Boxoffice-October.01.1955

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this aibitration system sluiU bt- i-viclonccd
by a \vrittcni2> request adressed to the distributor's*
home office or cxchaniie. and such
request will be deemed to have been refused
lai when the exhibitor has received a written
refusal or ib^ If not sranted within 21 days
after the receipt by the distributor* of such
request.
recognized that the licensing of feature
It is
pictures by run is essential In the dis-
tribution and exhibition of motion pictures,
and arbitrators in deciding run complaint.';
shall give effect to this principle. Runs means
the successive exhibitions of motion pictures
in a given area, first run being the first
exhibition in that area, second run being the
next subsequent exhibition therein, and so on.
In determining whether the exhibitor's
complaint is established by the evidence, the
ai-bitrators shall take into consideration,
among other things, the following factors and
accord to them the importance and weight
to which each is entitled, regardless of the
order in which they are listed
il> The admission prices of the theatres as
set by the exhibitor':
The character and location of the theatres
(ill
involved, including the size, type of en-
tertainment, appointments, transit facilities,
etc.:
The policy of operation of the theatres
iiil>
involved, such as the showing of double
features, gift nights, giveaways, premiums,
cut-rate ticket-s. lotteries, etc.:
(ivi The capacity of each theatre for producing
revenue for the distributor*:
I VI The character and extent of the area
and population each theatre serves:
(vi> The competitive condition in the area
in which the theatres are located:
iviii The character, financial responsibility,
and ability of the exhibitor OF>erating each
theatre and his reputation generally in the
industry and in the community:
iviiii The policy under which each of the
theatres has been operated and the policy
under which the complainant proposes to
operat* his said theatre if he obtains the
run requested:
iix> All other business considerations.
The power of the arbitrators in decidine
any such controversy shall be as follows:
(a> If the arbitrators find in favor of the
distributor* they shall make an award dismissing
the complaint:
lb) If the arbitrators find in favor of the
complainant exhibitor, they shall make an
award directing that the respondent distributor*
in good faith afford the complainant an
opportunity to license feature pictures for
exhibition in his theatre on the desired run.
equal to the opportunity afforded the exhibitor
operating a competing theatre to whom the
pictures of such distributor are then being
licensed on such run:
(c) If the complainant asked for damages
and the arbitrators find in hLs favor, they
may also award him damages but only for
the period of time during which he was denied
such opportunity to license the pictures, and
subject to the provisions of Article III.
Any distributor, the complaining exhibitor
or any intervening exhibitor affected by such
an award may institute a further arbitration
proceeding for a modification thereof upon
the ground that, since the making of the
•.vard. conditions with respect to the theatres
volved therein have so changed a.s to warmodification.
In the event that the
: bitrators find there has been such a change
shall make a new award in regard to
:-.e run in question to take effect thereafter,
out no damages shall be awarded. The burden
of proving such change shall be upon the
party a.sserting It. Proceedings to modify
an award upon the ground of changed conditions
.shall follow the rules of practice and
procedure prescribed in Article V.
(2) Wherever in this agreement, except in Articles
and VI, notice or communication by a distributor
an exhibitor is required to be, or moy be, made
• writing, it may (except where the context indicates
•herwise) l>e by tclegrom.
SKt TIO.\ 3— I O.MrKTirn K ItlDDINii
Controversies arising upon the complaint
of an exhibitor that, subsequent to the inauguration
of the arbitration system —
A. A distributor. In llccnsiiiK feature motion
pictures by means of competitive bidding,
licensed to another exhibitor operating
a theatre in substantial competition with
complainant's theatre a feature or features,
on which complainant al.so made an offer
or offers, which license to such other exhibitor
wa.s made otherwl.se than theatre by theatre,
solely upon the merits and without discrimination
in favor of such competing theatre:
or
B. A distributor has Instituted competitive
bidding In any competitive area or situation
except
( 1 > upon the WTltten request of one or more
of the exhibitors In any such area or situation:
or,
1 11 1 upon the WTltten request of an exhibitor
in any area or situation for a run of a
picture or pictures which the distributor is
propo.slng to license on such run to another
exhibitor or exhibitors In such area or situation:
or,
(iiit to comply with the judgment, decree
or order of a court of competent jurisdiction:
or,
livi in good faith to protect itself where
it has reasonable grounds to believe that there
is collusion among exhibitors in such area or
situation in the licensing of its pictures: or,
C. A distributor has breached any of
the following rules in conducting competitive
bidding:
(ii The Invitation for an exhibitor to submit
an offer for the picture or pictures described
in the invitation shall specify a closing date
for bids (hereinafter called the closing date),
which shall be not less than ten days after
the mailing of the invitation, and only offers
or revised offers submitted in pursuance of
.such invitation, received on or before the
closing date, shall be considered:
If prior to the closing date for bids, a distributor
has not afforded an opportunity to
the exhibitor to view, at a trade show or other
screening, the picture or pictures referred to
in the invitation to bid, then the distributor,
at the exhibitor's written request, shall afford
the exhibitor an opportunity to view such picture
or pictures in the exchange city of the
distributor.
(ii) Any exhibitor submitting an offer for
any designated picture or pictures, in response
to an invitation by the distributor,
may request in writing (but under separate
cover) at the time he submits his offer, that
the successful offer for such picture or pictures
shall be revealed to the exhibitor making
such request and the distributor agrees
to do so at the exchange office serving the
theatre for which such exhibitor submitted
said offer, within 14 days after there has
been an award of the picture or pictures by
the distributor, and at no other time.
I Hi) Nothing contained in this section
shall be deemed to compel the distributor to
accept an offer which it considers to be
inadequate and the distributor may reject
all offers: when, however, all offers are rejected
the notice of rejection shall state the
reason therefor and in such case the feature
motion picture shall be made available In
accordance with the provisions of this subdivision
C to exhibitors, including tho.se who
submitted offers in the first instance, for a
new offer: provided, however, if there be
only one offer submitted, and that one offer
is rejected, the distributor may, at its option,
in lieu of the foregoing, negotiate with and
license the motion picture to the exhibitor
who submitted said offer,
(iv) Only offers in writing can be considered
:
(V) The distributor shall within 14 days
after the closing date. If any offers have been
submitted on or before the closing date, announce
acceptance to the maker of the
accepted offer or announce to all bidders rejection
of all offers:
(vi) If the new offers are also rejected, the
(ll.itrlbutor may thereafter, at ils
iieKotlat with the exhibitor nutklng i:
offer and license the motion plctin
exhibitor If the distributor
tcrm.s .satisfactory, or may negc
license the picture to such othr;
exhibitors as the distributor may chuu.t
(vlli If no offers arc submitted, the dl
trlbutor may Ilcen.se the picture to any exhibitor
It choases upon terms acceptable !
the distributor:
shall be subject to arbitration.
The rules and principles set forth In thl
Section 3 shall have application only In arbitration
procecding.s under this section.
Nothing contained In this section shall bo
construed to prevent a distributor from .selecting
It-s own customers In bona fide transactions
and not In violation of any provision
of this agreement.
Nothing contained In this .section shall bt
construed to mean or Intend to mean that a
distributor may lastltute competitive blddlniotherwise
than under the terms and conditions
as set forth In this section.
The power of the arbitrators In dccldlnt'
any controversy under thLs section .shall b<
as follows:
(ai If the arbitrators find in favor of the
distributor, they shall dismiss the complaint
(b) If the complaint Involved Is the first Ut
be filed by the complainant agalast the distributor
under sub-division B of this section
and the arbitrators find in favor of the complainant,
they shall make an award directing
the distributor thereafter to cease and desist
from competitive bidding In the competitive
area or situation until such time as the
institution of competitive bidding in .such
competitive area or situation would not violate
the provisions of said sub-dlvlslon:
(ci If the complaint Involved Is the first
to be filed by the complainant against the
distributor under sub-division C of this .section,
and the arbitrators find in favor of the
complainant, they shall make an award directing
the distributor thereafter to conduct
competitive bidding affecting the complainant
in accordance with the provisions of said subdivision:
(dl If it shall appear that an award has
been made in favor of the complainant with
respect to the same theatre in a previous
arbitration with the same distributor imder
the same sub-division of this .section, and
the arbitrators shall find In complainant's
favor in the instant case, they may award
damages under the provisions of Article III
except that exemplary damages may be
awarded only in respect of violations under
sub-division A of this Section 3.
If in any proceeding under this section the
arbitrators shall find that the competitive
bidding was conducted by the distributor
fairly and in accordance with .sound business
practice and that there was no piu-pose to
discriminate against the complainant or to
favor the exhibitor to whom the picture In
question was licensed, they shall find In favor
of the distributor: and, in the absence of any
showing of a violation of the rules and
principles, the arbitrators .shall not attempt
to substitute their judgment for that of the
distributor as to which of the several offers
was best or as to the propriety of rejectlni;
all bids on grounds of Inadequacy.
:
SECTION 4—CONDITIONING ONE
LICENSE IPON ANOTIIER
Controversies arising upon the complain'
of an exhibitor that
(ai the distributor In licensing a particular
feature or group of features has dlrrotI\
or in any manner conditioned such ;
upon the complainant exhibitor licen ;:
or more other features, or upon mm;
licensing one or more short sul
reels, trailers or .serials (herr;:
called "shorts"), or upon compl.i;
Ing re-Issues, westerns or forcitrn^ •'..•vcollectively
called "forelgns"): or
(b) the distributor has directly or in any
manner refu.sed to license to complainant exhibitor
a particular feature or group of fea-
BOXOFTICE ;: October 1, 1955 35