Variety (November 1921)

Friday. Wovember 25, 1981 MOTION PICTURE DEPARTMENT—Pages 41 to 47 PICTURES 47 ' " — ~ FIRST NATIONAL SUB-FRANCHISE CONTRACT • .. WEAPON OF OPPRESSION, SAYS SEN. WALKER t; ^ Before Theatre Owners Chamber of Commerce Slate Senator Attacks Whole System of Valuing Productions Practiced by J. D. Williams and Organi- zation—Cites Specific Instances—Feist's Objections—First National Exec- utives Fail to Attend, Though Invited—Company's Statement Mr. Fiest took exception to several \ entered on those bearing on the position was as follows: figure quotations made by the Sen ator. Clause 3 Senator Walker stated that, in his opinion, "the subfranchise contract is not v.orth, ♦.he'jjaper it is written on. It is inequitable and lacks lisved by many the meeting Tues day would likewise result in a set- tlement of the questions in difference between the exhibitors' organisa- tion and the First National. This did not prove to be the case, as none of the executives of the First National was present. Prior to the meeting a letter was deliv- ered to Brandt, signed by J. D. Williams, general manager of the First National, in which the reso- lution framed and subscribed to at the Chicago meeting of the delegates of. the sub-franchise holders, was repeated as the reason for the non- appearance of, and the refusal by, the First National executives to be present at any investigation of the internal affairs of the organization to t»e conducted by parties outside of the organization itself. The First National sub-franchise delegates in Chicago are reported as having gone on record as against any investigation of the finances of the association, or its business msthods by anyone outside of the association, on the ground it would five competitive organization a line on the inside of the business as first National Is conducting it A printed report of this Chicago First National "get together" and the sub-franchise contract as issued by that organization formed the basis of the attack which Senator Walker launched before several hun- dred exhibitors and the trade press representatives at the Astor meet- Senator Walker's talk occupied greater part of the afternoon the exclusion of the regular bus- es usually transacted by the T. Si C. C. After the reading of the refusal of the First National ex- ecutives to be a party to the discus- Men before the T. O. C. C, Senator Walker took the floor and started With the Chicago "get together" as the basis of his talk. Walker's Points He showed where the delegates from Eastern Pennsylvania, South New Jersey and Delaware presented a complaint at the Chicago meeting in which 15 specific charges were made, and stated their charges were not read at the meeting but were sidetr ked in the "zone committee meetings," which were held prior to the open convention. Ho held up the fact that in order that any sub- franchise holder might get a read- justment of the pro-rata charges, made on the individual on the de- termination of exhibition values of a picture and a readjustment of the same, the exhibitor was compelled to file a complete statement of his box ofTlee receipts and his expenses of operating with the First National, and then it would determine whether or not It would grant a reduction, or eventually declare an increase of the charge basis based on those re- port a Senator Walker's most definite statement during the afternoon was to the effect that, ns a result of this exposure of First Nation 1 method* in the open, within a week or so "there will be a definite pronounce- ment that exhibition values are com- ing down," so, that even if First Na- tional executives were not present. the meeting would not be in vain, 'or it would have had the purpose having done some good for the r *hibitor body of the industry. The only producer representative f those linked with Associated First KUlonal present was Felix Feist, •presenting Joseph Schenok, who leas* s the Norma and Constance 'tiRudKc productions ajul the Bus- ter Keaton comedies through the or- ganization. During the afternoon A scathing Arraignment of the rtait National and a terrific ripping tf t of their sun-franchise con- *t was delivered by New York g£u Senator Jamea Walker in an ress before the Theatre Own- Chamber of Commerce In the [otel Astor Tuesday afternoon. The ctskm was picked for a get-to- pther on the part of the First Na- lonal and Theatre Owners of Amer- by William Brandt, In an effort to bring about a settlement of the differences between the two factions. In the case of the Theatre Owners and Famous Players, the discussion of the differences before the T. b. a C. brought about an amicable ar- rangement under which F. P. has stec^ ^"^^t^thA^mpJHn^TuMl! ** mutualit y." »*><*~he~stated that"was **» a «w a mM nst ue *" the reason the First National had never taken the contract into court. What reason, there would he *e been for so doing he failed to mention at this particular stage of his ad- dress. The Senator took clause three of the contract which provides that the sub-franchise holder shall under the contract accept any picture which the First National shall have, be interesting in, distribute, offer to the exhibitor with such playing dates that the organization shall de- termine and at whatever price they shall fix, and stated that the exhib- itor had by signing the contract "de- livered everything to the First Na- tional except his wife and right to eternal salvation Pointing out the agreement under which the First National took over the productions of the Associated Producers, he stated the exhibitor sub-franchise holder had no "out" except to take whatever of those productions First National wanted to give him at whatever price it saw fit to determine, and in the event that it did not want to give him a production because it was of greater merit than the regular run of pic- tures, First National was at liberty to offer it under the terms of the contract In the open market and the opposition could take the picture and the sub-franchise holder would get the worst of it after he had played all the mediocre offerings. "We'll Get 'Em" "No matter what happens, wheth- er they come Into the open or not we'll gt 'em," he announced in tones that brought cheers from those as- sembled. The next point of attack was the placing of exhibition values on pic- tures by the organization. The first Anita Stewart release made by First National was given an exhibition value of $350,000, and the exhibitors playing the picture on the pro-rata charges made on that basis, accord- ing to the Senator, flooded the First National with complaints because they could not exhibit the pictures at the price asked and make money. He charged that the First National took no notice of the complaints and.even after the first year of the Stewart contract was completed, continued to place an exhibition value of the same proportion on the Stewart productions, atlhough it had been Informed by Itc exhibitor- members the pictures of this par- ticular star were not a box office draw. In making these declarations, Sen- ator Walker asked the trade press to soften them down as much as they could as it was not his inten- tion to attack the product of any producing organization or the draw- ing powers of any star. MacDonaM Values Following the statements about the Stewart productions the Senator Katharine. Macttonald pictures which originally had had an exhibition value of 1200,000 a production placed on them. Later in the face of com- plaints from exhibitor-members against this valuation the First Na- tional Executive Committee In- creased the exhibition value of the following pictures of this star to $350,000 per picture. He said certain representations were made by those who sold the subWranchise services contracts and stock jn the First National on the ground that this was to be the greatest protection measure ever made to exhibitors, had undoubtedly made misrepresentations, because the First National could not guar- antee exhibitors certain productions such as the Norma and Constance Talmadge features and the Marshall Nellan productions, because the con- tracts wtolch the organization held with the producers gave them the right to pass on all contracts for the exhibition of their own product and in the event that they saw fit Advances to producers and. royalties ...$.6399 Exchange operation ....... ,1476 Prints • -0893 Home Office expense .0436 Company profits ......... .0274 Interest on loans .0186 Advertising -0186 Taxes 0151 This was well, enough to show what became of every doilar spent, but Senator Walker stated what was wanted by the exhibitor mem- bers was a knowledge of How much came In. He next attacked the clause re- garding the continuance of the sub- franchise contract after June 30,1923, at the option of the exhibitor, pro- viding he does not give six months' notice prior to that date that he does not care to continue; the con- tract. If the exhibitor does not give such notice the contract automati- cally becomes effective until 1945. In that event the organization holds the right at any time after June 30, 1923, to "revise, alter or modify in any respect whatsoever this agree to cancel any exhibitors contract it 1^ „ " Senator Walker warned the was in their power to do so, and exhlbItor|S of what he called the therefore the promises the salesmen made in behalf of the sub-franchise contract that such pictures would be guaranteed, were misleading. He stated that in Buffalo an ex- hibitor that had been playing Buster Keaton comedies at $125 was forced danger of this clause, because, he said, it gave the company the right to change the contract so that it might be made to include any irk- some conditions in the event the executives of the association saw fit to exact them so that the holder to pay $750 for the pictures after WO uld have to refuse and then the Keaton had become a First National company would be able to dispose star. First took exception to this 1 0 f t he franchise elsewhere. and made a statement that Harold Franklin, the exhibitor in question, had originally had the pictures for »J25 and that he had voluntarily in- oppre~lon." creased hi. price on them to IS50 for , President Lelbcr'a S] one house and that he now was pay- ' ing $750 for three theatres. Feist Excepts Again the Theatre Owners of America waged against Famous Players, in which he went from one end of the country to the other, he in reality acted as an advance agent for the First National In their sales cam- paign for the sub-franchise, but he had done so unooaamously and much to his regret. First National's Statement On Wednesday-after the publica- tion of the rem:i. ka of Senator Wal- ker, the First National issued the following statement through ita 1 ' president, Robert Lieber. "It would seem from the phone calls coming ito our office from the trade press regarding the meeting held yesterday by the Theatre Own-' er8' Chamber of Commerce, In which Senator Walxer made an oratorical" attack upon this company, that a statement by us has become neces- sary. This company has acid, and still holds that ita relation with tha' franchise holders is a matter of in- dividual action between them and ourselvea We have a full realization of the serl.uness of this obligation and we shall continue to handle an^ ' complaints properly presented to us, with the full measure of consider- 1 ation that they deserve. This posi- tion, originally expounded by &«' executive officers, was ananlmously upheld by the delegate meeting of our franchise holders in Chicago. As far as we arc concerned, we con- sider this phase of the matter a closed incident, as far as a public discussion goes. "We do wish to make the state- ment here and now that sooner or later, everyone connected with this industry—whether exhibitor or- ganizations, 'trade papers, distrib- utor and producing organizations, or other component parts—will realize that the business as a whole is not to be helped by destructive measures and destructive tactics) that some men find as their only stock in trade." After this statement was issued plans were completed at the First National for the continuance of the meetings of the executive committee and the special committee, and the original franchise holders of the or- ganization at Atlantic City over the * week end. Weapon of Oppression "In reality," Senator Walker stated, "the sub-franchise contract He speech in Chicago, in which the executive pleaded £hat the exhibitor-members have faith in the organization and Another instance of Keaton book- by his faith communicate faith .to ing and increase of price Fiest took the other members. Faith in the Those attending the meeting left exception too was that of Loew in! executives, according to tho Senator, f 0r Atlantic City by special car on Cleveland, where Senator Walker could bo had by reviewing certain the Pennsylvania at 10 o'clock Frl- stated that Loew was now paying alleged communications of Harry d ay# $1,600 for the Keaton comedies, a sj Schwab,p . whom he referred to as At thIs mee ting the plans for the against a much smaller figure in thej tho "Pennsylvania music tax col- reorganization of the home office of past. Feist stated that heretofore»lector," and J. D. Williams from , t h e organization will be fully dis- what he said were their recorded ex- | Pn « H n* or^ ™r„««..«/i „.i*w pressions in the past. He read what purported...to bo these communica- tions. To Harry Schwablo he at- tributed this: "The only way to treat an exhibitor is to hit him on the head, take his money away from and J Loew had paid $600 for the pictures what nc said wcre in two theatres and now he was paying I860 for three hous*** The manner of placing exhibition values on productions that Senator Walker declared was unfair to the exhibitor-members of the First Na- tional was In the instance of "Pas- sion," which First National secured for $27,000 and on which an exhibi- tion value of more than half a mil- lion was placed, and also in the case of "Gypsy Blood" which cost First National $7,500, according to the Senator, and which has an exhibition value of $350,000 placed against it. cussed and compared with the plans that the organization la now oper- ating under. Incidentally, the mat- ter of the rearrangement of the sell- ing plans of the organization will also be under consideration. It has been rumored that the new un a ?V^ n. hCl1 1 re8pect . >?"' order of things may And Al. Licht- while J. D. Williams Is reported by man at the head of the sales organ- the Senator to have set himself Nation of the rompany, with J D down in black ad white with the following statement: "I will moke exhibitors the Janitors of their own theatres." As a further exposition of the proposition whether or not the ex- hibitor-members of the First Na- Paragraph No. 5 of the complaint tional ought to have faith in the ~ " ~ executives and their employes in the organization Senator Walker cited the case of H. A: Gungllng of Chi- cago, who, when trying to obtain an adjustment of a claim from the local exchange manager, Senator Walker said, was assaulted by the latter. A sworn affidavit of the exhibitor was read by the Senator In which charges of the alleged assault were made. Near the conclusion of his talk iSenator Walker stated that he re- vided up. Under this chart the dls-! B rettcd to say that in the first fight of the Pennsylvania delegates to the Chicago meeting was next brought up. In this complaint the Pennsylvania delegation asked for an accounting of the business done by the organization. In reply Harry Schwable, treasurer of the First Na- tional, is reported to have stated that it was "too big an o»*der," bit that the chart on the wall before the delegates showed where every dollar that the organization spent was di- PICTURE WITH JACK JOHNSON Jack Johnson has been engaged to star in a five-reel picture, entitled "For His Mother's Sake." to be pro- duced by Blaekburn-Valde Pictures, at the Ideal Studior in Fort Lee. Walter Hall wrote the scenario and will direct it. Johnson will receive $1,500 for his week's work in pictures, follow- ing which he goer, back to "The Passing Review," American wheel, as the added al tract ion. The cast of the Johnson picture wfll consist of i>oth whl'e and col- ored actors in support of Johnson. Johnson pWys in the film next week only. J LIONIZING BAY Charles Ray arrived in New York on Wednesday, this being his first visit to the big city; in fact, it is the first time that he has ever been east of Chicago. He was tendered the freedom of the city by Mayor Hylan on the steps of the City Hall, Wednesday noon, and Madge Evans, representing the motion picture in- dustry, welcomed him on behalf of the craft. Ray is to become a member of the Friars and a dinner is to be given in his honor at the club house on Dec. 11, after which he will re- turn to the coast. SPECIALS REDUCE PRICES Chicago, Nov. 28. "The Queen of Sheba." which suc- ceeded "Over the Hills" at the .Woods', with a two-a-day policy Williams retaining his position as general manager. This, however, was denied at the First National offices Wednesday. Another angle of complaint was raised In the First National ranks this week, and that came from the producers of the organization. It was stated that they felt that the committee that was appointed as a special, body contained two pro- ducer-exhibitor members of tha original franchise holders and that they could not give unbiased con- sideration to the needs of the or- ganization because of their interest ir their own productions. The special committee comprises E. V. Richards, New Orleans; Spy- ros Skouras, St. Louis; Col. Fred Levy, Louisville; Sol Lesser. Los Angeles, and Harry Crandall. Wash- ingtcn. It is to Col. Levy and Sol Lesser that the objections hive been raised, art they are interested together in the Jackie Coogan pro- ductions. Thus far the executive committee, on which Moc Mark, N. H. fJordon, and a $1.50 top after three days of ' Sam Kal7(> A „. Blook ailll 1L a that style of business, is back again | gchwalhe are acting, have passed to the 11 to 11 grind with the price of admission scaled at 5Or. and 7. r »c The picture is doing almost capa«Py business on the "grind." The scale of "Theodora" at the La Salle was also reduced after ten days of two-a-day at $ 1.. r >0 top to the same scale as the Fox pictures, with two performances remaining In vogue dally. on but one production for the cir- cuit. It is the Col. Selig-Sam Kor-k production, "The Ilosary." which has hecr. tal^cn for dlstrinution as a First National attraction without any advance to the producer.*. Sev- eral other productions arc under consideration Including "The Wan- dering Iioy," but there has been no decision reache on them. a« yet.