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Herman Levy, General Counsel for TOA, to Carolina Exhibitors:<br />
Whatever the decision, and of this you may be certain, it will be more difficult<br />
for you to run your business after the decision is rendered than it is right now.<br />
sible monopoly or deadlocks over terms of<br />
sale,<br />
district<br />
these can and should be decided by the<br />
court.<br />
Divorcement, and the bans on crosslicensing<br />
and theatre expansion are unnecessary<br />
because the decree provides adequate<br />
relief from trade practice abuses through its<br />
ban on price-fixing, master and formula<br />
deals, franchises and clearance restrictions.<br />
In addition all of the Big Five except Paramount<br />
accept competitive bidding as a positive<br />
method of stimulating competition.<br />
Competitive bidding eliminates the old<br />
customer philosophy and the rigid setup<br />
formerly characterizing selling.<br />
They denied that large circuits or affiliated<br />
circuits will bid for films just to keep them<br />
away from independents.<br />
The friends of bidding also pointed out that<br />
there is nothing in our laws requiring that<br />
every theatre must be placed on equal financial<br />
footing with its competitor. Consequently<br />
there is nothing illegal or wrong in one theatre<br />
outbidding another because of its<br />
economic position.<br />
As to disputes over bidding, they could be<br />
settled by an arbitration system that will<br />
probably have the support of the Little Three<br />
companies as well as the Big Five.<br />
Little<br />
Three Replies<br />
UA. Columbia and Universal actually replied<br />
to the government's answers rather than<br />
to its appeal brief. They attacked the way the<br />
government tied in franchise agreements with<br />
block booking. UA never sold in blocks; Columbia<br />
and Universal long sold their product<br />
by the season, but claimed that these were<br />
not conditional sales, were not forms of<br />
franchises, and were legal, wholesale methods<br />
of distribution. Universal said there was<br />
nothing illegal about franchising which enabled<br />
a nontheatre owning distributor to<br />
compete -with a theatre-owning distributor.<br />
North Central Accused<br />
Of Theatre Monopoly'<br />
MINNEAPOLIS—North Central Allied, long<br />
a foe of alleged monopoly in the motion<br />
picture industry, this week found itself accused<br />
of monopoly.<br />
The charge was made by attorney John<br />
Goldie, who appeared before the city council<br />
in behalf of Ray Secrest's application to<br />
transfer his Princess Theatre license to a<br />
nearby abandoned school building, which he<br />
wants to convert to a theatre. His lease on<br />
tJie Princess expires soon and will be taken<br />
over by a brother of Ted Mann, independent<br />
circuit operator and Allied leader.<br />
Unless the license is given to Secrest, said<br />
Goldie, "it will be filched by one of the<br />
monopolistic chains." North Central Allied<br />
has opposed additional permits here for more<br />
than a decade and Goldie charged this action<br />
runs counter to the American free enterprise<br />
system. The council took no action<br />
and failed to hear clergymen and AFL spokesmen<br />
who came to support Secrest's bid.<br />
BOXOFHCE : : February 7, 1948<br />
TOA and Ascap Agree<br />
On New Licensing Fees<br />
NEW YORK—After five months of negotiation. Theatre Owners of America and<br />
Ascap have reached an agreement on a ten-year rate formula for theatres. Ascap negotiators<br />
have promised to recommend it to the board and expect its early approval. TOA<br />
executives will recommend its acceptance to all regional units.<br />
It is understood the Department of Justice will not interfere with execution of the<br />
plan in case Allied members refuse to accept it.<br />
The rate scheduled is as follows:<br />
Theatres Former Rate New Rate<br />
499 Seats and under 10 .10 Per Seat No Change<br />
500-799 Seats 10 .12y2 Per Seat 21/2 up<br />
800-1,599 Seats 15 .19 Per Seat 4 Cents up<br />
1,599 Seats and upwards 20 .25 Per Seat 5 Cents up<br />
These rates are effective March 15 or at the expiration of any current contract beyond<br />
that date.<br />
Ascap reserves the right to set special scales for theatres with continuous live talent<br />
policies. Fifty per cent of the above rates will apply where a theatre operates three days<br />
a week or less.<br />
This annoimcement terminated five months of negotiations between Ascap and TOA.<br />
Negotiations started in September following Ascap's announcement of new rates on a<br />
seat admission price basis, which would have resulted in new rates considerably higher<br />
than those currently announced.<br />
Court Orders Records<br />
In Jackson PL Case<br />
CHICAGO—Judge Michael L. Igoe of U.S.<br />
disti-ict court has ordered six defendants in<br />
the Jackson Park case to produce records on<br />
their dealings with Chicago theatres to determine<br />
whether certain distribution practices<br />
are being continued in violation of the<br />
Chicago decree.<br />
The controversial matter was in the court<br />
again as a result of a petition for civil and<br />
criminal contempt citations against the defendants<br />
filed by Thomas McConnell, counsel<br />
for the Jackson Park Theatre, who listed<br />
more than a dozen alleged violations of the<br />
court order.<br />
McConnell told the court that the records<br />
would show that the Jackson Park Theatre<br />
was charged a higher rate tor a picture than<br />
a north side theatre and that "clearance<br />
periods" are being maintained during which<br />
pictures may not be shown in outlying theatres<br />
after Loop runs.<br />
When attorneys for the distributors protested<br />
that the decree applied only to the<br />
Loop and south side theatres in the vicinity<br />
of the Jackson Park Theatre, the judge dismissed<br />
this theory as "too narrow." He said<br />
that if the situation as outlined by McConnell<br />
is true, it is a direct violation of the<br />
decree.<br />
He declared :<br />
into,<br />
"This matter should be looked<br />
either here or by a grand jury."<br />
There was no question here that the Jackson<br />
Park decision and the subsequent decree<br />
was having reverberations not only in Chicago<br />
but elsewhere. McConnell said he is<br />
filing three more antitrust actions in such<br />
widely separated areas as Cleveland, Indianapolis<br />
and Dallas.<br />
In the Chicago district, several changes<br />
became evident this week. The Monroe Theatre,<br />
operated by James N. Jovan, heretofore<br />
a B house, has obtained MGM's "Desire<br />
Me" for first run starting February 18. It<br />
also was announced that the Garrick. a<br />
Balaban & Katz property which has been<br />
a first run theatre with an admission policy<br />
of 95 cents and $1.25 for roadshows, will drop<br />
to a policy of two third run films on each<br />
program with a scale of 37 cents to 1 p. m.,<br />
50 cents to 5 p. m., and 67 cents evenings,<br />
plus tax.<br />
McConnell, who last week became counsel<br />
for Allied of Illinois, announced that the first<br />
of the three contemplated suits will be filed<br />
in Cleveland. This suit involves the Tascarawas<br />
Amusement Co. vs. the distributors<br />
and the Shea circuit which has houses In<br />
Dover and New Philadelphia, Ohio. The brief<br />
will contend that the majors, with the exception<br />
of Paramount and Warners, have<br />
refused to grant day-and-date runs with the<br />
Shea theatres.
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