Variety (Jul 1937)

Wednesday, July 7, 1937 PICTURES VARIETY ^OWN 5-YEAR in By 77b Trustees Vs. Par's Officers Paramount stands to get several millions out of setting its long de- layed suits started imder the 77b regime of the trustees against for- mer officers and directors of the company, and which suits are still pending in N. Y. supreme court. This is the home office estimate of the situation with the revelation that Root, Clark, Buckner & Ballan- tine, counsel to the former trustees and still in charge of the hangover litigation, are considering such an out-of-coUrt settlement. ■ The suits are an outgrbwth of the old-time bonus and stock purchase Plans of the firm. Adolph Zukor, Austin Keouijhi Jesse L. Lasky, Sam Katz and certain members of Kuhn, Loeb and the Hallgarteh Co. are amobg other -defendants in the Presumably were such a settle- m.€nt negotiated the various de- fendants in the litigation Would set- tle u p 6 h individually agreed amounts. There is no indication on how far the proposed settlement has gone. These suits were figured for trial this fall. Bickley's RKO Pk Test Tony ickley, roadway legit player, is being screen-tested in RKO's 'Annapolis Salute,' now be- fore the cameras at the U. S. Naval Academy. Miriam Howell, of the Leland Hay ward office, set Bickley in a small part i the pic. RKO has an option on him and will lift it if he looks to have tlie goods. Bob Sisk is producing and . Christy Cabanne directing. Loniit Product Peals Woulil Circumvent C o n s t a ntly Adyancing % Fix De- mands ^ Studios Putting Pressure bn Their Distri- bution Deptsi FILMS' MOUNTING COSTS ABOUT THAT Mayer To Inaugurate MG . Hoilywood, July 6: Louis Mayer leaves Thursday (8) for New fork, and sails July 14 aboard the Normandie for London to inaugurate British production for Metro. > Accornpanying Mayer are Benny Thau, Howard Strickling and John Zanift, the agent Michael Balcoii will remain in tioUywood until scripts for the London shooting schedules, carded to commence on Aug, 15, are completed by writers here. The first picture Metro will make abroad will be 'Yank at Oxford,' di- rected by Jack Conway, with Balcon supervising on the scene. Robert Taylor and Maureen O'SuUivan will be the only American players in the cast. Mayer will return about Aug. 20, after seeing 'Yank* off to a shooting start. WM. FOX'SALTED AWAY' $23,000,000 - TRUSTEE iladelphi iraih Steelman, trustee, in bank- ruptcy for Wiliiam Fox, asserted in federal court in Caindeh, Friday (2) that Fox 'salted away' more than $23,000,000 -in a 'family corporation/ headed by his ife and two daugh- ters. Then, Steelman sai , he went in bankruptcy in 1936, listing assets of $1,590,000 and debts of $9,500,000. Trustee asks that funds Of the 'family' firm, All-Continent Corp., be tied up by a federal injunction so they may be used to meet Fox's lia- iliti Crawford's Filiniisical Prods. Via GN or CoL Bobby Crawford is now in New xork negotiating for coin with which TO produce musicals.- Besides the aeal which has been pending with v^rahd National for several months, v-rawford also now has: ' in work With Columbia. Both deals are for releasing the v-i'awford musicals, if and When. Hollywood, July 6. Budgets^ 'forthcoming sea- son are getting the careful consider- ation of Bartiey Balaban, prez, and Stanton Griff is, board chairman at Paramount studio. Objective of the eastern execs, in conference with Adolph Zukor and William Le Barony is to make certain. that budgets once decided on shall not be hiked after production starts. Both Balaban and Gri is are said to feel strorigly that production over- head is too high and must be slashed. PAR'S BUDGET-STYMIED 'BARRIER'GETS GOING Hollywood, July 8. The Barrier/ Paramount produc- tion, finally pulls out for location shooting today (Tuesday) after being tied up by budget trouble. Company shaved off $87,000 on the budget which Harry Shermain was ori inally allotted for the filming, since 'Bar- ri ' was planned before the labor wage increase. Wheri Sherman requisitioned for additional money, he was nixed. Par telling him to either start shooting or suspend pro- duction. Sherman finally made the agree- ment to put up $15,000 out of his own-resources for the iricreased pro- duction, costs. 'Barrier' will be shot at Mt: Baker, Washington, with, the possibility that Edward Luby, director who has been on the payroll for 10 weeks at $1,500 per, will withdraw in favor of Les Selander. The cast, which will be on location for at least 20 days, is topped by Leo Carrillo, Otto Kruger, Jean Parker, Jimmy Ellison, Robert Barrat, Sarai Hayderi, J. M. Kerrigan and Andy Clyde. Sherman and his eastern rep- resentative,^ Jack Tropp, ill accom- pany the .troupe to Mt.. Rep's lone Ranger' Republic, which went to the air for 'Hit Parade,' picture of that name having just recently gone on relaase, has made another . radio aquisition Company has purchased the rights to the. 'Lone Ranger' serial program and will utilize material in making a 15-epIsode seri the 1937-38 season. Program, oh the air during the dayti , is 4% years old and has a large following,. according to Cross ley rati Hollywood, July 6. Grand National spotted Phyllis Barry in the femme lead of 'Ren- frew of the Mounted,' opposite Jimmy jjewell. Al Herman will pro- duce and direct the picture, first of four based on the adventures of the ether rhounti In 'an effort to protect themselves against increasing film rentals, now that all distributors ate planning to materially boost terms on the com- ing season's (1937-38) product, ex- hi itoirs and chain buyers will strive to make five-year deals this summer and fall whieh negotiating contracts. Because of the fact that there is a tendency to try to increase rentals every year, buyirs are willing to gamble blind on product of the com- panies they are dealing with as far ahead -as five seasons, biit, if unable to land five-year franchises, would sigh up for three as a compromise. In the buyer's • camp it is promised that strong resistance may be ex- piected to the rentals that will be demanded this season, highest in the history of the business and, under percentage dating, topping the brackets of 1929. It is declared that since most film deals 'are based on comproinises, it may be that if five- year; franchises cannot be obtained under suitable terms, the wrestle with the distributors might result in distributbi's yielding in other ways. For example, 'where a distributor is asking as high as 40% on top bracket pictures, the number could be re- duced at this stiff figure or a cut ob- tained on those which will call for fiat rentals. Will Settle for 3 Tears Buyers want-the .five-year agree- ments, and in isolated instances in the past have beein able to obtain them; but it is realized that if the distributors will not. tie themselves up on supply of product for this long, at terms to' be set now, the chances may be good that three-year deals can be obtairied. Situation is not unlike that of the tenant, in iapartment buildings or elsewhere. Who may be willing to gamble on conditions several years hence but has difficulties getting landlords to go for long-term leases because of the landlords' perennial hope that two and three years from now in: ci;eased rentals may be obtained^ With the distributors, rental terms are being scheduled to meet the in tense pressure on sales departments that is nOw coming from the studios, The producers, because: of increased film-making costs, are in no uncer- tain terms making demands for more rental from ef'veryohe. These de- mands featured alrnost all sales con- vention sessions the past two months. As result, distributors are setting up terms that will jump the higher- bracket percentage pictures to 40% in . jhost cases, ith sorn^ companieis thiat . are themselves highly en thusiastic about their product, pps sibly. trying to get 45% oh a few pictures. Still others, especially pictures which are first roadsho\yn, are iexpected to bring demands for 50%. What, distinguishes^ is season's demands, aside from an increase in the percentage brackets, is that for 1937-38 aill distributors are placing more pictures in. the higher 407o group, leaving fewer for the inter mediate and loWer brackets. It is also expected that along with the increase in the percentage brack ets, probably placing the lowest group at 25% of the gross, the dis tributors will try to get higher terms on the pictures sold on a flat basis Buyers' take the yiew even if they can't reduce the 40% torms on the top pictures, or cut the number of films placed i this No. 1 group, then there Will have to be a distinct compromise somewhere else along the line; even if disUibs are willing (Continued on page 27) Odluiii and Robt. Lehmaii to Coast as Co. Setto Emerge Fabrique Photogenique Hollywood, July 6; At the Pickford-Rogers . wed- ding scribes were handed out press releases with ITR' and 'W.D.' ('trousseau' and 'wed- ding-dress') written in pencil on; the margin. P. A. Mark Larki /explained, it was because there .had been a switch in cpstumeis, and dress, described as what Miss Pick- ford wore at wedding had been relegated, to her trousseau and a dress later described as part of . her trousseau had r^eally been her wedding dress. S|wltc.h' was occasioned in the trybuts Larkin said, 'because the other dress didn't photo- graph well.' 'S RADIO CITY If AGAIN liOndon, July 6; ,k promotion to build something akin to Radio City Music Hall in New York, which seats 6,000, is be- ing n>ade by Oscar Deutsch and 'City' fihahciers, including Philip Hill, head ot Beecham's Trust, and Joseph M. Schenck,. irman of the board of 20th-Fox. House will take in the. Lyceum theatre in the Strand, which is being purchased from Melville's, With sur- rounding property including Strand frontage, and will have a symphony orchestra and massive stage shows,: Understood that the promotion is the real reason for Charles Coch- iran's New York and Hollywood trip, and that he is now conferring with Schenck on the entire scheme. Coch- ran, it is reported, will Ise in charge of the stage shows. Scheme involves $10,000,000, with bulk of the money said to be. avail- able. Theatres Now Held Responsible in Xetty Lynton' Piagiarism all over are gravely concerned as result of the order handsd down Friday (2) by U. S. District Court Judge Robert P. Pat- terson in N. Y., who directed the appointment'of a referee to'deter- inines infringement damages/against the Moredall Realty (Torp., owners of the Capitpl theatre, N. Y. Jiidge Pattersph's order followed the de- cision of the Circuit Court of Ap- peals that/Metro's hit. picture, 'Le'tty Lynton,' was an infringement On the stage play, 'Dishonored Lady,' au- thored by Edward Sheldon and Mrs. Margeret Ayer Barnes. The origi action, Irected against Metro, was dismissed in the lower court. On appeal the Circuit Court reversed the decision and re- ferred it back to the district court for the appointment of a referee to make an accounting of profits and determine' damages, A referee Is engaged checking on this matter as regards Metro, Moredall, as owner of the exhibiting theatre, was brought in as defendant in a separate action. In view of the higher coiirl's ruling in the Metro, case, Judge Pat- terson oh Friday formally ordered $1 iiar. action to determine the anVounl due Sheldon and Mrs. Barnes. Hollywood, Topflight chieftai Corp. and the Lehman Corp., trolling Owners of RKO, are coming here , discussions with Leo Spitz, president of IIKO, SamBriski charge of production, grou is Understood to i Odium, presi Robert Lehman, man .Bros. ^firm. Their visiit at this time in inter- preted as being preparatoi'y to the company's: emergence from its 77b Situation. A Trade iriterest regarding RKO's pending reorganization plan^ centres on whether special master George W, Alger will make recommenda» tions to. alter the proposed settle- ment of the,. Rockefeller Center claim> as under the plan. Whether such an evehtuiBility retards the com- pany's chances of an early reorgan- ization depends ais much 6n the Rockefeller attitude as anything else. No conjecture regarding this pos- sibility is applicable at this time. . Were .no substantial alterations to be recommended and were Alger tio iriake his report shortly following the late August allowances, for fac- tions in the situation to submit biriefs, there is a chance that RKO's reorganization may be had by the first of the year. Formal hearings .before. Alger were concluded last week. Without reasisertinig the various and familiar angles of the RKO- Rockefeller Cienter isituation, there is logical business reasons for the trade's concern about what the spe- cial master may say in regard to the R.C. claim of $9,000,000 and it* proposed settlement basis. All classes of creditors iitand a (Continued on page 63) Treda Mark lieRl3tori>(t POUNIJED BV SUJB Kir.VKRMAN rubllvlteil Woekly by VAKIKTV: c Sid ailvermnn. .1,'reslrtent 154 Went 4r.th Str^eU New Yorh City INDEX Bills Chatler