Variety (Aug 1939)

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Wednesday,. August 30, 1939 PICTURES VARIETY 1939-40 SELLING UP A BfT BERMAN'S DEAL WITH REPUBLIC FOR UNIT Hollywood, Aug. 29. Pandro Berman, retiring execu- tive producer at RKO, awaits the ar- rival-of Herbert Yates, Sept 15,—to close a deal as head of his own pro- duction unit at Republic. Understood Yates' proposition to Berman pro- vides for salary, percentage of profits and an opportunity to buy in on Republic stock. Beritian checks r-ul of RKO Nov. 1 after which he plans a three-month vacation. Hearings on Atlas' $4 Per RKO Share Offer Comes Up After SepL 4 First hearings on the fairness of the offer of the Atlas Corp. of $4 a share for the balance of the 375,- 000 shares of the new. RKO com- mon stock not taken by Rockefeller Center, or the unsecured creditors, will be begun almost immediately after Labor Day (Sept. 4). George Vf, Alger, special master, who is to hear argument pro and con, so stated Monday (28). Reports that Atlas planned to withdraw the un- derwriting agreement because of the possibility of a European war could not be checked as attorneys for the company were continuously 'not in.' Alger, however, declared that the only reason for the delays was the Inability of the SEC to appear be- fore Labor Day. The RKO hearing scheduled for . Monday (28) was postponed to Sept. 20, due to Judge William Bondy being on vacation. Alger's Fee Federal Judge Samuel Mandel- baum in N.Y. Saturday (26), on peti- tion of Irving Trust, RKO's trustee, authorized the Chemical Bank St Trust Co. to pay to Irving Trust $7,000 out of funds on hand as a fee for George W. Alger, special master, who was recently allowed that amount for his services connected with the reorganization. Under an agreement dated May 4, 1938, RKO gives $15,000 monthly to the Chemical Bank to hold, for administration expenses and allow- ances. Alperson's Particulars In $135,644 Suit vs. GN Federal Judge Samuel Mandel- baum in N. Y. Thursday (23) grant- ed the application of Edward L. Al- persoh for a bill of particulars against Grand National Pictures, Inc., Educational Pictures, Inc., and Earl W. Hammons, who he is suing for $135,644 for alleged breach of contract. Alperson claims to have been employed Oct. 1, 1938 on a five- year contract by GN at $1,000 week- ly, plus 14,000 shares of common stock of GN payable at a rate of 3,500 shares each quarter. The con- tract could be terminated on six months' notice. Alperson asserts he was discharged as head of sales of GN on Jan. 21 last. Besides the $135,644 he seeks 10,500 shares of stock. D.C'S FILM AMBUSH Aftermath of the death sentence of the Trade Practice Code passed out by Thurman Arnold, assistant U. S. attorney in charge of anti-trust Htigation, is the feeliiig expressed in top executive circles of film company home of- fices that the industry, during the past year, lias been led into a legal ambush from which there is no escape, except through a trial of the issues in the Federal courts. mittcd, and an opinion of the department re- quested, the reply was a blistering condemna- tion of the Code and a threat of prosecution if its provisions were put into operation. Pascal to Produce Play Adapted by How'd Dietz Gabriel Pascal will finance produc- tion of 'The Captain's Uniform' on the London legit stage ' this fall, if conditions permit. Play has been adapted by Howard Dietz from the German by Karl Zuckmayer. Pas- cal produced a film based on the original play, 'Hauptman von Ko- penlck,' in 1030, and is reported con- trolling all film' rights. Mrs. Howard Dietz arrived in New York Monday (28) after con- ferring with Pascal in London on plans for the production. Opinion prevailed for hi6nths~that, with the voluntary adoption of the Code, the Depart- ment of Justice would modify its bill of com- plaint in the civil action now pending in the Southern District of New York. It was be- lieved generally, on what was taken to be au- thentic soiirces, that the Government W9in3~ cooperate with the industry's attempt at vol- untary self-regulation of such matters as were incorporated in the proposed Code covering concessions on block-booking, clearances, forced selling of shorts and other practices that were to Be adjusted through arbitration. Of the main count—theatre divorcement from producer-distributor ownership — the Code made no attempt to handle. This issue was conceded from the first to be handled exclu- sively in the courts. First reaction/was an exchange among in- dustry attorneys and executives of bitter com- ment on the Arnold letter. In some places the opinion was expressed that the Government's trust-buster had not acted in entire good faith in his dealings with the-fihii companies. It was pointed out that the Code made no pretense to handle the issue of theatre divorcement, yet the Department's reply made very clear that any trade practice code, which was not predi- cated on divorcement, but was based on the ■prevailing status quo, was not acceptable. Official of one of the major companies de- clared the Arnold letter to industry attorneys came as a bombshell surprise and was a blow to industry prestige, unwarranted by the pre- vious exchanges of correspondence and conver- sations in Washington. He stated that a year ago, in July, 1938, heads of the larger com- panies had conferred with President Roosevelt and liad pledged at that'meeting their deter- mination to work out a satisfactory routine of trade practices which would remove from the Government the press of widespread exhibitor complaints. Within two weeks after that meet- ing, the Department of Justice smacked down with its civil suit. There is good authority for the report that the original complaint of the. Department was drawn as a prosecution, un- der anti-trust laws, and later changed to a civil suit. Individual action by Grad Sears, distribu- tion head of Warner Bros., in announcing soon after publication of the Arnold letter that War- ners would incorporate immediately, in its new season conffacts, the important concessions won by exhibitors, during the months of ne- gotiations, was a move which caught the other majors unprepared to follow the same course. The Sears announcement is regarded generally as a. smart move for Warners, wherein the company has taken advantage of an impasse of concerted action and has stepped out on its own to encourage exhibitor good will. There is anticipated a lively legal battle when, as and if the New York suit, repeatedly postponed and delayed, comes to trial. Three companies named in the complaint—Columbia, Universal and United Artists—deny complete- ly the right of the Government to include them with other majors that have theatre affiliations. Since the Department of Justice is making its fight for theatre divorcement, attorneys for these three are laying their defense to insist upon dismissal of the complaint against them, as they claim no theatre affiliations. Opinion is now expressed that the film com- panies leaned too heavily on early assurances that if they cleaned their own house the Gov- ernment would give self-regulation a chance to perform. From time, to time, during the course of 14 months' negotiations between dis- tributors and exhibitors, copies of drafts of the proposed Code were sent to the Department of Justice. Ill the light of subsequent happen- ings that procedure is now regarded as some- what naive. When the. final draft was sub- Involvement of the anti-trust issues with the Trade Practice Code debacle is reported to have prompted some of the attorneys, inter ested only in the defense of the lawsuit, to de- mand a hands-oflf policy from any industry volunteers who would attempt from this point on to interfere with the orderly procedure of getting the issues to trial. Counsel contend that the multiplicity of the complaints de- mands earnest and painstaking investigation in order to cope with Government witnesses. N.Y. HE DEALS STILL ALMOST NIL' Big Circuits Generally Perk Up in Closing Deals—Two Notable Ones Are Metro- Warners and WB-National Theatres—But It's Still Very Laggy SHIFT SEASONS? On that account alone, they declare, post- ponement of trial is justified until all defend- ants have full and complete opportunity to prepare their defense. JAS. ROOSEVttT WILL PROBE FIX PROBLEMS Hollywood, Aug. 29. James Roosevelt was appointed a one-man committee to study prob- lems confronting the Motion Picture Producers Association, including in- ter-studio relationships. Joseph M. Schenck, prez of MPPA, declared the survey is concerned solely with local conditions and has no bearing on any dispute between certain producers and the Federal government With an Eye to the Cost Hollywood, Aug. 29. Economy deferred the start of 'Re- becca' at the Selznick-International studio .to Sept. 5. Delay was ordered to evade the cost of - carrying contractecs over Labor Day. Martin's Col. Musical Hollywood, Aug. 29. Tony Martin's first musical starrer under his Columbia contract is 'Pass- port to Happiness,' due to start Sept. 7, with Joseph Santley directing un- der production reins of Irving Starr, Yarn is by James Edward Grant. Dr. A. H. Giannini Returns to Films As Lubitsch Aide Hollywood, Aug. 29. Dr. A. H. Giannini returns to pic- tures as a member of the board of directors of the new Ernst Lubitsch Productions, Inc. Other board mem- bers are Sol Lesser, prez; Ernst Lu- bitsch, v.p. and secretary, and Louis Lurie, treasurer. Under the new set- up. Lesser turns over control of Prin- cipal Productions to Barney Briskin. Lubitsch company has a deal to deliver three features to United Ar- tists during 1930-40. Al Lewis Yens Tuners Hollywood, Aug. 29. Al Lewis is dickering a major re- lease for several fllmusicals he would produce independently. Understood he has ample financing. Mccormick soloing Hollywood, Aug. 29. John McCormick, associated with Leland HaywarS for two years, launches his own agency Sept. 4. George Landy is slated to join the new setup. FREEMAN SAYS PAR'S '39-40 FIX WELL SET Film selling to big circuits throughout the country generally has accelerated in the past week or so, although activity in the New York territory is still almost nil. In the last-named area, independent thea- tre owners are still holding back on their buying. None of the larger, independent local N. Y. circuits, neighborhood or subse>-ent runs has been sold by major distributors. Exhibitors in N. Y. territory are usually late in their buying every season, practice being to wait until both Loew's and RKO have conv- pleted deals. Reason for this is that indies and subsequents want to know what pictures have been bought and how the first-run situation is going to shape up. Based on this informa- tion, they can then form a good idea of what product they themselves will need and how much the film is worth. In the metropolitan area the new season.^ film lineup for Loew's will be. Metro, Paramount, United Artists and Republic. For RKO theatres, Warners, RKO, Universal and 20th-Fox. * Generally speaking, with efforts of major distributors concentrated on the large circuits around the coun> try, selling has been late as well as slow. As one sales head described it, 'exhibitors think there Is going to be a Utopia and feel they can afford to sit back and wait.' Some theatre owners feel their present require- ments are being taken care of by de- livery of two or three pictures stiU due them from the various distrib- utors on the '38-39 schedules, and that this will carry them along until well after Labor Day. Metro has closed up Important cir- cuit deals, without worrying too (Continued on page 23) Paramount studio is nine months ahead of schedule on its '39-40 pic- tures and will complete nearly the entire program by December, ac- cording to Y. Frank Freeman, in charge of studio operations. Free- man arlved in New York from the Coast Monday (28) for a week ot conferences with Barney Balaban and home office production execs on pic- tures to be made for the season of '40-41. Only two '39-40 productions, one a De Mille picture and the other a Claudette Colbert Aim, will still have to go before the cameras early in January. Freeman returns to the Coast next week. Stanton Griffis, chairman of the executive committee, is not due back from Europe for another six weeks, unless hostilities hasten 'his return. Trop's Par Dicker Jack Trop, former v.p. of Harry Sherman productions, left for the Coast Sat. (26) after >everal months in New York studying, possibilities of Indie production in the east. Producer expects to continue nego- tiations west for financing and pro- duction of a series for Paramount re- lease. Trads Mark RcKlntered FOlINnBD BY SIMB SILVERMAN I'ubllMlied Wvchljr lij' VAKIKTY, Inc. KM .sllvermRTi, -prcvtldcnt 154 Weat iOt\i Street. New York City INDEX Bills 40 Chatter 48 Dance Bands. .34-35 15 Years Ago. 38 Film Reviews -14 Film Showmanship 8 House Reviews 16 Inside—Music • 34 Inside—Pictures 21 International News........ 12 Legitimate 41-44 Literati 45 Music 34-35 New Acts . 39 Night Clubs.. ......36-38 Obituary 47 Outdoors 47 Pictures 2-23 Radio 24-33 Radio Reviews ........ 28 Radio—International ..... 33 Summer Tryouts 44 Vaudeville 36-38