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PART III: DISTRIBUTION
Chapter III. Unfair Trade Practices
Block Booking and Blind Booking.
"Block "booking" and ""blind "booking", which involve the purchase of films sight unseen, has long been existent in the Industry. Producer-distributors have maintained that this method is economically sound, inasmuch as it assures exhibitors a continuous supply of films while at the same time stabilizing production. Individual selections, it has been claimed, would result in' prohibitive license fees, since all pictures are not box-office successes • The impossibility of prejudging box-office attractions has also been pointed out.
The opponents of block booking and blind booking, who are mostly independents, have claimed that these practices have forced them to show undesirable pictures These independents have had the sup-oort of social, religious, and educational organizations which have realized that independents would probably be ruined financially if they were to refrain from showing, yet be forced to pay, for all unendorsed pictures.
The "right to buy" controversy appears to have been concerned primarily with preferential master contracts existing between oroducer-exhibitors. It has been alleged by independents that certain producer-exhibitors having competition in a specified area are given unfair advantage by being permitted to purchase films of other producer-exhibitors at lower prices than those at ^which the former's competitors are permitted to buy — if they are permitte to bu^/ a"k all* In return the latter producer-exhibitors received this low rate preference from the former when they have competition from independents in their areas.
Independents who have thus been unable to compete with the large circuit and producer-affiliated theatres for the purchase of first-run pictures have been at a further disadvantage because of the fact that these produceraffiliated theatres have exchanged their playing time among themselves. This has resulted in forcing the independents to show subsequent run pictures.
Hhile exhibitors have sought the "right to buy" first runs irrespective of the character of theatre, location, size, quality of accompanying presentations, or prestige and standing enjoyed in the community, producer-distributors have claimed the "right to choose" their customers. They have sought to bring out their features under the most favorable auspices in theatres having established reputations and the best and finest quality presentation in the country. They claimed the right to determine the factors that go into a bargain, such as the financial responsibility of the buyer.
It is generally understood by the independents that the "right to choose1, customers, provided no collusion exists, has been found justified by the Federal Trade Commission, as shown by the following quotation from Federal Trade Commission versus Paramount Famous Players Corporation, 57 Fed. 152:
"A distributor of films by lease or sale has the right to select his own customers and sell such