Variety (May 1938)

VARIETY PICTURES Wednesday, May 4, 1938 Teleidione Co. Pool Wins Again Vs. GTP and Transformer Co. inglon, May 3. Grip of tlie telephone trust on the sound picture equipment field was strengthened Monday (2) by a 5-1 U. S. Supreme Court- split which upheld infringeitient proceedings against General Talking Pictures Corp. and American Transformer Co. Despite vigorous representations about monopoly, majority of- the tribunal' concurred in opinion by Justice Pierce Butler holding there is no doubt that owner of a patent can stipulate the conditions, under which products made by a licensee are used. Ruling' puts a crimp in efTorts of Independents to dislodge the Western Electric Electrical Re- search Products and Radio Corp. of America combine' which now domi- rates the spund equipment business aiid may fender ■ exhibitors liable it they use W. E.' or RCA parts in systems of other manufacturers. ' Highest tribunal—with Justices Owen Roberts, Benjamin Cardozo and Stanley Reed, not taking part— held in favor of the telephone inter- ests and. the patent pool in the prin- cipal controversy whether patent owner can restrict the use of prod- ucts after they:haive passed into the hands of purchasers in the normal channels of trade, and whether mere notice attached to the article is en- forceable restriction against .unau- thorized use. In this instance, General Talking Pictures Corp. purchased-tubes from American Transformer Co., which is one of several manufac rers hold- ing non-exclusive licenses from the A. T. Se T. through which they can make and sell amplifiers for 'private use,' but. not for any commercial purpose.. Permit expressly confined American Transformer to production of parts for amateur,-home, and ex- perimental radio sets. Despite these conditions, the Arm sold, tu s to G. T. P. knowing they were to be installed in theatre systems in dis- regard of the license notice. 'The patent owner did. not sell to petitioner the amplifiers in question or au'hori the transformer com- pany to sell them or any anipliflers for use in theatres or any other com- mercial use,' Justice Butler declared. The sales mads by the transformer company to petitioner were outside the scope of its license and not un-: der the patent. Both parties knew that fact ajt the time of the transac- tions. 'There is no ground fOr the as- sumption that petitioner was 'a pur- chaser in the ordinary channels of trade.' Justice Black's issent An attack on the electrical indus- try patent pool featuired Black's dis- sent. The New Dealer warned that the majority view of the law will result in sweeping expansion of boundaries fixed by Congress and bring about a monopoly not con templated under the Constitution. 'The mere fact that the purchaser of a .standard and uniform piece of electrical equipment has knowledge that his vendor has contracted with an owner of a patent on the equip- ment not to sell the equipment for certain agreed purposes does not en- large the scope or effect of the patent monopoly,' the dissenter said. 'The patsnt statute only gives the patentee the exclusive right to make, use and vend his patented article.' Regarding license to makeand sell a patented gadget as. a transfer of the patentee's right to control its use, Black said the telephone com- pany lacks power to fix resale or stipulate cohditior; of use.. Exclu- sive right to vend does hot empower the patentee to extend his mpnopply all down the line beyond actual sale, he said,. nor docs, the law en- able the holder of the patent to re- strict what is done with an article bought in the open market if it is produced by a person with a license. 'Those who acquire control of nu- merous patents can—by virtue of thc'r patents^wield tremendous in- fluence on the commercial lite of the nation,' the New Dealer said in blast- ing the cross-licensing arrangement in the electrical equipment indOslry. *If the exclusive patent privilege to 'make, use .aind vend' includes the further privilege after sale 16 con- tioi—apart from contract—tlie use ct all patented merchantable, coin MAUDE ADAMS' PACT Selznick pic Offer With Vhusual Tro- vUIons—M»y Go With 'Wind' Hollywood, May 3.. David O. Selzriick today was await- ing Maude Adani ' ^signature on, a contract that will mark her screen debut ^before .defihileiy casting, her in an important role in 'The, Yoijng In Heart,' which went before the cameras ■ yesterday (Monday). iss Adams has been studying the pact since last Friday; when-it was typed after several days of conferences be- tween herself arid the producer. Former stage actress has been in Hollywood for a \veek, coming at Selznick's request after being given, camiera and voice tests in Nev/ York:' iSihce her arrival on- the Coast, she has undergorie. makeup! and hair-- dfess tests! under the guidance of Richard Wallace, who , will direct 'The :Young in Heart.' Selznick has informed Miss Adams that she may take her time in affixing.her liame in view - of the fact that she would not have to go into the part for from two to three weeks. Pact is an unusual one in that iss Adams is given the right to cancel after completing her first chore, should she decide that she does not care for screen- work. Deail was worked out on a ilve-year basis with options. - Should she- decide to cast her lot with the talkers, she would likely be assigned the mother part in' 'Gone With the Wind.' Laurel Drops Sidelines,- Will Stick to Acting Hollywood, May 3, Stan Laurel, lately a producer arid talent manager as well as an actor, will devote his futuire professional efforts exclusively to acting. Screen cohiic dismissed the staffs of Stan Laurel Productions, Inc., and San Laurel Pictures;. Inc., after a- checkup disclosed that both ventures were losirig money. ■ Laurel Pictures made one western, Krilght of the Plains,' which has not yet been- released. Jascha Heif etz O.K.V Swingin' Classics, If- Flynn, Bishop Head Metro's New IVlidwest Setup Out of Chicago Chicago, May 3! Ne-w setup in the local Metro offlce, with. Jack Flyrin c'oriiing in from De- troit to take oyer as district manager, replacing Sam' Shirley, who is re- tiring after more than 25 years with the Arm. A]so has.Bill. Bishop com ing in as midwest press head. He replaces Fred BartoW, resigned after more than 10 years 'with the com- pany. Latter quit rather than take ah assignriierit which- would shunt him to Indianapolis,' which he con; siders a setback not' commensurate with his decade of-continuous serv ice for.MG. ■W. £. Banford is in as branch nian- tiger, brought oh from St. Louis to fil the vacancy caused' by the de parture of Felix Mendelsohn. Understood that Metro is giving Shirley an annual pension of $3^000. New Malcolm Browne Indie Settmg Prods Ad Agencies' Strategy to Pireserve Public Goodwill with Comml Films OH FUDGE Candy Bar idlculed?—$SOt,OOA Spit vs. Temple Pic With production budget set, al colm. Browne Pictures Corp.. execu- tives will go to the Coias't in about two weeks to align production plans for initial features in the 20-picture group to be turned out the first year of the company's existence. First production will be available- for re- lease early in July. Studio and player deals will be signatured in the next three weeks. Malcolm Browne company ha."; scheduled eight westerns, eight melodiramas and four more cOstly features, for 1938-39: Distribution through state righters; Jascha Heifetz, recently snared by Sam Goldwyn for a-picture, has an interesting slisint on the swing-'the- classics battle. Diverslfled tastes make' plenty of room for music of aU, description, but the famous violi ist believes each should stay in, Its own backyard. He -amplified his stand in his Hotel Madison (New York) suite, between answering tele- phones and' supervising packing. 'In America,' he said, 'sportsman- ship is applied to everylhlri^g,. It is the American credo. 'Very •well, then, apply it also to music. A dance band nriay swing Beethoven and Bach. It is a trick-^ven an ingenious musical trick, although it adds nothing to the lustre of these great composers. My point ..is that-it can be done.' But can any serious musician or organ- ization, of riiusicians u-se anything that Tin Pan Alley has to offer"' The an.wer is decidedly 'No! 'That is where the* sportsmanship comes in. Is it fair for light musicians to invade the seirious field when they have nothing to offer thie serious" mu- sician in return? I say it is not; Let thehi borrow from the classics when they- have something to offer the con- cert musician in. fair exchan .' Wh'cri time, in Mr. Heifetz's opin- ion, will be—never. Has no-idea what-the story \viU be for his picture. Sportsmanship again He will have complete charge of the music,- therefore the studio can .. be dictotor about, the picture. He is quite certain that he is only going to'play, himself,' but he shouldn't be surprised if he winds up doing a part. He doesn't know—yet—that anything can happen in Hollywood Says it's thrilling to think of the vast audience to be reached through this mediurii. but is regretful about being torri from his Connecticut farm just as he is. well started-on his garden. , Gardening conies second to the fiddle in Mr, Heifetz's affections. Believes there's no such animal as a person who, can't carry a tune- 'even if it is only 'Yankee Doodle"— and -(quite- naturally) one who doesn't like any kirid of music is in conceivable. Aiid a great many more people would like serious music if they would trouble to make its ac- quaintance. People who hear one or two ponderous compositions and de- cide they 'just don't like classical music' are gypping no one but'them selves. Planned picture is a one-shot; Mr. Heilet-i says cinema- invasion is. an 'interesting experiment' for him, not a. career. Claiming damages of upwards of $500,000, through an alleged libel committed in a sequence of the pic- ture 'Rebecca Of Sunnybrook Farm,' starring'^ iShirley Temple, the National Conf tioners Association filed suit yestcr y (Tues.) in New York su-. preme court against 2dth Century- Fox Film Corp. Besides .dariiages the plaintilT also wants, to'stop further showing- of the picture, xinless the averred libelous part is deleted. The complaint, filed through the candy makers' attorney, William E. King, charges the sequence not only reflects oh the trade, but viciously attacks the purity and wholesorrie- ness of a-candy bar. It is claimed the bar is 'held up to shame and, ridicule n the eyes of millions of children who yiew'Shfrley Temple as a model and ieschews everything not con- sidered good by her.' The association has 325 members and employs over 60,000 in theUnitied States alone. Each member is en- titled to bring a separate action, the complaint poirits out, but to avoid du'pUcating and waste of ti , the association brings a general suit The seqitence objected to, .according to the complaint, is carried on-be- tween Rebecca's (Shirley Temjple) horiiecbming when , she- meets her Aunt'Miranda: .'Have, you had any- thing to eat?' asks the aiint. 'Oh, yes,' l-eplies Rebecca, 'a candy bar.' Turn- ing to Gwen the servant, Aurit Miranda orders, "Take the- child to the kitchen and get her something decent to eat.' WB's Songphigger Fihn ollywood, M.iy 3. Song pluggcrs will be glorified in Warners' production of Harry Sau- ber's 'Making a Hit.' Dick Powell draws the role of the No. 1 play-niy- songer. Harry-Warren and Johnny Mercer will tunc the piece, which Sam BischotT produces. ' Hollywood, May 3 . Tbscha Seidel, violinist, checked in at the Metro studio to record for 'The Great Waltz.' Accompanying- orchestra of 78 pieces will be directed by Arthur Guitman, sw.i irig a baton for M-G for the first ti Rockefellers Grant StiO Another $69,000 For Classroom Fibiis An additional $69,000 has been given by the General Education l>oard of the Rockefeller' Foundation for classroom films, with Alice V; Keliher rerriairiing as administra- tor and actively in charge, of the fund and activity made possible by it. Original two-year grant of $75;0p0 ran out this month, uf soirie 36 short instructional subjects' have been culled from feature pictures.. New series will be called ' liman Relations' pictures. They will he si ilar to the 'Secrets of Success' Alms, fostered by the Hays office but, since taken over b/ the Rocke- feller Foundation, orily thing is that the^ title is changed. Organization picks feature productions made by major cbriipanies a year after re- lease date and editing best scenes cut for shorts when adjudged of in- structional value. Dr. Keliher also is chairman of the Commission of Human Relations, anothier Rockeleller-flnanced pro- ject. Hart Loses Again In His Suit Against UA bined and'iri many respects riiade to function as one . . . The exclusive privilege to exercise the unrestrained power to determine the ultimate uses ot 'all these important merchantable modities can be exercised by-, patent | articles sold in the open market is ewners; Declaring the pool .seek.s to curb competition arid parcels out certain fields to each member, . Black said 'separate patent monopolies are com- a power I do not believC: Congress has conferred. A power so far- I'caching ... . has not been expressly graiited in uny statute-and should not be read into the law by Irhplicatioii,'- Oh, Just a Small Set Hollywood,- May 3. Seventy acres ot sets for Metro's 'Too Hot to Handle' are under con- struction at the Culver City studios under the supbrvision of art director Cedric Gibbons. Backgrounds include hotels in Shanghai and-New-York, ,n Pc.nn.'jyl- vahia airport and a farm. Clark Gable and Myrna Loy w^ll star, with Jack Coriw.iy directing. Ed Lome's Personals Edmund Lowe is being offered for eastern -vaude by Curtis &, .Allen; agency. -No salary being-quoted. Film ac tor is currently on Coast and won't cornc eiist until a date is set. illiam S. Hart, former -cowboy screen star, who has been legally battlin ited Artists for the past two years in New York courts over the income on one of two talkers he A .new approach to the sponsored picture now is being mulled by ad- vertising agencies planning on han- dling commercial films for clients on a long-rarige point-of-vlew.. They >yould set up ah association, not un- like the Outdoor. Bureau, which has eliminated or curbed unethical prac* tices.in the outdoor advertising busi- ness in the U. S. While such organi- zation of sponsored film producers probably would be slow in getting into operation, it-is the intention -of agencies who contemplate continu- ing in the screen bally field .to pro- ceed-with the setup in order ta mi i- mize complaints received froin any faction in the business world. The sponsored Aim bureau or as- sociation -would strive' to be repre- sentative of the entire Tield. 11 would, be controlled by a committee or board composed of a representative from independent exhibitors organi- zation, either the MPT<DA or Allied, or both; -representatives from out- standing ad agenci:; , from the Na- tional Boaird of Education, Cai-negi or Rockefeller cbmmitl on educa- tional research; one or more .spokes- men from industrial firms, and one outstanding consumer rep. to s for the public'on;tbe board.. Association, -through this govern- ing body,-would pass on every spon- sored film submitted-to it, with.ap- proved pictures "receiving a certifi- cate-or seal Of okay, in this man- rier, distributors who might desire to handle a sponsored subject could tell whether or not the organization had deemed' it suited for theatre arid public consumption. "a -few",of the things tentatively suggested for this organization's taboo would be no price mentions, no contests or premiums, and only an iridirect advertising approachi it any semblance of ad matter is incoi-po- rated into the Aim. Only sponsored pictures, \yith some scientific, educa- tional or artistic merit would be con- sidered. Subtle AdTcrtislnr Pluf , In discussions thi|s far; it has been pointed out that this would elimi- nate screen productions plugging for one product.' It would be okay to dispense ideas on the product of the sponsor in. general .terms or, by in-' ference, such as was c" ne on U,. S. St I's one-reel Aim and 'The River.' Latter was viewed as propaganda ot a sort for the TYA. Another exam- ple cited was 'Yes, Uananas,' United Fruit one-reeler in which there it no mention of the company since united Fruit'holds almost exclusive distribution of this fruit.- This reel already has been bOoked into rnore than. 42 theatres -in and about Bos- tori, including, the RKO Boston. Slant o^ these advertising ex in formulating ;,uch an associati for .sponsored Alnis is that such type of picture must be handled entirely differently from radio ad mailer. They.admit thr.t it will be impcssible to come at the audience from the screen with items or anything that will tend to rub 'em the wrorig way. Further claimed by. them that if .<iponsOred subjects do not possess something honestly educational, sci- entific or in the realm of phantasy, the advertiser might we|l stay out of theatres altogether. Most mazing is their attitude that they fail to see where reduction ot obnoxious or blatant advertising, even down to 6():feet, helps matters.- They charge that an fludience can insulted as quickly and badly in a minute or two, as in a longer, pic- ture, in which a s cific product is heavily plugged. In the meantirrie the Associ ion of National Advertisers meets' tod.ny . , . , and tomorrow (4-5) in-New York made under UA. auspices, yesterday with tentative plans calling-loi-a full (Tuesday) lost his appeal to the U. S. circuit court for reversal ot a lower court's di.<imissnl of his ac-. lion. Hart and his sister, Mary S. Hart, sued the picture producing corporation, for $185,000. or the total take on his picture Tumblewecds,' He contended he in vested, over $300,- 000 in making, the picture and that UA had breached an a.yrecment to share in. the costs and that it h.nd flopped on proper exploitation for the picture, resullirig in poor box- office returns. H.irt won a ver ict of $75.()00 in N. Y. .supi-eme coiirt in the same case, but the Appellate Divisioiv re- versed the verdict <ind ordered a new trial which is .kIIII pending. Hart then filed the suit in the fed- eral court. session to be of sponsored cli devoted to discu.ssion films for ad agency Doug» Jr/s, Tax Bite Washington, M:i.v . Jaws of U.-:S. Board of T.nx Ap- peals clamped on Douglas Fiiirb»nks, Jr., for a 1933 income lax deficiency of $5,263. , Would .have been a $9,926 bile, ex- cept that a squabble occuried over the amount of the income of Kiiir- bariks' former wife, Joan Crawford, which Uncle Sam formerly claimed should have been reported on Fair- banks' return for th^ part of the? year prior to their separation.