To prohibit and to prevent the trade practices known as "compulsory block-booking" and "blind selling" of motion-picture films in interstate and foreign commerce (1939)

14 TRADE PRACTICES IN MOTION-PICTURE INDUSTRY in order to defeat a similar cancelation privilege provided in the N. E. A. code. Any right of cancelation after a film has been released is a poor substitute for the power of selection at the time the exhibitor leases his films, because (a) natural human inertia is against changing that which has once been done, (b) cancelation is ineffective unless the exhibitor can freely contract for additional good pictures individually or in small groups to replace the poor ones canceled, and (o) an exhibitor could exclude only unwanted pictures and could not fully open his screen to desired pictures and to independent productions. Finally, the cancelation privilege could not be exercised by the exhibitor as he saw fit, except in the lowest price bracket, in which the 'cheaters" would be found. It could only be exercised proportionately in the higher price brackets even though an undue proportion of undesirable pictures were allocated to those brackets. (2) In addition to the foregoing limited cancelation privilege, the major companies would permit an exhibitor to exclude from his contract "any feature which may be locally offensive on moral, religious, or racial grounds." However, this privilege would have to be exercised within 2 weeks after the completion of the first exhibition of the picture in the "exchange territory" in which the exhibitor was located.22 Thus local exhibitors would have to keep a check on exhibitions in theaters in their own State and frequently in surrounding States. If the distributor did not agree that a picture was locally offensive, the question would have to be determined by an arbitration board 23 located in the film-exchange center for the territory. This makes impossible any effective action by local civic and welfare groups because (a) they would have no means of knowing whether a picture shown at a distant point was "locally offensive"; (6) assuming the local exhibitor agreed with them regarding a particular picture, they could not carry their fight to an arbitration board located possibly two or three hundred miles away; and finally (c), to force an open fight over a picture on the ground that it is offensive would advertise it all over the country and consequently do more harm than good. (3) The proposal to enable an exhibitor to get an outstanding picture without contracting for more additional pictures than he can handle would be exercisable under the following circumstances: (a) That the picture has created a natural and spontaneous national demand, and (b) that there is a spontaneous and natural public demand for the picture in the place where the theater desiring to secure it is located. After the exhibitor has convinced either the distributor or an arbitration board that both of these comprehensive conditions exist, he can procure the picture together with such number of additional pictures as may be requisite to fill up all of his remaining available playing time. It is apparent, therefore, that this privilege can be exercised only once, and as against only one distributor during the yearly contract period. The manner in which both compulsory block booking and blind selling are protected and perpetuated by the terms of these "concessions" is ample proof of the monopoly power exercised by the Big Eight. The St. Louis Post-Dispatch, April 11, 1939, commenting " The United States is divided into 31 exchange territories, hence the distances included in each— especially in the West— are very great. E.g., Minneapolis is the exchange center for Minnesota, North and South Dakota, and Northern Wisconsin. 23 At the time of the hearing no detailed plan of arbitration had been presented.