Variety (Aug 1946)

Wednesday, Anguat 7, 1946 PICTIJRBiS FlLMy SUREF IRE $130,000,000 All lop UWP Execs Will Be Absorbed by Parent U Co. Says Prexy Boxscore on the Decree As tilings now stand, the boxscore is as follows: 1. The Big Five attprneys will huddle among themselves next Tuesday (13) to determine whether further negotiations with the D of J are feas- ible. General pessimistic belief is that dickerings will be fruitless and that the five companies should prepare their own decree. Company attorneys are holding out for wide flexibility in the decree which would permit the distribs to consider such factors as playing-time, theatre policy, character of the exhib, his flnan.cial responsibility and char- acter of theatre in awarding a fllm to a bidder. Government proposal entails no conditions excepf term^ of bid in choosing between "compara- tive" houses. ,D of J is also holding out firmly for open, public bidding. 2. Little Three will hold no more confabs with the D of J.. Attorneys for these companies will prepare their own deci-ee and then fight it out in court. Any exhib-distrlb differences on selling will ha,ve to be settled by court and not by arbitration, regardless of the terms of the decree. '3: Exhib organizations, hopped up against bidding for pix, will press for divorcement as the only, remedy which they believe will hold down film rentals. Stand against„auction selling has been taken by every major theartre group and these units will seek the right to appear .in court as amicus curiae to file briefs against it. 4. Government has committed itself definitely to an appeal from the denial of theatre divestiture. It hopes to have the appeal before the Supreme Court by the first of next year. No definite stand has been taken by any of the majors but cross-appeals are considered likely. Big Five will certainly test partial divorcement order of the statutory court and Colombia will probably challenge the ban on block booking. 5. All majors but Universal are already selling-pix single under agree- ment with the Government for a gradual adaptation to the terms of the decision. U following its merger with Enterprise Pictures and its dropping of all B pix is expected to swing into single selling in the fall. Columbia ha.<; a policy of one-or-all fllm sales which permits an exhib to buy single D C. and Majors Far Apart on D^ree; Little 3 Rules Out Arbitration Protracted negotiations, now int their second month, have pushed the. Government and the eight major defendants in the anti-trust suit further apart on decree terms than ever before' and it's odds-on betting that no agreement will be reached by the court-Axed Sept. IS dead- line. 'Actual breakdown in negotia- tions has occurred between the Little Three and the Dept. of Justice and the attorneys for the former will present their own proposed decree to the court. Meanwhile, a meeting last week between D of J reps and attorneys for the Big Five broke up on the auction-selling question in an absolute stalemate after both sides refused to give an inch on their views. In further developments which highlighted the uncompromising po- sition taken by both sides, the Little Three advised the Government that it would not enter any arbitratioir system set up by the court. Little Three rejection of arbitration is final since the court, on its own say- so, has no power to compel the de" fendants to accept that mode of ironing out exhib-distrib disputes. Attorneys for Columbia, Universal and United Artists maintain that these companies will live up to any decree signed by the court and that there will be no necessity for an elaborate arbitration system. Ex- pansion of arbitration, they say, would be costly with one lawyer estimating the nut for his company at $500,000 annually. With no thear tres of their own to help pay the way for pix. the Little Three must obtain the highest rentals possible for ^hei'r fllms and are, therefore, onjf interested in selling films to the highest bidder, it was said. 28 OF 56 UPCOMING TO CHI NABES ARE REISSUES Chicago, Aug. 6. Underscoring the dearth of new product available ti> nabc houses, there's a new high of 28 reissues in- cluded in the feature release list for the subsequent-runs for Septem- ber, put together last week by Jack Kirsch, Illinois Allied prez. That'.s exactly half of the entire field of 56. Metro is represented by only one new pic, and that an import, "Por- trait of Maria." Warners and Co- lumbia have two apiece and Par, 20th and Universal have four apiece, with two of the 28 reissues under the U banner and one under Par. RKd has five newies, Leader in the reissue race is Variety Pic- tures, with nine on tap. Not Without Reason Living quarters and motor cars are more important than salaries to top British stars and directors who have been tempted by Hollywood contracts. Recently three male toppers and one director refused to sign unless the American^tudios guar- anteed comfortable lodging and automobile transportation. They had read in the London news- papers about the shortage of housing and the high price of cars in Hollywood. U Shifts to Solo Sdling Pronto Universal will sell its new sea- son's product singly at auction in accordance with the federal court decision in the anti-trust suit, Charles . D. Prutzman, yeepee and general counsel for the company, said this week. Prutzman, just re- turned from merger huddles In Lon- don in which the anti-trust de- cision played a major role, stated that there could be no question of the court's intent and that U would embark on the new - sales policy without awaiting the formality of a decree. Actual details of the mechanics of auction sales would be up to dis- tribution chief William A. Scully, according to Prutzman, with U's legal staff standing by for any ques- tions of interpreting the court's inr tent. No switch in policy on '45-46 product sales is contemplated, U's chief counsel said, because a change- over on it would cause too much confusion. U's revamping of policy brings all eight majors in line with the court stricture against multiple-pix sales. The Big Five agreed to the change in a court and counsel huddle in June while Columbia announced its intention of selling on . a one-or-all basis in July. United Artists cus- tomarily sells its pix singly. Johnston's Tour Due Washington, Aug. 6. Eric Johnston, Motion Picture Assn. pre.\y, may include Germany and the occupied countries in his European tour, • slated to start around Sept. 20. Ken Clark. MPA pressman, said he believed Johnston would visit Italy and the Balkans as well as Engl.'ind and France. Johnston's aide. Joyce. O'Hara, may go alon^, Clark said. PROFITS TO DIITE Predictions that the net profit, of the film industry for the flscal year of 1946 may reach the staggering flgure of $130,000,000 received an added piish over the past week when both Warner Bros, and RKO reported advances more than double that of 1945. WB's skyhigh net of $14,749,000 for the nine months ending June 1 was more- than a 100% tilt over the $6,364,000 profit which the company garnered in the comparative period of '45. • Close on the heels of the WB re- port, RKO announced this week a take of $3,205,398 after taxes and all charges for.the second quarter of '46, bordering on triple the $1,280,- 734 figure that the company chalked up in the .'45 second quarter. RKO's total for the first halt of the year is $6,881,352 as against $2,421,778 last year. WB and RKO reporU are in line with both the forecast of the June 12 issue of 'Variety that this year's flgure would be in ex- cess of $100,000,000 and a recent Standard (i Poor analysis predicting more thsin double last year's profits for the majors. Tendency now is to revamp con- servative estimates of total net profit which held the estimated fig- ure to $100,000,000. Upping of esti- mates stem not 6nly from the latest WB and RKO reports and a recent one of Loew's which showed a 40- week profit of $12,5'if9,245 but also from field surveys which' indicate that hot weather grosses have ral- lied substantially. An early dip in b.o. which had been sharper than that caused by heat and humid- ity alone has now leveled off into (Continued on page 31) Krim, New Eagle-Lion Prez, Hnddling Foy, Then Sales Org Setups Arthur B. Krim, tagged for the post of prexy of Eagle-Lion Films last week, planed for the Coast over the \yeekend for production and sales huddles with Bryan Foy, E-L studio chief. New E-L prez will turn to setting up a sales organiza- tion following his New York return within the next week or so. Selection of Krim tightens ties be- tween E-L and British interests of J. Arthur Rank some of whose films are to be distributed in the U. S. by the company which Krim now heads. The new prexy Is a member of the law Arm of Phillips, Nizer, Benjamin It Krim. Robert S. Ben- jamin, also a member of the flrm, is prexy of the Rank organization in the U. S. as well as general counsel to E-L and Pathe Industries, parent company of E-L. E-L's Bromfleld Buy Hollywood, Aug. 6. Screen rights to Louis Bromfield's latest novel, "Kenny," were bought by Eagle-Lion for $50,000 plus a share of the profits. Aubrey Schenck will produce the story, which will run as a serial in Cos- mopolitan mag. 'Audience Penetration' Kids Add a Coast Y.P. Hollywood, Aug. 6. Prior to leaving for New 'Vork headquarters, Albert E. Sindlinger, prexy of Audience Research, Inc., announced that Jack C. Sayers had been upped to vice proxy in charge of the Hollywood office. Increased scope of activities has Sayers aided by Beverly Jones, former associate producer of "March of Time," and Robert Forbes, presently with Princeton office but moving out to head research development program. Sindlinger has been here the past three weeks conferring with Sayers and studio clienls, of whom the com- pany now has 12 producers, on the subject of research on the new "auc- tion" selling and distribution format. British Payroll Tilt London, Au^. 6. Following the pattern set by Hollywood labor unions, the Na- tional .\ssn. of Theatrical & Kine Employees have won a raise in wages from the Cinematograph Exhibitors Assn. in an agreement closed by Tom O'Brien, general seoy. for the union. Pact grants a salary boost for 130,000 employees, with an an- nual payroll hike of over $6,000,- 000. BigUPowwowOn Coast Next Week Nate Blumberg, Universal prexy, left New York for the Coast last night .(Tuesday) for huddles on changes resulting from the decision of last week to merge U's production interests with those of International into a new producing company. Uni- versal International. U topper ar- rived from England over the week- end with Joe Seidelman, U's foreign topper, and had intended to remain in New York for a few weeks belore heading Coastward, but found press- ing problems out there making ad- visable his immediate departure. . General huddle of all U, Interna- tional and United World Pictures ex- ecs concerned with the changes made will be held on the Coast late next week, Blumberg stated Monday (5). Whether he will wait out there for the others or come back' to New York in the interim will be'defer- niincd by circumstances, he said. Most of the officials who attended the meetings with J. Arthur Rank in. London during the past month at which the reorganized setup was de- cided on are back in the United States. Leo Spitz and Bob Goldstein, of Ir.ternational,. are scheduled to leave England today (Wednesday) on the Queen Mary and arrive in New York next week. They'll clear up some details in the east before going on to the Coast. J, Cheever Cowdin, chairman of the board of U, has gone to Stock- holm from London and will return shortly. GROSS TALKS EASTERN FILM PROD. WITH COL. Ed Gross, legit pi'oducer, is talk- ing a two-picture deal for eastern production with Columbia.. One of the films, reportedly, would be an adaptation of "Pick Up Girl," play by Elsa Shelley which ran on Broad- way in '44 and is current in London. Idea behind eastern lensing is to staff both pix with all-legit casts drawn from main stem shows. PA Building 3 Stages On Lot, Skedding Six Hollywood, Aug. 6. Three sound stages, currently un- der construction at the new Pro- ducing Artists studio here, will be ready for use in three weeks and six more will be completed in No- vember, according to the owners, Joseph Justman and Jack Schwarz. Nine-stage rental lot, costing ap- proximately $3,000,000, will be augmented by a 40-acre ranch in San Fernando Valley, to be used for exteriors. First to use the studio will be Producing Artists Corp., headed by Justman and Arthur S. Lyon.s, with "Imperial 'Venus" and "Prelude to Night" slated for fall production. Schwarz will rnove in' late in August to produce independently for Screen Guild release. Stages not used by these companies will be rented to indie producers. Certainty that all present execu- tives of Universal and .of United World Pictures would remain. with U When UWP Is dissolved ■ and, U's production activities are merged with International was expressed, by Nate Blumberg, U prexy, Monday (5). "Manpower Is the industry's greatest need and there's never , too much of it," Blumberg declared. Among those affected by the U- UWP-International, changes last v/eeW are William. Heineman, UWP salesmanager; Monroei Greenthal, UWP publicity-advertising:, chief; Cliff Work, U production head; AN fri^d Schwalberg, International's sale.smanager; Bernie Kranze, UWP's eastern division manager; and. other lesser employees. Mere problem of finding a spot'^in the new U setup/for all the execs" isn't so great as placing them in posts where sensitivities won't be hurt by reason of rank. Blumberg said he was certain that in each case an acceptable formula could be worked ottt to insure that the men will agree to remain. Most of the mien involved, however, were ex- pressing ho certainty about the fu- ture. Heineman has a five-year contract, starting last F ibruary. It provides speciflcally that he Is to be employed as salesmanager of UWP. Greenthal has ho contract, although he is a very close personal friend of Matty Fox, who jumps from UWP prexy to exec v.p. of U under the reor- ganization. Greenthal was'the first UWP employee. U .is planning to set up a separate sales administrative and promotional organization for the J. Arthur Rank British pix it will distribute and 'there is a slight possitiility that Heineman and Greenthal will be segued into those spots. However, both of them are understood to feel that the jobs aren't in keeping with the ^ importance of their original posts. ' Heineman and Greenthal As for the two UWP execs going right into U, there are other difficul- ties. Heineman, who was formerly as!>istaht general sales manager ot the company, doesn't want to go back in any spot that would put hint beneath top rank, it is understood. (Continued on page 26) Cagneys' Gen'I Service Buy-In May End Their Sales Tie With Goldwyn Peal through which Cagney pror ductions bought Into General Serv- ice Studios last week is expected to mean the end ot the distribution representation pact William and James Cagney have with Samuel Goldvtivn. Latter's sales organiza- tion supervised release by United Artists and approved all exhibition contracts for Cagney' product, start- ing when the Cagneys set up pro- duction on the Goldwyn lot. Gold- wyn got 3% of the gross for the service. Inasmuch as the chore has been considered more or less a courtesy by the Qoldwyn staff, it is antici- pated that it may be turned over to Carl Lesermah, since Cagney is leaving the Goldwyn lot. Lcserman is a partner with and sales rep for Benedict Bogeaus; owner of the studios ,in which the Cagneys bought a substantial interest. Cagney's next flfm, "The Stray Lamb," will be made at the Gold- wyn studios, but subsequent picr tures, starting with "Lion in the Streets," will be filmed at GS. Wil- liam Cagney was elected a v.p. and director of GS. S Pix In Work Hollywood, Aug. 6. For the first time in five years, General Service has. five pictures shooting simultaneously oh the lot, the fifth being "Dangerous Venture," recently ' returned from location at Lone Pine. Others are Bogeaus' "A Miracle Can Happen," Columbia's "Mr. District Attorney," Hunt Stromberg's "Dishonored Lady" and Charles R. Rogers' "The Fabulous Dorseys."