Motion Picture News (Oct 1914-Jan 1915)

December 26, 1914. MOTION PICTURE NEWS FINAL HEAKING IN PATENTS COMPANY SUIT Arguments Heard by Judge Dickinson in Federal Court at Philadelphia — Edwin P. Grosvenor, Special Assistant to Attorney-General Gregory Presents Side of the Government and the Defendants Are Represented by a Brilliant Array of Legal Talent special to Motion Picture News Philadelphia, Dec. 16. GREAT excitement has prevailed in certain motion picture circles this week over the Government suit brought to dissolve the Motion Picture Patents Company. The argument was heard before Judge O. B. Dickinson of the Federal Court. Edwin P. Grosvenor, special assistant to Attorney General Gregory, upheld the side of the United States, while the defendants were represented by a large array of legal talent. Congressman R. O. Moon, of Philadelphia; Charles F. Kingsley, James H. Caldwell, Henry Melville, Charles K. Zug, Samuel O. Edmonds, James J. Allen, H. K. Stockton, George F. Scull and Archibald R. Watson, all of New York; Melville Church, of Washington; George Wills and Fred H. Williams, of Baltimore, and David J. Meyers, of Philadelphia, were retained by the 13 corporation defendants and 21 individual defendants named in the Government's dissolution suit. These are : The Motion Pictures Patent Company, of New York, principal defendant; the General Film Company, the Biograph Company, of New York; Thomas Edison, Inc., Orange, N. J. ; Essanay Film Manufacturing Company, Chicago ; the Kalem Company, Inc., New York; George Kleine, Chicago; the Lubin Manufacturing Company, Philadelphia ; the Melies Manufacturing Company, Chicago; Pathe Freres, New Jersey; the Selig Polyscope Company, Chicago; the Vitagraph Company of America, New York; Armat Moving Picture Company, Washington, D. C. ; Frank L. Dyer, Orange, N. J. ; Harry N. Marvin, J. J. Kennedy, Samuel Long, J. N. Borst, of New York; Siegmund Lubin, Philadelphia; Gaston Melies, George K. Spier and W. N. Selig, of Chicago; Albert E. Smith, Brooklyn, N. Y. ; and William Pilser, Orange, N. J. The Government charges that the alleged monopoly was formed in 1908 by practically all of the manufacturers of motion picture films in the country. Charges of the Government Under an agreement made by these concerns, the Motion Pictures Patent Company was made, the Government alleges, the holding company of all the patents that have ever been issued in Washington. A list of theatres was then prepared and no film exchange was allowed to distribute films to any theatre except those named on the list, it was charged. Uniform prices and rules were made, and if the middleman did not observe the orders of the so-called trust, his supply of films was cut off and he was forced out of business, is was declared. In a brief outline of the Government's case, Mr. Grosvenor referred to the Supreme Court's decisions in the Standard Oil and Tobacco cases, and contended that the present action came within the scope of the rulings in these cases. In reply Mr. Moon contended that at the organization of the company in 1908 there was a disastrous feud among the motion picture factions, and that because of this warfare and the general infringement of patent rights by dissenting interests, the paths of commerce were obstructed. He further declared that the Motion Picture Patents Company was only a trustee of the patents company and not designed to absorb the business of competitors. In the ten years before the organization of the company he claimed that there were so many infringement suits |HiiiiHniiiiiiiiiiiiiiiiiiiiiiiiiiiiftiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiiuiiiiiiiiiiiiituiiiuuiniiiiiiiiiiiiuiiiM I WHERE TO FIND IT | = Department. Page, g I Live Wire Exhibitors 29 | I In and Out of Los Angeles | I Studios 32 I i Looking Ahead 31 | j Editorials 37 | I Among the Exchanges 41 | I Exhibitors' Forum 39 | I Feature Reviews 44-48 | I Program Reviews 49-51 | I Buyers' Guide 102 j I Current and Coming Releases. .52, 53 | I Release Dates for Ready Ref " I I erence 55-57 | I ACCESSORY NEWS 103-116 | iiuiuiiniiiiiiuiiiiHiiiiiiiiiiiiiiiiiiiiiiiiiiiiiuiNiiiiiiiiiiiiiiiiiiiiiiiiiiiiiuiiiuiiiiiiiiiniiiiiiiiiui^ brought by rival interests that several manufacturers were almost financially ruined. Mr. Moon further asserted that the motion picture art had increased infinitely more than any other industry in interstate commerce and he insisted that a New York exchange dealer and not the Government was the real plaintiff in this case. Claims Patents Were Rightfully Applied Continuing, Mr. Moon maintained that the patents instead of being applied to unlawful purposes, were employed in a normal manner to the development of business, and without the amalgamation of the patents the evolution of motion pictures would have been impossible. In his final argument, the Assistant Attorney-General indicated to the Court the enormous profits made by the so-called trust. He claimed the General Film Company absorbed 68 companies, and of the 116 competing exchanges before the formation of the combine, only one survives, he declared. Mr. Grosvenor also alleged that severe penalties were incurred by any exchange dealer who violated even in the smallest degree the regulations in his license. As an example, he cited the case of Lewis M. Swaab, of Philadelphia. Mr. Swaab, in order to catch an eight o'clock train to Baltimore, had to release, it was said, a film at 7 :50 p. m. for an exhibitor who wished to show this film in Baltimore before noon. The hour set for releases by the General Film Company being 8 a. m., Mr. Swaab was fined $10 a minute, $100 in all, by the manufacturers, the penalty of nonpayment being the curtailment of his supply, Mr. Grosvenor asserted. The Government''s lawyer wished to know "if such action were not an arbitrary interference in interstate commerce with the rights of an American citizen." Alleges 1,600 Per Cent Profit Mr. Grosvenor claimed that in the first 18 months of its existence the General Film Company expended more than $2,000,000 purchasing independent exchanges and paying manufacturers, and yet paid 7 per cent, on the preferred and 12 per cent, on the common stock to its shareholders. In fact, emphatically declared the lawyer, on an investment of $10,000 each, ten manufacturers made a profit of 1,600 per cent, in 1911. During the progress of the trial the courtroom was filled with all sorts of moving picture paraphernalia showing the different inventions and patents involved in the suit. Pictures were shown the judge and every point possible brought out by the counsel on both sides. The counsel for defense will submit further arguments. Chas. F. Kingsley assisted Mr. Moon in the conduct of the case and made some of the arguments. The suit was begun on Tuesday, December 8, and continued daily, the Court even holding a night session on Thursday to facilitate the progress of the proceedings. The final arguments in the suit were heard on Friday morning. Judge Dickinson reserved his decision. Irene Page Solomon. HORSTMANN TO ORGANIZE GRANITE STATE EXHIBITORS President E. H. Horstmann and Harry F. Campbell, of the Motion Picture Exhibitors' League of Massachusetts, left Boston on Friday, December 18, for Concord, N. H., where they are to lend their efforts toward organizing an exhibitors' league in the Granite State. They will work in conjunction with Charles Bean, of Franklin, who requested the local league to send up its best organizers to start such an association going. ANOTHER SUNDAY VIOLATION CASE DISMISSED Special to Motion Picture News Louisville, Ky., Dec. 15. Magistrate Ogden, at Jeffersonville, Ind., has dismissed the action against Roscoe Heimbaugh, charged with a violation of the Sabbath law by operating a. picture machine on Sunday.