Variety (Dec 1933)

Tuesday, December 5, 1933 P I C ¥ E S VARIBTy 33 Text of Picture Code (Continued from page 30) It Bhall 1)0 doemod to be an unfair trade practice tor apy producer- or distributor to petiTilt the public exhibition of such motton picture prior to such date. PART 2. (a) It phall be deemed to b^ aii unfair trade practice for any producei: or dfa- trlbutbr, by any o(, Ita employees or. throu^ othct persons -Who have a direct or Indirect Intorest, whether flhanclal Or othervylset In any sticK producer or dlis- trlbutor, to knowingly and Intentionally, directly or indirectly Interfere with existing: relations between ah. outside or associated producer and 9. producer .or distributor, or to do anything to alienate or entice any Buch outside or associated -producer a,way trom a producer or, distributor, or . to do anything which would tend to create dis- cord or strife between such «uts|de or associated producer and a. producer or dls< tributor. or . foment dissension., between- them, for ' the purpose : of Inducing such outside or . associated producer to. breach or attempt to bt^ach any existing con- tracts between It and any iiroducer or dis- tributor, or to secure .a change In the terms and conditions of any existing con- tract- between any - such outside or asso- ciated producer and a producer or dls' tributor. (b) To effectuate the - foregoing, no pto- ducer or distributor ahfiU negotiate with or limHe any offer for or to any such outside or associated producer at any time - prior to sixty (60) dayq before the termination of. any existing agfeement between such out- side or associated prbdu'cier and any other producer oi* dlstrlbutoi*, or not prior to sixty. (fiOy days befoire the date . when sucb out- side or associated. producer shall fulfill its delivery cbmmltment to the. producer or dia-. tributor with whom it-lias oohtractual obli- gations, whichever date Is earlier. b.. DISTlilBUTORS. PART 1. No distributor shall threaten or: -coerce or; Intimidate any exhibitor to enter Into any > contract for the exhibition of mo- tion, pictures, or to pay higher film rentals "by the commission of any overt .act evi- dencing an Intontlon to build- or otherwise acquire a motion picture theatro for op- eration in competition with such exhibitor, but nothing in this ARTICLE shall in any way abridge the right of a producer or distributor in good faith to build, or- other- wise acqLUlre.' a motion picture theatre In' any- location-... • PART 2.. No distributor's employee shall 'u.ie his position with' the distributor', to' in- terfere with - the licensing, of motion pic- tures by- an exhibitor operating a theatre In competlt-lon with. a theatrti In which such, employee miiy have a direct or indirect lU' tercst, provided, however, that an em ployee-6f a distributor shall not be deemed to have an - interest ■ in 'any theatre af'' filiated with siich distributor. PART 3. ' (a) No. distributor, shall substitute f6r any- feature motion picture described in' the cohtradt therefor aa that of a'named Star.or stars or named director or named well-known author, book or play one of any other star, or stars, director, authoi-,- book. or play, nor shall such distributor .substitute any .otho'r feature; motion pic- ture for-one -which in. the. contract-therefor -Is'. designated 'no - /substitute! i and no .eX' liibltor shall be required to accept any such ' substitute motion picture. .(b) Nothing In this ARTICLE contained shall be interpreted to prohibit any dis- tributor from changing the title of any Rio-', tlon .picture contracted for, from .making obanges. alterations and adaptations of any story, book, or-play-upon -whioh it is based 'and from substituting - for. any such atory, book-or play another stoiT-, book, or play,, or from changing the director, the cast, .'of any member thereof of -any .such motion (tlctUre,. except as hereinabove spoclfl.cally prohibited. (c) If. for any such author, book or play itaero is substituted . another. author, book or play, - .notice of - aUch substitution shall 4)0 given by a paid advci'tlsoment of not Jess than one-quarter page |n at least one Issue of a national trade publication - be- fore tlM rcle.i.se' date of the motion plc-- ture- In which such substitution has been niadc. PART 4 (q-) It -shall be nn unfair - practice foi* a.ny dl.strlbctor to license the exhibition of its .motion, pictures "for. exhibition by .any non-theatrical, account, - contrary, to any delermlnoilon, restriction or elimina- tion by- a' - local Grievance Board, where such exhibition shall be determined by such grievance board provided for in this code to be unfair to -on established motion picture theatre: <b) Nothing - in this PART shall be in- ■lerprctPd to prohibit the licensing Of mo- tion pictures for exhibition at army posts, «r canips, or on board ships of the United States Navy or ships .engaged in carrying passengers to foreign or domestic ports or 'kt educational or religious institutions -or at 'Institutions housing 'shutlns,' sucb as : prisons, hoMpItiil.s; orplianagcs, etc. ..-PART.S. -No distributor shall require as a condition of entering -Into a contract for the licensing of the exhibition of fea turo motion pictures that the. exhibitor contract ^Iso for the licensing of the-ex klbltton of a greater number of short sub Ject's (excepting news-reels) In proportion of the feature pictures for which fi, con- tract is negotiated bears to the total num- - Iter of feature pictures required by the •xhlbltor. PATIT 0. No" dlstrlbm w .BhttU di-vulge or - anthorize or knowingly permit . to be ^vulged 'by any employee or checker any tofoi-matlon' .received In the Checking of *ie. receipts of Its motion pictures,' except •>at such information may be divulged-in —ftny—ar-bliratlo.n or .gri evance proceeding •r litigation cohcernTng a confrover'ay and^ -tor any government or Code Authority Teport. ; vPART 7. No distributor- shall convey or tronsfor- Us assets for the pnrpese of mvoiaing the delivery to any exhibitor of ■ -•ny featur.o motion picture licensed- for Cshlbltion by such exMbltof, . PART 8. No distributor shall refuse to iMke. a fair adjustment of the Ilcoise- fees top the exhibition rights of a number of Jpictures licensed in a group for a stated ajverage sum . per picture and so stated' in the .license agreement; if. the total number of plctiires ' BO licensed .by any exhibitor _ «re. n^t- delivered by such distributor; pro- ▼lidea Bucir~exhlbltor sh.ill have fully and completely performed all the terms' arid yondltions' of such license on the part of. the. exhibitor to be performed. Any dis- pute or controversy 'concerning any such adjustment shnll be determined by a toaal crlcvance board provided for In this cole PART 9. . (a) No dlRtribiitor shall require any kpeclflc day-or days Of the wenk for the exhibition of specined pictures or rlass of pictures unless spoclflcally provided for tn =Jlie--;^exhlbitOcia.=.eontra.ct—t herefor- -and. Jn no event if Ihc llconso fee therefor la ."a" Wxed sum only. (b) "Wihere under tin exhibit Ion rontraot which provliloa that tbe rental to be paid by the exhibitor for any feature motion picture spcclfloa therein shall be deter- mined In whole or in part upop a percen- lago ba-ils and that said picture ehail.be l>Iayed by the exhibitor upon a designated that the subject and character of. the mo- tion picture - BO ' designated are -unsuitable for exhibition at the Exhibitor's theatre on such day or days, the claim of the: ext Mbltor shall be determined by the .local grievance board provided for by this code, and the dL^trlbutof, if such local board so determines, shall relieve the. exhibitor from fbe.'Obllgo,tlon: to play- the motion picture upon the day or days designated by the distributor; provided that the exblbiltor makes Buch claim within, three (3) days' lifter. receipt of the notice of avallablUty of such feature picture; In such cases the isaid local. board - shall proceed . to de- termine the matter upon forty-eiglit (48) hours' notice if the distributor SO desire's. . (c).,. If the said local board shall sustain tl>e claim of the exhibitor: - (l) :th« distributor shall, have the right to designate for 'the.-same' day or dates another motion picture; .Ucehsei)'- upon' a percentage basis, upon the sanie or similar terms as the motion'picture In question, if there be one. licensed; and to designate the motion picture objected to for a later date or dates biit upon another day or other days of the wcerf; and (2) the ^ward of the said local board. shall not be deemed to apply to any other theatre in the same or any other' location; (d) Where because of a proceeding be- fore a local grievance board,' or because of an award of such local board, it shall be .impractlca:! to'serve subsequent-run' ex- hibitors In compliance with any notice of availability or confirmed play dates'given any. ^uch subsequent-run exhibitors, the distributor shall haiys the right to change such plajr- dates^ ' PART. 10. No distributor shall refuse to deliver to any exhibitor any feature mo- tion .picture llcens^ under .an exhibition contract therefor because of siicb exhib- itor's default < in the performance of dny ekbibition contract licensing the exhibition of short. subjects of ■ such distributor, or Vice "versa, provided, such exhibitor has agt-eed to." arbitrate all' claims and- con-' troversies arising tinder all existing Op- tional Standard . License . Agreements be- tween them. PAiitT li. ' . (a) If any exhibitor has contracted to exhibit more than fifty percent (60%) of the total number of mbtlon. pictures - an- nounced for release'.during any. given isea-- son by a distributor iand such distributor shall during such , season generally- release any feature motion., picture .in addition tO' the. number so announced, such dis- tributor shall first offer to the exhibitor for license such additional motion pictures for exhibition at the exhlbltorls theatre, pro- vided that at the time of such offer sucli exhibitor shall have duly performed all the terms and conditions of all "existing ex- hibition contracts between such exhibitor and distributor and is. nojt iii default there- under. (b) In cases where two exhibitors have each contracted.'to exhibit, respectively, an equal division (I.e.,-60%) of the number Of motion pictures ■ announced for release by a distributor during any given season, And the distributor shall generally release during such season any feature - motion picture in addition to the number so an- nounced, such distributor shall first otter: such additional motion picture for license to. one of such, exhibitors.-. In the discretion of the distributor, provided that at the time of such offer such exhibitor shall have duly performed all the terms and conditions, of all existing exhibition con- tracts between such, exhibitor, and dis- tributor and is not in default, thereunder. ^ PART-12. In each territory -wherein any distributor -maintains an exchange; such distributor shall abid^ by the regulations promulgated by the Code Authority for the prevention of fire, for the holding Of fire drills, and rigid • monthly inspections; t-he inspection of prints, the storing of inflam- mable material, the maintenance and' test- ing of sprinkler systems and fire ex- tinguishers, the avoidance of smoking and' other cautions, methods and devices to protect- the lives of employees and the publlo and to insure safety aga:inBt lire hazards. < E. EXHIBITORS. PART 1. Any exhibitor entering into a contract for the exhibition-of motion pic- tures which permits the exhibitor to select from the total number of pictures licensed less than eighty-five per cent (8D%) of tbo total number, and to reject the remainder. Shall by written notice to the distributor reject each- of siich motion pictures not to exceftd the number which may be rejected, within twenty-one (21) days after its date of availability in the exchange terri- tory wherein Is located the exhibitor's the- atre,, and upon the exhibitor's falling to give such notice of rejection, each of such pictures shall be deemed to have been se- lected. . PART 2. No exhibitor shall contract fOr a license to exhibit more motion plctures- than such exhibitor reasonably shall re- quire for exhibition in any theatre or the- atres operated by duch exhilbtor; with the Intent'or effect of-dcprl-vlrig a compptihg exhibitor-from contracting to: exhibit such excess number of motion pictures, provided; however, that nothing. herein contained shall be deemed to prohibit any exhibitor from contracting for a reasonable number of motion pictures In excess of the number' which are actually to be exhibited in the theatre or theatres of such exhibitor In or- der to reasonably protect such exhibitor agralnsf non-dollvcry of motion pictures." PART fl. Section 1. No exhibitor shall (a) lo'Wei' the admis- sion prices, publicly announced or adver- tised for his theatre by giving, rebates In' the form of lotteries, prizes. - reduced sdrip books, coupons, throw-away ;tlckets, or by two-for-ono admissions, or by other meth- od fl or. devices of similar nature .which-dt- refftjy Or "l-ndlfectly—loWor-Tji^t-end-tO-low.cr. such announced admission prices and which' are Unfair tb 'competlng oxhlbltom, or wblch- dcceive.-the ptibilc; or: (b)- fall at all times ;'to matnte.ln the -minimum price , of admis- sion specified in any -contract licensing- the exhlbltl'on of any moton picture during the exhibition thereof./ This Section shair not be deemed to prohibit, exhibltois - from re- duclng or increaslri^r .their' admission' scales as they see flt, exCcpt as .may bo prohibited by exhibition contracts. . Sectloij. 2; The giving of debates such as premiums'in the. form':of gifts or. other things'Of value-Shalt .be-deemed'.to be In- cluded within the provlslon.s-of Section 1 of local grievance bofird shall bavo power to direct that distributors of motton pictures shall refuse to enter into license contracts for the exhibition of. their respective mo- tion pictures to sncta exhibitor ' and shall refuse to mahQ further deliveries of niotion pictures to sncta exhibitor under license agreements executed after the effective date of this code If the exhibitor fails or refuses to so create and desist. - Section 4. . Notwithstanding any action .which may be taken by the exhibitors In .any area as aboVe in this Part 8 defined, ruling out the giving 6f rebates as defined in Section I hereof., .such .ruling shall, not become effective until ninety (90) days, after such action oh the part of such' exhibitor as aforesaid. ' PART i. No exhibitor sball transfer the ownership or possession of a theatre or.tho^ atres. operated by any such exhibitor for the purpose of avoiding uncompleted . con- tracts.-for the exhibition. of motion pictures Sit', such theatre or theatres. Any disputes or 'controversies with rcSpect to any trans- fer shall be. submitted to and determined by. a local grievance board, and the finding of suc'h ':board shall be binding upon all par'- ties concerned. PART B.. ;(a)' No . :exhibitor licensed . to., exhibit, a motion picture subsequent'to its exhibition by another'exhibitor having the. right to 'a- prloir run thereof shall advertlse'.such mo- tion picture by' any means - of' advertising prior to. or during its exhibition by such other exhibitor. (it) Notwithstanding, anything hetoln'con- tained, in the'- event any' exhibitor shall make', complaint that .the restrictions .em- braced . ln this' PART work'an unfair :hard-. ship-on him, .tbe.loc&l grievance board shall have, the rlght'to hear- such complaint,', and after. .determination of the facts presented shall'fix and specify the time limit within whlOh such exhibitor may advertise' such motloh picture; provided, however, that should the subsequent run exhibitor be granted, permission to. advertise-before the completion of said: prior run, he shall'not, advertise prior to the commencement of said prior ruri, nor shall he have the right to advertise in any "way, -shape, manner or form, or issue any statement that the prices of admission are or. will 'be.. Icsa than the admifikslon prices charged- by the exhibitor, having the first or prior run of such mo- tion picture; -provided further, '.however, that such: subsequent-run ei^blbltor may bo' granted the right in cases where the run of sitch exhibitor follows the prior nih' in or within a period of seven (7). days, to ad- vertise upon'the screen of .the exhibitor or to distribute within the exhibltorls theatre a'.printed program or niiall such printed pro- gram: to a list .of regular patrons," such -pro-: grrams. to be- limited to announcement - of the motion plcturcE^-wbicb will be there ex- hibited during the period of not more than seven (7) days immediately following.. (c) Nothing beretn contained shall be deemed to prohibit' any exhibitor from od-^ vertlslng generally all of the feature motion pictures licensed for exhibition by such ex- hibitor as a group, but such general ad- vertising shall not refer to any one of such motion pictures at any time prior to Its ex- hibition by any other exhibitor having the first or immediately prior .run thereof ex- cepting as hereinabove provided. PART, 6. To prevent disturbance of the continued possession of a theatre by an exr hibltor, it shall be> an Unfair: trade practice for any person engaged In the motion pic- ture Industry knowingly and intentionally, directly or indirectly,' to interfere with pending negotiations, between such exhibitor and any other party pertaining t<^ or affect- ing the possession, operiittion or occupancy of any such theatre then actually operated by such exhibitor, or in respect of any modification, renewal or extension of any agreement affecting the same, for the pur- pose of preventing the .consummation of such negotiations so as to deprive siich ex- hibitor-of the'continued operation, posses- slon, or occupancy of such theatre.' PART 7. No exhibitor shaU exhibit a motion picture , pre-vlous to dawn of the first licensed and. booked day of exhibition without securing express written permis- sion therefor under the.license-agreement.< F. DISTRIBUTORS-EXHIBITORS. PART 1. The soicnllod Optional Stand ard License Agreement (19S8) negotiated by exhibitors and now being: used by a largo number of distributors; shall be the form of license contract to be used by.distrib- utors for licensing the exblbltioh of motion pictures, unless the parties mutually agree that a different form bo used, and except- ing that in. case eny condition or provision thereof is in conflict or Inconsistent with any provision of this code, such condition or provision of said Optional Standard License Agreement shall, be deemed amend- ed to conform with such provision of this code, it heinr the Intention that the provi- sions of this code: shall govern. . Individual distributor sales policy provisions may be Inserted in the schedule of suoh form, but shall not be contradictory of any provisions thereof. PART 2. (a) The arbitration of all disputes be- tween exhibitors and distributors arising under any exUbltton contract, if the par- ties shall agree on. arbitration, shall be In accordance with the optional arbitration clause of the so-called Optional Standard License Agreement, provided for in this code, except as the provislons'of auch claiise may be modified by the provisions of this <!ode. . . - (b) By stipulation of the parties to any dispute growing out of an exhibition con- tract, the number of arbitrators to bo ap- pointed by each party may be reduced , to one, with power in the two thus appointed,- if they cannot agree upon an award, to ap- point an umpire aa provided in said op- tional-arbitration clause. - . .. PART 8. No exhibitor or distributor shall induce or seek to induce the breach of any subslstlnig contract licensing tbe ex- .hibltlon' of motion .'-pictures.' PART 4. No exhibitor or distributor shall give any gratuity or make any offer (If - any gratuity for .the puippse of procur- ing advantages that would not. otherwise be procurable, or as an in ducement to- In- "Su^nce a aistributor or exBlbrtWTnsfrreprcs- sentatlve of either, not to deal with any competing or other exhibitors, or dlstrlbu- torsi •' PART G;- no exhibitor or distributor ithall'make-any disclosure of -box-office re- celp.ts for- publication except, necessary re- ])orts to . etoickholders, 'credit and- govern- mental agencies ■ and to other. Iih'e;!bOdles.'v .No exhibitor:. or distributor shall be re- sponsible for dlscl'dsiires' in -Violation'of this PART inade by: agents not authorized to 'do no, demned by bach local CTcaranco and .Orlev ance boJ^rd, where the exhibitors operating not less than seventy-11 ve per ccrit (70%) of the number of the then actively and con- tinuously operated theatres not affiliated with dlstribtitors or producers and the ex- hlbltoi-s operating not less thah seventy-five per cent (75%) of the number of the then actively and continuously operated theatres affiliated with distributors and: producers have both declared in writing that the, glv- I'lg. of rebates in such form shall not: bo 'p»riffIltear^Ft>r-^he^uri)ose=of=»uch-decia'^ ration each.exhibitor shall bo entitled, to one'vote for each theatre, then actively and continuously operated by such exhibitor. flection 3. In case any exhibitor is found after notice and bearing by a local griev- ance board provided for In this code, to have violated any provision of tnle PART, .and if such local board shall on account thereof declare that such exhibitor shall Way or df^ys of the week and the exhibitor , . — ^—,; ««kiwih„„ Mccks to be relieved from the obligation to not be permitted, toJlceJise exhibition -^vblWt su6h motion picture upon "Ufli 1»ny. ^notion picture unicM the m^^^^^^^ exhibitor Is sej^e^^^ -l-'-'ltmat.ed dnv or dnvs for ihO resFon only ^ce.ises- .inO ir">\<-tfi from ^'irh -lol^itoft. th' c '-) ! n** 'TTi.ifi'.for PART. 8, . (a) If. in aiiy . license agreement for the thTs'^Ari TlOLE ijn-t^ areas as shall bc4-«t*:|biti<in.-o£...feattii». mo^ exhibitor has: contracted to exhibit all of l.tae . motion pictures, offered-at one time by the distributor ta .the exhibitor and the license fees of. all thereof avei-age not more Uian $250.00; the exhibitor shall have the privilege to -exclude :from such- license .agreement not to ekceed ten per .cent (10%) of tiie' total number- of the motion pictures no Uceiiscdi provided the exhibitor - - (1) is. not in default under 'sucli .license afOTcmeut; and (*2) shall have cbmplied with alt of the 0XBYlal2nE=:tM?5!*.*» Ji- *ny,_ for^the^ exhtbl-^ tlon of such motrbifi piClurb.s~at"speclfi?:d'"'Iir-- tcrvals'.- (b)' Such, privilege of exclusion may bo exercised only lipon th« following terms and conditions: ' (1) The exhibitor Shall give to the dis- tributor written notice of cacb mdtlon.pic^ ture to be excluded-within-fourteen (14) deyd after the general release date thereof In the exchange territory out of which the exhibitor Is served. . H. p.'jymcnt thorefor ono (1) motion pi-^ture of each group of leh (10) of ihf nuxnbor -of fcaturo motion pictures specified In., the leccnse agreement provided he has paid for the other nine (0) of such group, (3) If such privilege of exclusion is not exercised as provided in paragraph (b) i2) above, the exhibitor may nevenheless exer- cise -such privilege' by paying the license fee of each motion picture oxoludod With the notice-of Its exoluslon. In such case, siich ' payment shall be - credited against such tenth or succeeding tenth motion picture, OS the rase may be, which- the ex- hibitor would otherwise be prlvllogod-to ex- clude .as provided in paragraph (b) (2) ubovo. If tho-only or last group licensed. Is less than ten (10). and more than five (5) motion pictures, the privilege tq-exclude' shall ap- ply provided the exhibitor has paid .-for all motion pictures but one of such groUp. . (c). Upon the failure .or refusal of the exhibitor to comply with any term Or con- dition of such license :agreemen't,' or to com- ply with any arbitration award in respect thereto, the privilege .of exclusion forthwith' shall be revoked and .the-exhibitor siiall be liable'for and-: pay :t'o the dliitrlbutor the lIccnaiQ fees of all motion- pictures- thereto- fore excluded. ^ <d) . If the license, fee of .any feature mo-, tion. picture .spe6Iflcd in the license-agree-, merit is to be. computed iii-whole 'or in part upon a percentage of the-receipts- of the .ex-: hibitor's .theatre, such license fee (for the- purpose of computing the - a-verage. license fee- of all of the motion pictures' licensed), shall be - determined as follows: .. (1) Average the license fees of all of the distributor's feature motion pictures exblb-.. itod upon a tpercentage .basis .at- the ex- hibitor's theatre, during the period of brie year prior, to the term of-siich lleerise agree- ment. ;. (2) If none Of the distributor's feature motion pictures were exhibited ui>on a per-: centage - basis iat such , theatre, dutirig said period,. a.verago the license- fees of. .all fea- ture motion pictures exhibited upon'a per- centage - basis at such theatre diiririg .the said period.. (e) If the rental of any motion picture excluded is to bo computed-In whole, or-in part tipon- a- percentag'e.-'Of the receipts'!of thei exhibitor's theatre, the sum to be paid by the . exhibitor as provided .in paragraph (b) (8) hereof shall be determined as fol- lows: -' .' (1) -Average, the' -gross: receipts of all: the- distributor's feature --motion plctui-es - ex- hibited at the ieichlbltor's theatre during the ninety (00) day period preclding the ex- hibitor's notice of exclusion, and apply to sUch average the percentage terms specified in the license agreement: i:or, the picture ex- cluded. (2) If no feature motion plctuires. of ..the distributor were exhibited at the exhibitor's theatre during said'ninety (00) day period, average the dally-gross receipts of the-ex- hibitor's theatre for the. period 0f tbirty (30) operating days preceding, tbe -exhibit- or's notice of exclusion and apply to such average- the percentage terms , specified. In tho liccn'so agreement for the picture ex- cluded. (f) In computing the. number of feature motion pictures which .may be excluded hereunder, fractions of moiie than one-half (^i) Shall bo regarded as one (1). (g) -Upon.: the exclusion of each feature motion picture, the license therefoi* and all Tights thereunder .shall terminate and'shall- revert- to the distributor.- (b) The Optional Standard License Agree- ment referred- to in PART.1-hereof shall be deemed amended - by substituting In place, of Article. riFTEEN of such contract the provisions of this PART. AETiCLE 71 PAliT.-l. CLEARANCE AND ZONING BOARI>S. Section' L' To pro-vide -aga.inst clearance and unreasonable length and/or area in any exchange territory, fair. Just, reasonable and equitable - schedules of clearance .and zoning, riiay be proscribed by a loci^l clear< ahee and zoning board created for such ter* rltory. Section 2. Each sucli board shall be ap< pointed by the Code -Authority and shall consist of- t-wo representatives of distribu- tors, one of. Wbom shall be a . national dis- tributor.-with theatre affiliatidns and one of whom shall be a distributor without. circuit theatre affiliations; two -represeritatlvos of first-run theatres located in such' territory; one .of'Whom shall be'an afQIiated exhibi- tor, if there be one, arid one cif whom shall, be an unaffiliated exhibitor; and two rep- resentatives of subsequent-run unafflllatcd theatres' operating within such' territory; and one-person approved by the Admlnls-. trator who shall Jia-ve. no direct or Indirect afllliation with any branch of the motion picture Industry who shall be regarded'as the Impartial representative Of the Code Authority and who shall vote on any.ques^ tlon before the board only In the ease where the board Is deadlocked. There- shall be a chairman of . each bor^rd, selected by a majority vote of the members of the boat<d. Any vacancy in the board shall be Ulied from the: class of members in -which tho vacancy -occurred. -Section 8. Each local clearance and- ;;on- ing board -shall, promptly after its crea- tion, and prior , to January 1, 1934,. and prior- to January '1st -of each year . thereafter, formulate, prescribe and publish for its territory, .schedules of clearance as in Sec- tion 1 above described,- for the season .next ensuing. Such schedules may classify ther atres-by zones or other classiflcations suited to local conditions, - but for the sole purpose of fixing the maximum clearance in length of time and area after the conclusion of the prior runs of such theatres. E^aCh board may after fair, and reasonable, notice and hearing to interested parties onange, mod- ify or vary .any part of the schedule set up by. it, provided that any such change or modlflcatJon shall, not In any wise apply to, affect -or modify . any exhibitiori -coritriaict made subject to or in reliance upon or pur- suant, to any. such schedules, without the prior- written consent of, the parties to such contract; -' 8ectlon-4. —J!acb board-^when-maklng^ ahy- classlflcatlon of theatres or when flxiiig the maximum period or area of. clearancci in respect of any ..theatre-shall, among other things, consider and give due regard, to ttab following' factors: (a) . that clearance to'a vei*y considerable extent determines the'-rontal - value of mo- tion pictures; ' ' . (b) that exhibitions of the same motion pi.ctiire Within the sariie competitive area at too sbOrt .an' interval after tho cdncluBlon of: a preceding run or runs thereof by unduly restricting the competitive-area in which clearance is limited, depreciates the -rental, value of motion-pictures; .and ^ (c) that all such deprcclatiohs of the rental values of motion plcjtureii tend to re- duce the .number of motion pictures pro- duced; discourages the. production of .motion pictures of quality involving large-'.invest- ments ' of capital, labor, skill and ontcr- prise and - thereby tend to reduce cmploy-- nient; (d) that unreasonable clearance to a con- Hlde'rablo. extent affects the Value of motion pictures for subp.equcht-run theatres, (e) that tinreasonablo Clei;trance depre- ciates .the potential return from mbllon -TTlcturo.s^to-^subsequent-run^^theatr-Cs.i^s^.^ (f) that unroaiioriable. clearance aa .to tlri)'e arid area diminishes" the potential revenue to. dlalrlbutor an'd Subsequent-run e?chlbitor. Section 5. The de>lslon of each board upon any quesllnti -Rhall be determined by a majority- Voir?, but in caifie the board Is. evenly div|dr->), -hiicli irj'ic.itlon shall bo fluiimittU'1 f'li' <l('Lf>riillnnM(^n to the' im- ji'jrtiul rojiro.'iTiT.'ti.ivr^ of t^o Co'le Ati- H.fivity, •■■<' ' nf.i-i Jo,l for In >'o.-flon ,2 of this PART. Tho decision of the board and/or the Impartial representative, as tho ca-se-niay. be, shall be In writing. .Section-6. It shtvll be the duty of each euoii board to promptly publish- the sched- ules formulated by it. and file a copy thej-eof immediately with the. -Code Aui- thorlty* Section 7. (a) Any party aggrieved by liio .•tchcJiiles shall promptly and not later thah thirty (30) days after publication thereof, file a protest. In writing with tho board. Issuing them; Thereupon Such board shall prompt- ly convene and give' reasonable notice of hearing ' to all. i^artiea concerned or-having an interest in tho proceodlnga and hear them and accept- (ronv them all; papers and evidence. -The -board shall, have i>ower to make reasopable rules respecting notice of. tlte - time, place' and- inanner of hearing.- . The board shall make its decision within flfteen- (16) days from- the. filing of tho protest,-, or within three (3) days, aftei'vthe' parties shall have been fully- heard, which- ever date Is sooner. Any party.- aggrieved by the decision shall have the absolute right to appeal Ihereform to the " Code Authority, provided siicta 'appeal be .filed, or mailed by rcglst,ered mail o'r delivered in writing not later than fl^•B (5) days after -the- decision of tho local board .la rendered, Iti which case the protest, with all evidence taken before the local clear- ance and zoning board, shall be .'referred tO' the Code Authority. (b) Xll 'persons, interested in the deci- sion shall have the right :to appear, before the Codb Authority, and present additional evidence'. The ■ Code ' Authority, : after in-- vestlgating such'.protest' and reviewing, the evidence'' theretofore- taken, and cbrisiderlnet. the .. 'additional - evidence. If any,' shall proriiptly' render ''its decision, and noi later ' than fifteen (15) days from and after the- date of tho hearing, upon the: appeal. The roqutremerit as. to - the various. steps herein .prescribed shall bo mandatory in order to give f ull relief before - tho 'buylnB'' season commences. Section. 8, (a) The schedules presented .and/or deci- sions ' made. by any.. local clearance, and :;onlng' board and/or decisions, of the Code Authority upori' any. appeal to it, 'shall-:be ' binding upon all distributors arid exhibitors . In tho territory affected. (b) Pending tho' final determination of any di&pute or controversy;, al) existing, contracts between-.-the -disputants shall continue to bo performed in «very respect. .Section 9, Tbe Jurisdiction', of the local clearance and zoning board shall be limited as herein- specifically provided and .:8ucb board' -shall hear' no questions other- than' those pertaining., strictly to jelearance and zoning matters.. PART'2. GRiiEVANCE fiOABDS. Section 1. The complaint' of any exhib- itor-that a. competing e^shibitor-has-com- mitted, any of tho - acts set forth in tlie following paragraphs <a). (b), (c), and (d) with the Intention and effect of depriving, without Just cause, the complaining ex- hibitor of a' sufficient ntimber of motion pictures to operate such exhibitor's the- atre, shall be referred for determination tq a local grievance board constituted nS' hereinafter provided: (a) Tiie licensing of more motion pi tures than are reasonably required. (b) Tho adoption of an unfairly. comw peting operating..policy of unnecessary and too frequent changes of motion pictures. (c) "The exaction without Just cause of an agreement from any distributor as a condition for entering into a contract" for motion pictures that such' distributor re- frain' from licensing its motion'-i>icturcs to the complaining exhibltoir. (d) The commission of any other similar act with the intent and effect of .depriving without Just cause the complaining ex> hibltor : of a ' Buffioient'nutnbor of motion plotiiroa to operate such- exhibitor's theatre. Section 2. Each such complaint shall be In- writing and- made Imtnediately after the commlSRlon' of-the act' or' acts-com-- plained of, or in cases where an act. or acts Is threatened. Immediately after notice thereof, and tho local grievance board after a fair and impartial consideration of all of the facts presented,, a full, ..expeditious 'and complete 'hearing of all the parties con- cerned, including tho exhibitors directly in> volved. the distributors having contracts with the exhibitor compialnod against, arid exhibitors having contracts 'for runs sub* sequent to each of the exhibitors directly involved, and If it" deems it necessary,, an Independent investigation of the. facts, shall make a-proinpt determination of each complaint submitted to It.- Sectlon 8. The local grievance board shall determine whether or. not any ex- hibitor complained of has committed any of the acts speclfled in paragraphs (a), (b), (c) a-nd (d) of Section 1 of PART 2 hereof, and shall make findings of fact in such regard. Tho local grievance board upon the facts found shall make "an. award (a) dismissing the complaint, or (b) grant- ing such relief as the local board may deem appropriate. The local grievance board shall not have power to award damages. No award shall bo made in favor of a complaining exhibitor unlcHs the local grievance board shall find as a fact that the eomplalning exhibitor' is ablo, ready and willing to fully carry out and cbmply with all of the terms, and condi- tions, which may "be lUed' by the local grievance board, as a condition for' making the award, which terms arid conditions shall in no event be less favorable to the dis« tributor concerned than thoso contained in the license contract of the exhibitor complained of, including the distributor's loss of revenue. If Any, resulting from the elimination of pr reduction of revenue from any subsequent run or runs made nocest saiy by such award, end oUch other terms and cbttditlona aa the local grievance board inay prescribe. Bectloi^ 4. All complaints and grievances of exhiblters .-or distributors conoemirig provinlons of this code or otherwise, and not epoclflcally designated to be . lieard or passed upon in the first Instance by the Code AtithOrlty or by arbitration or by the looa-l-^learance- -and-zoning.^board;_BliaU_be_ heard by the local grievance board, and if Mich local:board by a majority vote of the representatives thereon, shall deem -. that any- such 'complaint or grlovance' shall be certified to-the Code Authority for determ- ination, it shall bo so certified, and tho Code Authority shall consider and dotermlne. the same; otherwise such complaint or grievance-shall bo dismissed -with a right- of appeal from such dismissal to the Code- Authority. Such proceedings before-the local. grievance board and before the Code ' Authority shall be within the periods - Of tlmo hereinafter prescribed in Sectloris 0 arid' 7 thereof. -.: Section 6> Each -distributor shall ha'f^ the right to Ilceriso all or any number of the motion pictures distributed by such distributor for: exhibition at theatres af- filiated with- such distributor, and no local grievance board shall havo Jurisdiction to hear or dctennlno any complaint by any ex- hibitor based .upon, the fact that a dis- tributor' has Ilc.onsod the motion' picture.*) distributed by it for exhibition at theatres affiliated with such distributor. Section 0. (a) There 6hall be established a local =gTievance=boardr^appolnted=by=tho=Cod6*=^ Authority, .'in each exobangd- territory.. Each such board shall consist of two- rep- resentatives of distributors, one of whom shall be a national distributor with theati^e anillatlons. and one of whom shall be t, OlHtrlbutor without circuit theatre affiUa* tlons, and two representatives of exhibit- ors; one of "whom ishali be an afilUatod ex- hl.ljitor, if . there bo one, and one of -whom '^Cpntimiod .on pncrc -iiTi