Variety (Feb 1949)

irwfawJffy* Fcbrnary 2, 1949 nCTITRES SIMPP MULLS DEC REE PROTEST I I M l ^ i j iii -y ■ ii > i. 'V i ' I , 11 '« i ; ,ii r . p .-ii.i . i.i I , 1. 1 . III yi ii i i !. ii r -l I ni •j . n- . yn i m ihi. n w im ■ iiiMiii. i mm .^i m„ m w i n .,. i, ' ■ j , , ■ TOA Directorate Asks 20% Tax Repeal Points Up Exhib Fear of Video Par Eyes Theatre Auction Sales Paramount may dispose of a number of Us theatres, ordered sold under either ft consent decree or court directive, by public auction rather than private negotiations with prospective purchasers. At least one inquiry of Leonard Goldenson, Par's theatre head, by a party interested In buying a group of theatres has elicited the * response from the company veepee that Par intends to liquidate via the auction method. ■ If this system is employed, it would mean that the company Would advise the trade that specified theatres are available for bids. By stacking "one prospective purchaser against the other, manage- ment probably feels it: can obtain the best price without any sub-- sequent dissident stockholder charges against private deals. On other theatres; being privately dickered, company has hit on another formula, it has been learned. It is asking for eight times the net earnings or five times the gross take. Either net or gross is figured on an average of the past five years. Stickler of What Constitutes a Closed Situation Stalls Par Consent Decree One of the disputes which must* be ironed out between Paramount and the Government before a settlement can be finally Inked in the anti-trust action is whether a drive-in constitutes competition, in a given town or city. Continuing negotiations have set up the prin- ciple that Par will sell at least one theatre in every closed situation: But the sparring around has failed to clear up the question of what makes a situation closed. : The difficulty over drive-ins illustrates, the' reason why negotia- tions have now stretched out to a five-week serial. Both parties are in agreement on the fundamental that closed spots must be opened, /However, the chores of applying the principle in detail to specific situations is proving the stumbling block. ■ The negotiations, it was learned, have caused a sharp split of opinion among the board of directors. One group is opposed to accepting the ■ harsh terms- laid out by the Dept. of Justice. Majority faction, how- ever, is backing a compromise with the contention that it would serve the best interests of stockholders. Board has its regular monthly meeting tomorrow (Thurs.) when ' (Continued on page 2Q) New Par Decree SetforWrap-Up Washington, Feb. 1. Attorney General Tom C. Clark indicated over the weekend that the new Paramount antitrust con- sent decree is ready for the final •wrap-up. At the same time, he hinted that these decrees with the majors may be amended reason- ably early. ' • Clark, who had declared a day or two earlier that the Par item would be history within a couple of weeks, came into a session of Theatre Owners of America board of directors to state: "We have have had a consent decree with one producer, and another is about _ to be wprked_Ottt, .1 hope whatever Is worked out benefits the exhibi- tors." In response to questions from the theatremen, Clark said the door would be open on the com- <Co]titinued on page 12) linfeld Stresses He'll Make No Staff Changes .,?^harles Einfeld, new publiclty- f2y*^"*'"g veepee of 20th-Fox, emphasized this week that he con- ■^""Pjates no changes in the staff ?f department. Einfeld ar- tZ New York Friday <28) trom the Coast. He'll headquarter in_^the east but said that he would » 1 the studio in about a month. «n?i**^i^! Schlaifer, whom Einfeld succeeded, wound up at 20th last Ucl * month's vaca- Vn^u y'"^" h« returns to New ''^^'^^ to set up the Us^^i^' Schlaifer company, adver- wni l?"^ P"''''*^ relations, which Ott Jm,e^S^*' moth's ad,agency "«junei5, t, ■ The Society of Independent Mp- tibri Picture jPrpducers Is muliing plaiis for protest; (igainst the Gov- emmeiit's apparjbnt wiUinghess to settle the industry . khtl-triist, Siiit via a ; serlev 6f ;^cWnsent i dec^^ which wilt- keep intact large p6rr tibnsi of the theatre circuits pres- ently affiliated with the major compdiiy ■defendantsi. RKO has. already come td terms with the Dept. of Justice' pfn such avdecree, paramount, is neai" one, and: 20th- Fox and -Warrier Bros, have been consulting with D. 'ojE: Ji 'officials with that fiossibility in mind, SIMPP mcmbcis. execs and legallte.s have not fully determified whether they want to ehter a pro- test and; if they do, exactly what form it should take. Uncertainty is based partially on the fact that the legal grounds are not quite clear and that SIMPP. merhbei'S Hollywood; Feb. 1. are more or less sure that their Editing, dubbing and scoring of squawk would have no effect be- first pic completely made under I yond the moral one in publicizing Howard Hughes' regime at RKO lltheir objection. Are Pix That Bad? IjOS Angeles, Feb. 1. •Popcorn and candy, old r,esi- dents of film house lobbies, have a new neighbor—i-per« turnery. Six downtown thea- tres here have installed slot machines to dispense vials of sweet odors. By dropping two bits in the slot the film fan can carry home a tiny bottle of Joan Bennett Perfume. Hughes' 1st for RKO was completed ovef the weekend "It's Only Moneyj" Frank .Sinatra- Jane Russell starrer, came in on nose of $850,000 budget. Two other pix .wound up. re- i cenlly, "Clay Pigeon" and "Set- | up," were started when Dore Schary headed the studio. Kickback Verdict On C. P. Skouras Due In Few Wks. Word is expected from Referee Jacob S. Demov witliin the next few weeks on whether an okay will be forthcoming on the offer of Charles P: . Skouras, National The- atres head, to kick back to 20th- Fox some $1,300,000 under a pro- posed N Y, supreme court stock- holder settlement. Action charged exorbitant salaries and bonuses to NT officials. Hearings before the referee, which started Oct. Ij; have now been completed. Testimony on the proposed compromise .filled 819 pages in addition to a large number of exhibits. Demov was named by Protest might be made directly to Attorney General Tom "Clark or to the court when the decrees are presented, for approval. At the time of the 1940 consent decree, the Federal court allowed a full day for interested parties to sound off their . objections. The . judge then went ahead and: signed the decree as written, which is one reason why SIMPP execs are not too optimistic about getting re- sults. Decrees are technically a deal between the Government, which brought the action, ; and the defendants, and so the right of the indies^or any other outslder-*-to protest is hazy. .■ I Difficulty with a howl to the At- I torney General is that, aside from I the case of RKO, where a settle- I ment; was announced, SIMPP has I (Continued on page, 48) EL s300G Rental For Week Points Up Profits Rise Disney's Blitz ^ Preem for 'Heart' Walt Disney's "So Dear to My Heart," currently at the Palace, N. Y., will be exhibited on a unique; policy- in: the .metropolitan. N, area. It wilt preem in 113 bfher houses on Washington's birthday. N.Y. I Feb. 22, and then in'two waves of Washington, Feb. 1. The directors of the . Theatre Owners of America called on. Con' , gress over the wcsekend to TFjepeal,. the 20% admissions tax, .arid' pointed up the shatp- awareness that exhibitors^Jiave of the poten- tial competition of video. The tvvo-day board session here (28-29) urged exhibitors to look oyer their local situations with a view toward: getting into teleyision; if feasible; even if onli^ a small in- terest in a station. Meeting; also warned the stu<lios that' "a 'grave• danger iarid injustice" would exist if the films inade for theatres we also sold to video. The. theatre- men heard Wayne Coy. chairnlan of the FCC admit that their indus- try Will face a tpugher job getting tele licenses than most other: liiies ;bf business because ^ pictures already are "a mediuin Of com- munication." Other highlights of the conven- tion: Los Angeles was selected as the I 1949 convention city. There was For the first time since it started ! talk of a four-day affair, probably releasing pix two years ago. Eagle ; early in October. Lion last week went solidly ahead j ih a resolution calling upon Con- of operating costs in film rentals, i gress to repeal the admissions bite. Company took in over $300,000 for the TOA board claimed this would the seven days, scoring a substan- | stimulate attendance that the tial net oyer its break-even point i Government would receive enough of $250,000 for current weekly ex- j revenue from increased corporate ponses. High point was reached income taxes to make up for the after EL had upped its take for jogs of the 20% excise, the week before to $270,000 in xed Gamble offered a resolution rentals. ] calling upon Eric Johnston to re-. Rally of EL in the past 121 schedule the cancelled all-indusr months has showed up in. the fact i try meeting in Hollywood, so that that the outfit for the past half-1 tlie matter of the bad press caused year has been garnering renlals i by some few: Stars could be con- sufficient to get It past its oper-1 sidered, , ating nut. Profit margin, how-1 A resolution calling upon MPAA I ever, had heretofore been com-' 1 paratively thin, bettering the I overhead figure by $5,000-$ 10,000 1 weekly, :•,.■,.■ ■■ ■: - ■, Pacing the climb to a solid mar- gin of profit were J. Arthur: Rank's "The Red Shoes," handled here by EL. and its own Hollywood-made "He Walked by Night." Showing f of "Shoes," currently distributed I on a roadshow basis at a $2.40 top, I is particularly strong, with the pic displaying potent staying power. Film, which has opened in some 110" spots in the past few months, I has yet to close in any of the slt- I nations. , Increased bulk of shipping and playdate availabilities on other and the producers "to cease sup- plying service camp theatres with commercial motion picture films prior to their showings in the competitive theatres of the United (Continued on page 13) Pic Dividends Oif $9,500,000 supreme court Justice Ferdinand Pecora after a splinter group protested the settlement arranged by minority stockholder plaintiffs. Besides repayment by Skouras, deal called for rebates of $198,000 apiece by his aides Frank (Rick) Ricketson and Elmer: Bhoden plus a smaller sum -by Harold Fitz* I gerald. I ceiling of $300,000 yearly was I placed on percentage bonuses which could be paid to Skouras additional houses with seven days clearance in between. Scheme, worked out by William B. Levy, Disney distribution exec, with: RKO, the distribj is a modi- fication of the plan used by David O; Selzniek for his "Duel in the Sun." In that case "Duel" preemed in .54 metropolitan houses day-and-date with the opening at the Capitol on Broadway. Disney had hoped for a nabe day-and-date preem with the Washington, Feb. 1, / Film industry dividends for 1948 ran over $9,500,000 behind the pro^uct'heiped'push 'the 'tolal last I 1947 stockholders' melon, U. S. week. At the same time, while | Department of Commerce figures current releases are now turning 1 disclosed past week. Dive was due up with a sizeable profit, writeoff I principally to, the fact that four of weak product released during I companies—-RKO, 20th, Universal its first year still presents a prob-1 and Warners — aggregated divi-. 1cm. Part of the thin take of that i dcnds of about 30% less than dur- semester must still be absorbed by ling the preceding year, the net now being consistently I Total pix dividends-reported to turned in by the newer films. under his contract. Milton Pollack I Palace, but it couldn't be worked is fronting for minority stock-1 out. Same purpose will In part be holders seeking an okay _pn the , served, however, since advertising compromise. Sria'^prpmotiDti "f or the ^Palace run is being held to a minimum. Con- centration of the campaign will be on the nabe openings. This -is in line with a grow.' Ihg opinion, shared with Disney, bjf Selznick and other indie ; ;piro- ducers, that';,;|or some types- ■ of . product there is a great waste of Metro's Silver Anniversary Fes- [ coin on a big pre-Broadway cam- tival. marking 1949 as the com-| pajgn so much is spent on ad- pany's 25th year of operations, will j vertising that It cannot be hoped MAJORS SOCKED WITH NEW $1,317,000 SUIT!aSl^,„ffi^^^^ the Government amounted to I $44,905,000, compared with the I sock, record-breaking $54,641,000 ! of 1947. Decline was about 18% but still it was one of the most record for the METRO COAST CONFAB TO TEE OFF 25TH ANN!. Los AngeleSy Feb. 1; In December, the pix -companies disbursed $7,593,000 to stockhold- ■ ers, not far behind the $7,959,000 I for December, 1947. I Commerce Department estimates that these publicly reported divi- 1 dends are about 60% to 65% Of all dividends issued. get its sendoff during the series of confabs slated to start here Sunday (6). With top execs of the three branches of the company converged for the huddles, plans will be that the engagement will turn out financially profitable. All the pro- ducer can get is prestige^if his picture is well received. ; New thinking Is: "Why spend all Hollywood, Feb. 1. Major distributors, affiliated the- atres and one Independent circuit ! were hit Monday (31) with an anti^ I trust suit seeking a total of $1,- '317,000 in damages. Complainant its Griffith-Coleman, Inc., on behalf \ !of its new La Tijera theatre. Suit l is the second to be filed -by a new j exhibitor in recent months on the: irun product. because: of alleged 7tli Stockholder Suit ; '"La'Tijera suit charges that the' Qll WB"USP Sctlltt new de luxe showcase IS being I »*~»-|» I jeopardized in Its efforts to con-j Seventh minority stockholder ac- tinue as a firstrun because of the ] tion attacking a 1946 production drafted for s p e c i a 1 promotion i that money in the newspapers and through Metro's regular ad-pub on the radio when, at best, you unit and its musie^ record and i:adio can expect to till nothing more subsids; ■ than a 1,500-seat house? For the Scheduled to arrive here from same expenditure, or a little more, N Y today (Tues.) and tomorrow you can make the advertising wo^k "are Arthur M Loew, Howard Dietz, toward filling thousands and thou- John Murphy Eugene Picker, Wil- sands Of seats in scores of houses. Ham F. Rodgers, Edward M. Saun- ders, Ted Gould, Silas F. Seadler, William R. Ferguson, Herbert Crooker, Ernest Emerling, H. M. Disney spent $68,000 on pre- opening and first-week advertising of his last pic in New York, "Melody Time," at the Astor. Ritchey,'Mike Simons and William : Total expended for a" ^«af :, Ornsteiu. i'-.^ i (CoHtmu»(l an "page'ja*- ' ■ ' maiors refusal to supply product, i William J. Kupper, Jr., general ! manager for Griffith - Coleman, declares that; although the theatre [was built and advertised as a first- ! run house, it is in danger of closing (down because of the lack of prod- iuct. Theatre opened with "My ■Dear Secretary" from United ;.Artists-. : Defendants in the action are 20th-FOx, National Theatres; Fox- West Coast theatres, Warnens, Co- lumbia, Loew's, Universal, Para* mount, RKO and Prin-Cor United Co., operator of the four music halls from which UA sold away on "Secretary" boolcing for the La Tijfel'i.' ■'' i f 6 , i {>' f »»,H *t'ti I deal between Warner Bros, and ■United States Pictures has been filed in N, Y. Federal district court. Named as defendants besides the two companies are Harry M., Jack L. and Major. Albert Warner, Sam- uel Carlisle, Samuel Schneider, John E- Bierworthi Joseph Bern- hardt and Milton Sperling. Ac- counting of all profits from the production unit is demanded,: sim- iterly .to the other pending suits. Action was filed by Abraham Fistel, Who claims a production pact whereby the unit would' make six pix on the Burbank lot with Warners paying 50% of the nut was illegal and improper. '