Variety (Jun 1935)

Wednesday, June 5, 1935 PICT E $ VARIETY INT. PROD. A MUST-SCHENCK Treasury Dept. Suspicious of 10% Amus. Tax Holdouts; Urges Probe Washington, June 4. Broadscale Investigation Into sus- pected evasion of admission taxes ■was contemplated' by tlie Treasury Department last week as Congress wrangled over continuance oC this- and other nuisance levies which go out oC effect next month. Lacking adequate force to carry on the proposed probe. Treasury entered a formal appUcation for a graTit of 514,500,000 from President Koosevclt's $4,000,000,000 work-relief bankroll with which to finance widespread sleuthing. "Would look Into reported holding out of other e.xcise levies. Twenty metropolitan areas have been listed as the scene of the snooping, the group, including Kew York, Buffitlo, Chicago, Wash- ington,- Boston, Philadelphia, Pitts- burgh, Detroit, San Francisco, Los Angeles, Cleveland, Cincinnati, St. Louis, Kansas City, Baltimore, Milwaukee, New Orleans, Minneap- olis, Newark and Seattle. Just what Congress will do about the admlsh tax, which expires at the end of the present month along ■with a score more levies originally Imposed In 1932 for a two-year pe- riod; remains to be seen, but pres- sure is being exerted on behalf of the Treasury for another one-year continuance. Substantial opposition has appeared against the gasoline levy and miscellaneous sales Im- posts, but so far there has been no evidence of an Important movement against the box office top. The Treasury and_ legislative leaders both regard the 10% ad- missions tax as relatively painless and extremely simple to collect, de- .spite the present suspicion that many persons liable for this levy have been holding out, and will not Htand for abandonment without a fight. Action on a new tax bill Is anticipated later In the week, in the hope of action before the Industrial Recovery Act, In which the Imposts were Included two years ago, dies on June 16. FOX AT 2-YEAR PEAK, WITH 10 PIX GRINDING Hollywood, June 4. Fox records a two-year produc- tion «hlgh this week with 10 com- panies working between the West- wood and Western lots. Studio has had a lull for three months, but In- dications are that all available stages will be working for at least eight weeks to come. Pictures In production are 'Curly Top,' Shirley Temple; 'Way Down East,' Janet Gaynor; 'Steamboat 'Round the Bend," Will Rogers; 'Welcome Home"; 'The Dressmaker"; 'Here's to Romance'; 'Thunder in the Nlghf; 'The Lord's Referee"; 'The Gay Deception,' and the Span- ish version of 'Free and Easy.' JOHN MAXWELL IN U. S. Once-Over Among Other Things—Fox-GB? John Maxwell, prez of British International, arrived In New York yesterday afternoon (Tuesday) to look over the American market as regards his. film, and from a dis- tribution standpoint. Another thing Maxwell has in mind, and wlilch he Isn't tallcing about one way or the other, is a po.ssible deal with Fox. Understood that he started negotiations that way from aboard ."ihlp before landing in New York, Wliat Maxwell would like. It Is understood. Is to buy up Fox's 49% interest In Caumont- British. Not quite clear why Maxwell wants these shares, cxcopt that he has been trying to cffocl a merger with 0-B for some lime. Schenck for Lichtman It Is believed Joe Schenck may retain his interest in UA distribution company if for no other reason than to help elect Al Lichtman president, should his strength in that direction become necessary. As presi- dent Schenck got $100,000 a year, plus a percentage of .profits. UA's cash reserve position is claimed to be between $3,000,- 000 and $4,000,000 now. s Prod. Boom, 9 Pictures Go Into the Works Hollywood, June 4. Universal will go Into a produc- tion spurt June 10 that will put nine pictures before cameras for the next three weeks. Schedule calls for starting of 'Magnificent Obsession,' to be di- rected by John Stahl; 'Unconscious,' a comedy feature with Zazu Pitts and Hugh O'Connell, directed by Kurt Neumann, and 'Storm Over the Andes," directed by Christy Cabanne and-co-featuring Jack-Holt and Nils Asther. 'Her Excellency, the Governor' Is set for June 17. Three days later, 'King Solomon of Broadway,' a Julius Bernhelm production, di- rected by._AJan Crosland, is slated. June 27 a second Pltts-O'Connell picture, 'G Woman,' satirizing the G men will start, with William Nigh directing. July 1 calls for starting 'While the Crowd Cheers,' a football picture to be supervised by Maurice Plvar; 'Yellowstone,' mystery from original by Arthur Phillips; 'Fast and Furi- ous,' auto racer to star Jack Oakle, directed by Edward Laemmie and supervised by Eddie Grainger, and 'Stormy,' a wild horse musical oper- etta to be directed by Louis Fried- lander. ^OIH-FOX AS UA Joe Schenck in London Speaks of International Production Plans — Stays with UA Theatres and Expanding Same Abroad KORDA STAYS UA London, June 4. Making- his first detailed state- ment on the United Artists situation since the 20th Century-Fox merger, Joseph M. Schenck, who Just arrived here, said he had no intentions of completely quitting UA. He Is severing relations with the UA producing-dlstrlbuting unit, he said, but will retain his Interest in the UA Theatre corporation of which,, he says, he Is still the biggest share- holder. Schenck says he will retain a di- rector's post In the UA distributing corporation, even with the new aetr up. Will sail from here on June 15 and Immediately on his return to New York a new chairman for UA win be named. UA's distributing corp. has just purchased a strong financial inter- est in the Deutsch and Donada cir- cuits in England, which comprise about 150 cinemas. That is the deal which brought Schenck here at this time, he says. Film houses will con- tinue under the same Independent managements as heretofore, he says, thereby preventing the Kinemato- graph Renters' Society from object- ing and at the same time preventing either Gaumont-Brltlsh or British International from acquhing the theatres and creating a possible monopoly here against U. S. com- panies. Not yet certain whether the two circuits win be merged or allowed to continue as separate units but In either case they will retain their in- dividual- Identities and manage- ments. Alexander Korda's London Films and British & Dominions Pictures, Schenck says, will continue with United Artists as local producng units, despite stories of their break- ing away. That, at any rate. Is true, he says, for some months, both companies having UA contracts. Schenck denies that Fox Is try- ing to purchase control of Gaumont- (Contlnued on page EO) New Financial Setup of Fox-20th Merger; 7-Year Contracts to Kent, Schenck; Lasky Will Quit Oct. 1 GovL's Merger OK Joe Schenck in a cabled story from London in this i-s- sue deprecates the Fox-.Metro merger talk on the angle of a Sherman anti-trust law nix. Schenck .states that before anything was done about the Fox-20th Century deal ho first consulted Washington. Think Govt. May Stymie Mergers Via Trust Laws Many film men think the sudden voiding of the NRA may result in a tightening up anti-trust enforce- ment. They see this as a tough ob- stacle to any contemplated film company mergers or consolidations. With the NRA out of the picture many believe that the administra- tion will make it difficult for mergers through the anti-trust laws. Film men point out that picture companies today, in addition to pro- duction, distribution and exhibition, produce their own plays and prac- tically control the bulk of the- mu- sic publishing biz. So they're won- dering about the future of consoli- dation efforts. 2 NEW WHITNEY TINTS FOR RADIO RELEASE Hollywood, June 4. Jock 'Whitney's Pioneer company will make two features in the Tech- nicolor three-component process for new Radio program. Deal will keep Merlan C. Cooper at Pioneer's pro- duction reins. Currently Cooper Is producing 'Last Days of Pompeii' under the Whitney banner for Ra- dio. These, with 'Becky Sharpe,' will make four pastels for Radio from the Whitney group. UCHTMAN UA PREZ, GOLDWYN BOARD CHAIRMAN; NOT LOADING UP WITH PIX Hollywood, June 4. With arrival of Al Lichtman and Hal Horne from the East, United Artists' member-owners held Its first session at Pickfair until an early hour Tuesday (4) morning, with Lichtman In attendance. Earlier in the day Sam Goldwyn, -Mary Plckford and Charlie Chaplin met alone, reputedly for the pur- Iiose of working out of a financial propo.sition for Lichtman to head United Artists In place of Joseph M. Schenck. It was decided at the evening session that no announce- ments of plans be made until the stockholders' meeting in New York June 20, when Lichtman In all like- lihood take.s Schcnck's post and Goldwyn steps In as chairman of the board of dircctor.s. To date no 'official' word of Schcnck's rcsi,i,'n.ation lifts been re- ceived here. Only one with wliom .Schenck romniunlcaled before sail- ing was Lichtman who he called to .say goojbye. No propo.sition ha.s been made in- viting outside producers into or- >,'anl-/allon yet as It's felt that the current crnp of pictures on h'uu) puts the company In the best re- leasing condition in the history of the organization. UA has two Brit- ish & Dominions 'Escape Me Never' and 'Nell Gwynn'; two Kordas, 'Sanders of the River' and H. G. Wells" 'Hundred Years From Now'; 'Call of the Wild,' final 20th Cen- tury release in August; 'Dark Angel' (Goldwyn) for August, and the Eddie Cantor picture (also Gold- wyn) in October. Chaplin Is due the end of Augu.st and 'Am.ateur Girl' and 'Melody Lingers On' (Reliance), with 'Last of Mobican.s,' final of the three I'o- lianci; pictures on current contracts, with po.ssibillty they will renew with Hf'llunre for six more next year. J..iclumun and Horne to remain here until June 15, setting cam- paign.s on coming product from Coast and return to Now York prob- ably with the other throe, and Oouk l''airbanl<s or his repre»icnlalive for the .st'icUlioldors meeting. f'f>mpany will hold It.s r;oriventlon in Now York latter part of July. r,lf;hlman left .'Jalurday (1) by plane for Hollywood to be pres- ent at Monday's (3) mooting of UA owners and ofllcial.s. At the time, it appeared more than likely that Sam Goldwyn would become chairman of the board, because a heavier production .schedule of hl.s own than over before wouldn't af- ford him the time'to an office such as the presidency demands. This includes all administration and distribution activity, plus Hays' matters in which UA figures. In .Sclienck'f) absence from New York. 7>icht .-in li.'is .-ictf'd In his b(-balf in all thf'so diroclions, wllh wide Ijowors of discrol ion, H;iys' or^an- inalion is s;nd to favor Liclitman. .Muf:h ilfjjonds on (Johlwyn's at- titude, with Ch<-j.r)lin, I'ifUfoivl and J'',airl)anl<s, who vote wilh him. One prob;ibllily l.s that C:ii;i[)lin may l.'ike n.n (-xocutivc li;iiid actively in r'jiitcd Artists In tlit; future. In just what way ho miKbt figure, if willing, Is far from d'-finilc. .Mosltowit/C, who holds a vice lircsiih-nl's -^^ title in UA, rfni.'iins witli the ompaiiy, but since he lias boon HO closely allied with .S'-l.onfl{ (C'ondnuf'd on p;ifre 51) Fox Film gets a new deal by merging interests with 20th Cen- tury, according to downtown bank- ers. Sidney R. Kent, as now, will be boss over all. The company will be recapitalized in giving financial effect to the merger. Kent gets a new 7-year contract as president. Joseph M. Schenck, who will bs- chairman of the new Fox board and Coast executive for the company, gets a 7-year contract also. Schcnck's annual salary will bo around $100,000. The company's outstanding 2,500,- 000 aggregate amount of shares of 'A' and 'B' common will be recapi- talized on a basis of around $40,- 000,000 of new convertible preferred aggregating around 1,250,000 shares, paying $1.50 per share annually, aiid around 1,250,000 shares of new com- mon, of no par value. The preferred la. convertible Into new common at the rate of ona share of preferred for IVi i;hares of new common. Present Fox Film shareholders will receive. It Is fig- ured, % share of preferred and Vt, iihare of new common for each sharo of common presently held. Chase Bank and General Theatres Equipment own the majority of Fox Film stock. Fox's New Stars By the merger. Fox Film acquires all - of the assets of 20th Century. Besides the manpower, as repre- sented in the persons of Darryl Zanuck and Joseph M. Schenck, Fox Film acquires all directorial talent, stars and players who ar& under contract at the present tima to 20th Century. Counted among such players are Fredrlc March, Loretta Youn^if -ic.vl' TUxnald Colman. Whether Constance Bennett also la In this category of player."! cannot be stated. Fox may also get George Arllss for one film because of past affiliations, but Arllss so far is a free agent for America. This Is additional' to $3,000,000 to $4,000,000. In cash which It la estimated Fox will receive from the liquidation of 20th Century's pres- ent Interest In films which are In circulation. Twentieth Century gets 100,009 shares of preferred and 600,000 shares of new common. Darryl Zanuck becomes a vice-president of Fox. Besides Schenck, 20th Cen- tury may name William Goeta as a representative on the new Fox Board, havlngthree such represent- atlvs all told. The new Fox board will comprise 12 directors. The amalgamation means no changes at Fox, other than those which may come In the natural course of activity. Winnie Sheehan stays as top production man, being vice-president In charge of produc- tion. Jesse L. Lasky, alone Is expected (Continued on page 53) LAEMMLE TO VIENNA; MAY PRODUCE THERE Vienna, June 4, Carl Laemmie Is planning to visit Vienna again this Hummer. Re- ported here thp.t he i» coming with tho Intention of starting produc- tion here. Laemmie was In Vienna during the film festival weeks last year, and was received on that occasion by the late Chancellor Dollfuss. After that visit the Universal pro- duction 'Cslbi' was made hero. Universal is the only American film comijany now active r>ioduc- tionally In JOurope, having a unit ).t work constantly In Burlapo.st. ITollywood, June 4. Carl Laominic (leparl'>d l.ist .Sun- day (2) for the Chicago Universal ^-li'-s ijijv.'-wow. .r.-Hk i:.--ss U ('lit il|lil,ll,'. noxt (liy