Showmen's Trade Review (Jan-Mar 1947)

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SHOWMEN'S TRADE REVIEW. January 4. 1947 5 NATIONAL NEWSREEL Decree Destroys Pooling, Fixed Admissions And Arbitration /Leaves Auction Bids Optional Court Ruling Climax of 9Year-Old Trust Suit; Appeals Are Expected A modified form of competitive bidding which practically leaves it to exhibitors in a competitive situation whether or not they will make use of it, coupled with a guarantee of "some run" to all exhibitors and a 20 per cent cancellation privilege on pictures bought without tradeshowing, will become the law of the motion picture industry within the next 60 days unless an almost certain appeal to the United States Supreme Court halts it. This became evident in New York on Jan. 31 when the federal statutory court handed down its anticipated decree at 3 :10 P.M. The decree is final so far as the statutory court is concerned. The Judges — United States Circuit Court of Appeals Judge August N. Hand, District Court Judges Henry W. Goddard and John Bright — who had acknowledged in court that they were "moved" by exhibitor protest against competitive bidding — noted in papers handed down with the decree that they had modified competitive bidding so that the exhibitor could take it or leave it as he desired. They also took exhibitor opinion into consideration with the clause that gives an exhibitor some run if he wants it. No Cross-Licensing That the decree would be subjected to an appeal was almost certain, however, in view of the fact that the Government, which has repeatedly sought theatre divorcement (which it did not get), also failed to get a ban on cross-licensing which would have prevented one distributor-defendant from selling his pictures to theatres of another distributor-defendant for a 10-year period. Also the appeal of United Artists and others to roadshow, apparently was denied under the price-fixing prohibitions and the competitive bidding provisions of the decree, would indicate an appeal from those quarters as well as from Universal, which failed to get the right to sell by franchise. The defendants have 60 days in which to file an appeal before the decree becomes effective and. if they do appeal, another 30-day stay will be granted. The decree itself follows closely the original court opinion with only slight modifications. It drops arbitration altogether because some of the parties would not consent to it. Among other things the decree provides : (1) An exhibitor alone may fix his admis(Con linued on Page 20) What. Not Movies! The movies didn't get the blame this time. Instead it was radio crime programs and comic books. Police who arrested two young women in Chicago who would hire out for baby sitting and then were alleged to have looted the places, said the young ladies told them that they got the idea from comic books and the radio. It was a comic book which one left behind with her name and address that led to their arrest. The Decree in Brief: COMPETITIVE BIDDING — Required only if exhibitors in a competitive territory demand it. The distributor may reject all bids but if he accepts any it must be that of the highest bidder with a comparable theatre, etc. Preferential treatment is prohibited. ADMISSION FIXING— Admission shall be fixed by the exhibitor only and the distributor is prohibited from attempting to set the exhibitor's admission for him. ROADSHOWING— The decree does not prohibit it as such but the competitive bidding and price fixing apparently do. ARBITRATION — Abandoned to the court's regret because the parties in the case won't "consent to its continuance." The court asks for consideration of arbitration as a means of preventing litigation. DIVORCF. — Theatre divorcement denied but distributors wishing to retain theatre in terests must either increase them to at least 95 per cent or reduce them to five per cent or less. CLEARANCE — Reasonable clearance is permitted only in competitive situations but the defendants must not agree among themselves on any clearance system. FORMULAS, FRANCHISES, THEATRE POOLING— Prohibited along with block-booking. CANCELLATION— Twenty per cent cancellation allowed where roadshowing was not available. SINGLE-SELLING— Each picture must be sold individually and the sale of no picture must be conditioned upon the purchase of another by an exhibitor. DEADLINE — The decree becomes effective 60 days from Dec. 31, 1946 but the court will grant a 30-day stay if an appeal is taken to the Supreme Court. Decree Marks Next-to-Last Chapter In Over 8 Years of Legal Action An expecting but none the less surprised motion picture industry got the long-awaited decree which tells it how to conduct its business late Tuesday thereby bringing to an end the next-to-final chapter in almost nine years of litigation a short few hours before 1946 itself walked out of the present into the past. While the decree written by the three judges of the New York federal statutory court is final as far as they are concerned, every indication points to the possibility that the final chapter in this year-spanning suit will be written in the future before the red-curtained dais of the United States Supreme Court, and that a suit which started in 1938 will be toughly fought in 1947. It was on July 20, 1938 that the United States Government, after a legal reconnaissance of the film industry, filed suit under the anti-trust laws in an effort to end allegedly monopolistic practices. Big 5 in Protest Five of the defendants — Loew's (MGM), Paramount, RKO, 20th Century-Fox, Warner Bros. — who had a common ground in the ownership of theatres — almost immediately grouped themselves together and became known as the Big 5. After protracted litigation they agreed with the Government to revise their trade practices, an agreement which was filed on Oct. 29, 1940 and became a consent decree on Nov. 21 of the same year. The remaining three defendants — Columbia, Universal and United Artists — christened the Little 3 — refused to have any part of this agreement. The consenting five, under the terms of the agreement, approved by the statutory court, abolished block-booking in favor of selling in groups of five and provided against blind-buying by setting up trade screenings at which exhibitors might see what they were going to try to buy. Columbia and Universal — two of the Little 3 — continued to sell a season's product at a time while United Artists claimed that since it had always sold pictures singly and not in blocks, the Government's complaint against block booking could not apply to it. After a trial period the Government, con (Continued on Page 20) Critics Pick 'Best' Samuel Goldwyn's "The Best Years of Our Lives" was selected as the best picture of 1946 this week by the New York newspaper Film Critics, who also voted William Wyler the best director for his work in connection with that picture. The Goldwyn opus won over "Henry V" and "Stairway to Heaven," both British made, with Wyler nosing out the directors of both British pictures for his directorial work. Frank Capra was also high on the list of directors for his direction of "It's a Wonderful Life." "Open City" (Italian) won over "The Well-Digger's Daughter" (French) as the best foreign-language picture. Celia Johnson, 'British actress won the acting honors for her work in "Brief Encounter" with Oliva de Havilland runner up for her work in "To Each His Own."