Variety (Aug 1940)

Wednesday, August 7, 1940 Probe 1932 Acts of ^Continued fionv pape 23. heck -of Pii A:- PbWers, indepeh- missioner-designate dent sound; equipment maker, who once filed suit ajgainst RCA. Sar- hpft. said former Senator Moses was' asked to advise how to handle atiti- trust cases Ijecause he was an older statesman with: knpwlefdge of W^ish- ington. technique and that O'Callag- han and ^yhiteford negotiated with former Senator Hastings. Both ex-- iegisiators were paid surhs for which; they billed the: cbrti.Ranyi Sarrioiff de- clared denying unequivocally the story they received fat .campaign cqritributibns: Whiteford got $13,P00 for his part. Postponement of the court proceedings due to open iri October, 1932, was done With the ap- proval of the juijge, according to letter from H. ; C; Mahaffy, court T?terk> Who hkewise denied he ev^r was , in , RGA . office^ or.. received- remuneration for sending telegram delaying trial until cpniseiht . decree was fixed up. ' While Sarnpft at the outset said RCA never paid .any official of the Government for services connected with the trial, later he said he did not mean to give the impression; thiat the, Hastings law, Arm and M6ses were not compensated. Formier Ne\v Hamp$hire sblbri,. who was president pro tern of senate; fbr 'several, years, later was hired to survey European communicatipris problems, getting several thousand dlbllars in fees, RCA head testified. Neither of the; /ex-senatprs appeared;; in court, he acknowledged, nor did Whiteford, He thought Hastings firm got $7,500 for helping jprepare briefs. Dpubt. about innocence >■ of the;, transaction wis; reflected by varibus cbnimitteemen, While S e n a t o r Wheelei: , registereci strong;; ;;;disap- proyal of FCC for not making ^thbr- ough inquiry into various accusa- : tioris. ; The committee: hei?d; said "he felt / commissioners should; have cleared rhatter up for all time in ,con- jdiictihg chairi-hibnoipoly probe. Sen- ator, Shelrman Minton^ pf 1 Indiana commented sfceptically he wondered why RCA. bothered to get written . s/aternents a year ago from ail per^" sons involved il activities V/ere be- yond criticisrn.v The -keller story is 'fantastic ro- mance,', according, to Sarnoff, ;wlip said he nievei' talked over, the airiti- trust matter With Hoover, 'or arty other president' and laUghed. off the statement that he had: boasted of close friendship with President . R,bosevelt in allegedly predicting the suit would be settled.: Keller,; Who. has been consulting with Senatbr Tpbey's secretary fre quently during .previous .sessions, was; hot privy tp soms ; of the con- versaiions, he; miaintairied. Exper iences shouldconvince RCA that coinpanibs in trouble shiould not hire WashirigtOn lobbyists and jifessure .crewSf Senatpr Wheeler remarked, observing; that 'there are . inore. shake-dpwn artists in- 'Washihgtpn than any place I know of.' Sai*npff agreed, though maihtaihing t h a t when he sees. somebody who is ef- fectively iighting his company he: thinks it good administration tp hire them if possible; Belief that Seniate committee hearing on Thad BrPwh is being used by disgrimtled' RCA minbrity stockholders was voiced:: by /'Savlsi at one point. He feared sudclen twist'inquiry has taken, might malje committee a gpringboard while corn bribing Somebody to maintain « monopblyy it. will look ihtc- if. It's a pretty poor excuse. You bught tb ance in the witness chair. He per- sisted, in his explanatipn that the FFC . prbbers confused the lacts^ Icnow it. These commissions ought maintaining that Paley and his assa background without being quies;- tibned or even noticed ^ Summons Voted Thursday S'or Vacatiqniii^ Sarnpff Summbrts for Sarnoff was voted, Thursday (1) after the RCA head declined to return from his vacation and sent word he dpubted he could be ef use or help to the solons. The preyibUs day the, cpmnriitteie rhade numerous additional rings around, the Columbia-Paramount mulberry bush and heard Tobey go after Thad; Brown again in regard tb. numerous statements contained in thie chain- monopoly committee's report. Strong denunciation of the FCC for failure tp. .pay more attention to what's sa id on tlie floor of Congress: preceded Tcbey's motion to insist on attendance of the R€A prez. Both the New Hampshire Refpublican and Chairman Burton K. Wlieeler . of: Montana lashed Brown, insisting it. was inexcusable fbr the regulators to disregard charges that one of the Government's' licensees tried to 'bribe' miembers of the Senate br interfere with the administration of. justice.. ■■■ ;;.. - "■. '■ ;■' .. ••'. ; Registering : surprise, iat - Brbwn's nbnrappearanee at the Thursiday (1 > morning session,. Tobey . announced. that ai'representative of RCA (prcr sumably ;former Assistant Secre;tary of Labor Edward .F. McGrady) Had ;offered to be pf service after explainV iiag the company chief was relaxing frbni his iatKjrs.,;: "Tobey squawked that he, would; not be satisfied with any; pinch-hitters, tliat he desirt^d to quiz the individual whp could give first-hand testimony, about the/Wil- mington case. ;;. To pave the way for hls niptipn to summon Sarnoff,; Tbbey commented on the 'cpnspiCupus absence' from ;he chairi-monbpbiy report of refer- ences; to :*another big brbadca^ing^ company,*, .particulat'ly when sucn criticar.cpmment was made concernT. ing CBS. ile also observed that six weeks ago he dte w attention to . as- sertions, by former Rep. William D, MacFafclan* regarding RCA-lTBC; eventST-^he spoice ■. of .'very seribus', aCcusatipnii that stbckholders had been 'defrauded' of millions-^and added he had . expected Brown to offer some testimbny about this mat- ter. The Granite Stater paraphrased tlxe one-time Texas Hous*; membeir as haying presented liroof that RlCA hired twoy.itormer Senatprs. 'tp per- form an operation-^to interfere with; the course of justice' . in the 1932 anti-trust proceeding: ■ ^ *Gharge9 by Gipngte^^^ Deserving of Respect ■ The Tobey .summary agitated Sen- ator Wheeler, who turned fui-iously on the FCC member-^addressing him ;irequently,. in belligerent fash- ioni as 'your^Brown!—With declara- tion that- the Commission cannot justify overlooking the MacFarlane complaints, carried in 1938; Con- gressibnal Records^ . When ' Broy/n demurred; that 'y/idespread notices' of the chain-monopoly hearing; had been issued, the Mpntana Democrat isnarled 'you can't hide behind that..'. if this CommisSipn has any brains, ;when a man makes a statement on the flobi- of Congress- that a man is ciales prpflted because they bought CBS stock low and sold it high,, not because they; manipulated company funds imprpperly; Throughout his argument,, Tobey appeared skeptical -—pbserviiig repeatedly he thought the repurchase by Columbia^ was de- signed to .establish a,. price- so Paley and the other • inaiders could unload jiart of their holdings to Efrown Btbs., Harriman at a handsbme figure.: He liioked up iiicohsistehcies in Cplin's prior discussion, particularly a . re- mark that the;:CBS oWhers paid cash .for; the Paramount paper. Senator Wheeler likewise: cbntinued suspi'^ cipus, pbser.ying that cPiripany money was usbd; to ;:'enhahce' the stock Pf. A- few direcibrs^which Cplin'vigorous- ly .denied, v" ■'. ■Brown was put under the; spotlight again at the, cpnclusion of Cplin's. testimbny and treated, roughly , by Tobey \yhen. he proved unablW.'to elaibbrate on - miscellaheous stater ments in the- chairt^mpnppoly report. At one pbiiit, the harrassed Commis- sioner was forced to call oh Wiliiam; J. Norfleet;; chief :accpunta'nt p£; the FCC, to help untangle the statement that CBS Used Icapital' funds to buy iiack the stock held by , Paramoiiht.; (Colin . and ; John j.: Burns, ispecial Columbia counjel, argued Vehement- ly that :the jpurchases were financed out of ■ 'surpius'.); For a while,' the heariiig ; :Was V / free-for-all with Biu'ivs and Colin sharply cross-exam- ining Brown and;NOrfleet. . When Brown tried to reiad from va letter which ;Fly sent the cominiftee ^the , Communication never was made public—aboilt the (CBS mattei:, Tobey snarled,-.'Is Fly goipg to be a: ;wet-nurse to you, a; crutch fbr you?* .Norfleet's : remai-lc . that; CBS books were Confused ihfuiriated Colin,, who. yelped that the; FCC accbUnit^^ alibi. Was 'ridiculbus /on ; its face,' while Tobey angrily announced. he considers it 'a damned; outrage' if the chairi-rnonopply ; proteins submitted an incorirect repoi-t, \ ' Oh some: points,; Brown back- traclced noticeably. He ;said - that the complaint in the::;repprt that CBS di- rectors Ibbked after their own inter- e:}ts. sacrificing , those of other iri- vestbrs, was' an 'errpr^ arid cbhceded that at one pbirtt; in analyzing CBS pperatibhs the document : included , 'several: names thai shotildn't have Recrimiriatibris. about inability, tb i been there,' He maintained that the bring a Congressiprial probe pf ;mo- ] QBS repurchase 'had the appearance nORoly came from Wheeler and Tp- | of. stbck-riggirig operation, but bey. Both remarked that the Ad- I commented when all the facta are ministration killbd the old Gonnery j available such ah indictment ;'ma/" resolutiori by assuring Congress; the | have, been too strong.' FCC would do all the investigating ' ; Relationship between Brown and necessary. .Wheeler observed, 'the • former Governor James Cox of Ohio, same excuse was-given us, when Sen-1 as well as the commissioner's friehd- ator White sought to bring about a ! ship with other FCC lidensees. was Senate inquiry. White remarked that J brought into the discussiPn. When to investigate these thing • Contrast betwe^i the Col-Par mat-, ter and the IVIacFarlane charges, Tobey said, makes it doubly difficult to understand why the Commish jiever v/eht ; into- the Wilmlngtbn matter. He said the 'sin' alleged to have been committed by RCA; outweighs 10 to 1: the conduct of CBS V which the - Chain-mbnopply probers criticized severely, adding 'you close your: eyes; you never batted an eyelash,. .this mattpr has dropped into oblivion.' ; If true, the accusations against RCA. more ' ' ' than the offense with which the probers charged Paley, et al.i he cpmmented. ; Question whether the Justice De- partinent ■ should not be. held , V, sponsible, for looking into the MaC- Farlane assertions:Was raised by Sen- ator Homer T. Bbne, while Senator Wallace H. White sought, to excuse both Brown and the two former senr ators reputedly hired to bring about postponement of the anti-trust case. But these - observations did not si-^ lence Wheeler or Tbbey, although both agreed the Attbrney General's office, should .have paid attention. These, statements about RCA are 'the strongest kind of evidence, if true, that a monopoly existed'. Wheeler yowled, saying he cannot understand the feeling' this Situatipn was not Worthy of inquiry by the regulators. 'The Senate^ committee ■ chairman- burned Brown with com- ment that 'either you're dtimb or yOu: didn't want; to go into this'. In his own defense. Brown quoted Chairman James L. Fly—who was employed, in the Justice Department anti-trust division at the time the alleged.'fixing'- tpbk place—as saying it is not the FCC's prbyince to com- ment on ■ conduct pf: anti-trust casies and that the Commission's limited powers : would not Warrant any in- yestigation.. This', statement by Fly,, in a letter sent Wheeler, June 17, is. no excuse at all. Wheeler declared, inquiring^ 'what in the name of God did ypu hold an investigation for :if you're not going into monopolies? Radio Investigation Sidetracked by Promise 'somebody in a high place' feared an outside body, and Tobey sourly Tbbey remarked : on the surprising speed with which the Commish rati- cracked, 'somebody heard his mas-j fied sale pf ; WSB, Atlanta, to Cox, ter's voice'. . | Brown; said . he did hot believe any The wisdom of checking on news . nolitical : influence was exercised. commentators and, Coinmish restric tiohs, against, forrner amployces en- gaging in radio practice also-: were brought intb the hearing Thursday (1), :^heeler showed alarnrii , at ; re- ports. WL'W, Cincinnati, may try to j mission member to accept favors and get its 5b0 kw license renewed un- i hospitality from individuals ertfiaffed Tobey sourly noted that Cox 'urged your appointment ; at the White House and has been urging your conflrmation', and then inqiiired if Brown feels it is 'proper* for a Com IMPORtlllT FACTORS l| |H^^^^^ " ' Baltimore has all 101 get de^ the guise of national defense, while Tobey^ backed up by Senators Clyde Reed of Kansas and Vic Dona- hey of Ohio, Was critical of spielers who might take a one-sided view of the war situation, In the latter re- gard, nasty . remarks ; were made about H. V. Kaltenborn,^ and Edwin C, Hill. Brpwn-'s only comments on this subject were that FCC rules re- quire definite announcements wlieh- ever any programs are sponsored. Good adveriisiitg coverage; at reasonable rales." 10. An:ayieriEige income^ (as detemiihed by Saleg Management''a Siiiryey o£ Buyjng Power) vWhich correlates closely with Uie section, or its'pbpulatibh group A ppjpiidatiPn Which is divirirsified^ representalivei well- .Imlanced, of. average cultural level. An average level of business activity; Suitable and sufficient distributive outlets. Well-diversified industries. S 7. ;A self-contained economy;' be well-isolated in relation lo Other larger markets. Close to average retail s^les per family. Compact boundaries, for tiiales eflicicncy and frequent checks. [':','':.■' Advertising media which will cooperate in making a test.* 3. 4. 5. 6; 8; 9. EDWARD PETRY & GO. National Representativcla ON THE NBC RED NETWORK engaged in the broadcasting business. Brown justified hiis conduct by pointing out he knew Cox 29 years, prompting a cryptic, remark by Tobey that he would not go into Brown's visit to Agua, Caliente while op official busi- ness in Los Angeles,. WBNY Stays Individualistic Buffalo, Aug. 6. : New slogan is 'Buffalo,.city of good neighbors,' and most sta- Much repetitious testimony ; ;was ; tions are: so .calling it in their staind- elicited from ' Ralph Colin, counsel ^^"^^ for William S. Paley and CBS, con cerning the Columbia - Paramount stock swap during the day-long ses- sion Wednesday (31). In the end, Tobey dropped his suspicious man- ner and indicated he was convinced there Was' nothing wrong and the, FCC probers had done an injustice in assailing CBS in their report, : After Colin had been quizzed for two more hours and offered further explanations of CBS' 1929 agreement bo sell to and the 1932 agreement tp buy back frbm Paramount, Tobey complimented him on being a forth- right witness and supplying valuable information. 'Then he pounced on Brown once nioire, demanding justifi-^ cation for Various statement?" in the report critical of Coluiiibia.:: :Bpred colleagues displayed almost. nb in- -terest-ih-the-rehashT-though^enator- Matthew M. Neely of West Virginia Wailed- few times that Tbbey was going'far afield, especially:ln inquir- ing whether the necessity of buying back its stock was not one of the primary reasons.why Patamount was forced to reorganize under 77B. Little new information was sup-' pliedby Colin in his final appear- bys, But WBNY has cooked tip phrase of its own, 'the city that has everything.*' road . Washington, Aug. 6, . ; Bill imposing stiff - punishment on anybody ; transmitting 'subversive matter;' as laid before Congress, In- cludes radio, raising the spectre of coded messages or foteign-lahguaga propaganda. Legislation - offered by Sen- ator Robert R. Reynolds, North Car- ''. olina Democrat, who is one of the , most vociferous denouncers of fifth columns. His proposal is to jail for two years or fine Up to. $5,000 any ? individual who helps spread un- American ideas or treasonable sug- gestions. Under the terminology, station operators might be subject to these penalties, matter what safeguards they take. . Egyptian Prince In Monti, to Shortwave Pleas to North Africa :•■.■• Montreal,. Aug. 6. ■;'.^ Prince Abdullah : ■ Ben , Ayad of Tunis, uncle of the King of. Egypt, who arrived here last week to take up temporary residence in Montreal, is planning a series [. of radio broad- casts to French North Africa. The Prince will endeavor to swing Tunisia, a J'renCh protectorate, to support Of Gen. Charles de Gaulle, and, all thpse of French descent Who are fighting for. dembcracyi .; In a statenrient to the press on . arrival; Prince «AbdulIal\ said that.; Tunisia would resist any attempted Italian inyasipn bf^the: country. The! Prince, who lost a leg during the last war in the Dardanelles campaign, is reported to have received a request from : Admiral Musllier,. fighting chieftain of the French marines now with the . British forces, that. he launch radio ; ajjpeals to the- citizens of French North- Africa to support the French men who are fiee to fight; against their common enemy. Honor Sullivan, Louisville, Aug. 8. WHAS newscasters Paul Sullivan and Dick Fischer were given honor- ary memberships iii the Regular Vet- erans Ass'n Wednesday (24). Tha group is an organization of veterans who have voluntarily, served with the Army, Navy, or Marine Corps, and were the 34th and 33d, respectively, conferred by the organization in its 10 years' existence; Presentation ceremony took plac* in the WHAS studios, and George L. Griswold, national deputy chief of staff, who is finance 'officer at Fort Kiiox ,teld new enrollees their merri- berships were recommended becaus* of recipients' 'unselfish, and uncea.s- ing services' and because their 'pa- triotism and loyalty are unques- tioned.' Caps and insignia were pre- sented along with the memberships. WBAL THE O'NEILLS' By JANE WEST NOW RADIO'S MOST POPULAR FAMILY BRINGS YOU MORE [aUGHTER JeARS and [-|eART-THR03S Presented by Ivory Soap ■99" i: ' ■ pjre LISTEN DAILY NBC Red Network, 1Z:19 to 12:30 P.M. ED! |M 6:45-6 P.M., EDST * • '^COAST TO COAST Dir. CO.MPtON ADVSSITISING AOBNCX MGT. ED WOLF—RkO BLOC. NEW YORK CITY