) some quarters as likely to be most difficult, even to the point of endangering an ultimate settlement of the suit. Present proposals contemplate a nominal assessment of five or 10 cents on each picture licensed anywhere in the United States to meet the costs of maintaining the boards. The suggestions call for appointment of a national administrator and the establishment in each exchange district of a panel of impartial arbitrators with no connection with the industry, one of whom would be selected by agreement to hear a complaint Before these arbitrators would come all controversies over protection, overbuying and other exhibitor-distributor trade relations problems. Exhibitors and distributors, themselves, once their case has gone to arbitration, will have no standing other than that of pleader and respondent. Appeals from unsatisfactory decisions of the Board of Arbitrators would be heard by a central arbitration board, probably designated by the court with the approval of the consent decree, to be heard by a neutral member with technical advice given by two other members representing, respectively, distribution and exhibition. The arbitrators and the appellate board would have wide powers of discretion in the awarding of costs and in the fixing of liquidated damages in controversies calling for monetary adjustment. The proposed elimination of block booking through a consent decree, under which pictures would be offered in blocks of four to eight, is viewed by industry officials as likely to result in a complete revision of the industry's selling methods and of its sales personnel. If the plan was agreed upon, it is pointed out, selling would be localized on a system somewhat similar to that prevailing during the "state's rights" selling era. This would entail smaller sales organizations and local trade showings for exhibitors. The proposed agreement would make affiliated theatre divorcement unnecessary due to the scope of the subjects which would be handled and disposed of by arbitration, and other trade practice changes which will be imposed. Among these are restrictions against selling to theatres outside an exchange district, which, it is claimed, would make it impossible for theatre chains, independent or affiliated, to corner any company's product for a year in advance. This would make it impossible for chains operating in two or more exchange districts to use the weight of their buying power to obtain favorable deals for nouses in districts with independent competition in return for concessions where they had no competition. The changes also, it was pointed out, would give the independent producer a better chance to sell exhibitors, chain and independent, because they no longer will be overbought for months in advance. Frohlich, Farnsworth to Confer on Columbia Queries Louis Frohlich, of counsel for Columbia, and William Farnsworth, special attorney for the Department of Justice, will confer today or tomorrow in an effort to agree on the additional information which Columbia will seek from the Government in response to the company's separate interrogatories. This decision was agreed upon Friday after Frohlich told Federal Judge Henry W. Goddard that the Government's answers to the consolidated interrogatories of the other defendants were "helpful" but left 10 questions unanswered which Columbia had addressed to the Government. The conference between the attorneys is designed to attain an agreement on answers to these questions without the necessity of again appealing to Judge Goddard for a specific order to the Government, as the court authorized the Columbia attorney to do several weeks ago. Walkout at Warner Theatres Averted Philadelphia, March 31. — The threatened walkout on Monday of stagehands, projectionists and electricians at all Warner Bros, theatres here in sympathy with the striking musicians has been averted. A. Rex Riccardi, secretary of the Mus.icians Union, announced an "indefinite postponement" of the walkout following a phone call from Los Angeles with Joseph N. Weber, A. F. M. head. It is expected that an attempt will be made by the musicians to resume negotiations with the theatre circuit during the week as the strike goes into its fifth month. In the meanwhile, the musicians are continuing their picket lines. Million Dollar Legal Battery Into Action (Continued from page 1) Paramount general counsel, and Louis Phillips of the home office legal staff. Col. William J. Donovan of Donovan, Newton, Leisure & Lumbard, appeared for RKO with John Howley of the same firm. Monroe Goldwater of Goldwater & Flynn appeared for KeithAlbee-Orpheum. John W. Davis, chief defense counsel for Loew's-M-G-M ; Louis Frohlich of Schwartz & Frohlich, Columbia counsel ; John Caskey of Dwight. Harris, Koegle & Caskey, 20th Century-Fox counsel, and Benjamin Pepper of O'Brien. Driscoll & Raftery, United Artists and Universal counsel, were among the other legal luminaries on hand. Paul Williams, chief trial counsel for the Government, William P. Farnsworth and assistants appeared for the Government. M'Kenzie to Indiana Maurice McKenzie, executive assistant to Will H. Hays for the past 18 years, will leave for his former home near Crown Point, Ind., today where he will resume residence following his resignation from the M. P. P. D. A. McKenzie's resignation becomes effective today. Homer Harmon has been appointed to succeed McKenzie. A. A. Schubart, RKO manager of exchange operations, and Mrs. S( hubart left over the weekend for a Florida vacation. • James Roosevelt, head of Globe Productions, arrived in Hollywood yesterday by plane from the East. • William C. GehringY '''.vision manager for 20th L . V-Fox. has returned from a Miami vacation. • Constance Bennett left via American Airlines Saturday on her return to the Coast. • George Stevens, director, is in town from the Coast. Dinner Set April 26 By Picture Pioneers The Spring dinner conference of the Picture Pioneers will be held Friday evening, April 26, Jack Cohn, House manager, announced following a meeting of the executive committee at the Hotel Astor Saturday. New members of the organization are R. J. O'Donnell, W. Ray Johnston, Gilbert Josephson, Douglas D. Rothacker, Charles L. O'Reilly, P. J. Morgan, Jack Bowen, Lou B. Metzger, Jerome Safron, J. L. Barkey, J. R. Malcolm, Louis W. Schine, J. Myer Schine and Samuel Strausberg. It is planned to present gold membership cards to these veterans at the forthcoming Conference. Vet Exhibitor Dies Philadelphia, March 31. — Charles M. Rappoport, 64, theatre operator at Salem, N. J., died in a Philadelphia hospital following a long period of poor health. He entered the motion picture business 30 years ago. He operated theatres here and in New York before coming to Salem. Funeral services were held here Friday. His wife and a daughter survive. Columbia Dividend Columbia Pictures Corp. announces that the Board of Directors, at its meeting March 23, declared a regular quarterly dividend of 6S^c per share on the $2.75 convertible preferred stock, payable May 15 to stockholders of record May 1. MOTION PICTURE DAILY (Registered U. S. Patent Office) Published daily except Saturday, Sunday and holidays by Quigley Publishing Company, Inc., 1270 Sixth Avenue, Rockefeller Center. New York City. Telephone Circle 7-3100. Cable address "Quigpubco, New York." Martin Quigley, Editor-in-Chief and Publisher: Colvin Brown, Vice-President and General Manager; Watterson R. Rothacker, VicePresident; Sam Shain, Editor; James A. Cron, Advertising manager; Chicago Bureau. 624 South Michigan Avenue, C. B. O'Neill, manager; Hollywood Bureau, Postal Union Life Building, Boone Mancall, manager, William R. Weaver, Editor; London Bureau, 4 Golden Square, London Wl. Hope Williams manager, cable address "Quigpubco, Lon don." All contents copyrighted 1940 by Quig ley Publishing Company, Inc. Other Quigle> publications: Alotion Picture Herald, Bettei Theatres, International Motion Picture Al manac and Fame. Entered as second clas; matter, Sept. 23, 1938, at the post office a Mew York, N. Y., under the act of Marcl j 3, 1879. Subscription rates per year $6 in thi Americas and $12 foreign. Single copies 10c