Boxoffice-August.06.1979

General Cinema suing
former senior officer
Pretrial hearings continued through July in
Dade County, Fla., in General Cinema Corps
Divil suit against a former senior officer accus
sd of diverting nearly $6 million to his private
ly owned company.
According to a Dade County circuit court
clerk, criminal action against the former of
ficial is pending in federal court in Florida. No
other information was immediately available
011 the federal case.
ON JUNE 14 General Cinema, the coun
Iry's largest exhibitor circuit with more than
800 screens, filed suit against Herbert Paige,
who resigned last December as vice president
and director of the company. In its sun. GCC
alleged that Paige diverted $5.9 million in
"allowances, claims and credits" from Crown,
Cork and Seal, a major supplier of bottling
equipment to General Beverage Corp., a GCC
subsidiary.
GCC, whose audit committee has been pro
bing the matter since last fall, said Paige
pocketed 40 payments during eight years by
telling Crown that Pasha Service Co., the
company receiving the $5.9 million in checks.
was a subsidiary of GCC.
Paige is the principal stockholder in Pasha,
owning 90 percent of the company's shares
It has been reported that Paige also obtain
ed a $1 million mortgage from a finance sub
sidiary of Crown for an office building project
in Coral Gables, Fla.. Paige's home. According
to Crown, Cork and Seal president John
Luviano. Crown Financial Corp. is supposed
to lend exclusively to soft drink bottlers.
AT THE END of June, Circuit Judge
James Ernest denied GCC's motion for a tern
porary injunction preventing Paige from sell
ing part of his interest in the Coral Gables of
lice building. In May Paige reputedly tried to
draw some of his capital out of the building.
The suit became public in mid June at the
time of GCC's second quarterly report for
1979, which announced net earnings of $8.2,
up from $4.6 million recorded in 1978.
SHAREHOLDERS WERE TOLD that
the first hall earnings reflected "an extraor
dinary credit" of nearly $2 million, the value
of the expected recovery of the diverted funds.
An official of GCC's financial public rela
tions company. Newsome & Co., said the
company was certain the funds would be
recouped through an agreement with Crown.
Cork and Seal The official said that including
an extraordinary credit of this sort was a
"generally accepted accounting practice" and
not a premature move on the part of GCC.
Court gives Allied Artists
Aug. 15 deadline to pay rent
NEW YORK— Bankruptcy Judge Stanley
Lesser has given Allied Artists Pictures until
Aug. 15 to pay the back rent it owes the Col
umbia Broadcasting System. AAP's landlord
for a warehouse at 503 W. 56th Street.
CBS attorney Ann H. Applebaum told
Judge Lesser July 3 1 that A AP has not paid its
$1.000 a month rent for May, June, or July.
She said the company should find other
premises because CBS needs the property for
its own purposes.
Allied Artists Pictures, along with parent
company Allied Artists Industries and sub
sidiary Allied Artists Television, is in the
fourth month of Chapter XI reorganization
proceedings.
Judge Lesser directed AAP attorney Jon
Arnason and the CBS attorney to follow
through on their proposed agreement that
AAP pay $1,500 immediately and the balance
of the back rent plus the rent for
August—$2,500—by Aug. 15.
Lesser added that September's rent should
be paid no later than Sept. 10. and ordered
AAP to give CBS a month's deposit by the end
of that month. CBS also argued for March's
rent—a debt incurred before Allied's April 4
bankruptcy petition and one which Lesser
pointed out could be satisfied with the security
payment.
Uncertainty shrouds 20th-Fox
as Ladd takes forced vacation
HOLLYWOOD-'Wait and See" was the
watchword at 20th Century Fox last week as
Alan Ladd Jr., president of the film division,
and his two lop aides sat out a vacat ion period
at the orders of their boss, Dennis C. Stanfill,
chairman and chief executive.
Their vacations were to end July 31. but as
that date neared studio brass who were
queried about their status could only say,
"Well have to wait and see."
Ladd and his (wo associates were ordered lo
leave the studio on July 25 on forced vaca
tions. Stanfill said he would advise them July
31 on when they should return
Ladd and his aides. Jay Kanter. senior vice
president of worldwide production, and
GarethWigan. vice president of worldwide
production, had previously announced they
would not renew their contracts which expire
next year. On July 4 they announced plans to
go into independent production as a separate
unit within Warner Bros.
Speculation was thai Stanfill ordered the
trio "off the lot" to prepare for announcement
of their successors, which was expected to be
made the weekend of July 27 29 at a board of
directors meeting in Aspen. Colo But no an
nouncement came out of that meeting, and
Hollywood's guessing game as to their sue
cessors continued.
Rating high on the "It's Going to Be" list
was a teaming of Ashley Boone, senior vice
president of domestic distribution and
marketing, and Sandy Lieberman. vice presi
dent in charge of European production, wjio
was said to be in line for Ladd's top spot.
Testimony ends in Ohio bidding trial
COLUMBUS. Ohio—Testimony in the trial
challenging the constitutionality of Ohio's
anti-blind bid statute ended July 27 in U.S.
District Coun here.
The trial will be in temporary recess until
Sept. 12, the date Judge Robert M. Duncan
has set as the filing deadline for submitting
final briefs in the case. Oral arguments are
scheduled to begin soon after the filing
deadline. Judge Duncan is expected to issue
his opinion approximately two weeks after the
conclusion of the oral arguments.
An attorney from the state attorney
general's office— representing the defendant,
the state of Ohio, in the case—estimated that
it would be a minimum of November before a
final decision is reached.
BOXOFFICE/AUGUST 6, 1979
industry briefs
$2 million developmentfundfor IFT
International Film Trading Co. has been launched by a consortium of international
bankers. Ibrahim Moussa has been named consultant and has full creative control of the
company which is to be based in Zurich, Switzerland.
IFT has set up a $2 million development fund to acquire film properties and hire screen
writers and directors. Already acquired are "Night Tennis," a novel by Annabel Davis-Goff,
and "The Expendable Spy," Jack D. Hunter's novel of international intrigue. Hunter's World
War I novel, "The B'ue Max." was a 1 966 film made by 20th Century Fox. Also picked up is
Ross Thomas' novel, "The Fools in Town Are on Our Side."
Moussa has been developing motion picture projects for Paramount Pictures, and under
his deal with the studio Paramount will have first refusal on IFT projects.
UA TC considering private ownership
United Artists Theatre Circuit, one of the country's largest with nearly 700 screens nationally,
has disclosed that it is looking into the possibilityof becoming a privately held company.
The company's board of directors has appointed a committee to study the details of such a
transaction.
U ATC "s principal stockholders, Robert A. Naify. chairman and president of the company,
and his brother Marshall, chairman of the executive committee, own or control 5 1
percent of
the company's outstanding shares of common stock. In order for the Naifys to acquire the remaining
49 percent of the company's outstanding shares, thus consummating a financial
merger that would make the company private, approval would have to be granted by the
board of directors, the stockholders and the Naifys. according to U ATC financial vice president
Gladstone T. Whitman.
The announcement follows closely the release of U ATC's nine month financial statement,
which revealed that the company's net income for the 40 weeks ended June 5 was $5.7
million, or $3.22 per share, a gain of 95 percent from the $2.9 million, or $1.65 a share,
reported for the same period in 1978.
20th-Fox suffers net earnings drop
Despite the initial smash success of its summer science fiction thriller "Alien," 20th
Century-Fox has attributed a sharp drop in filmed entertainment revenues and earnings as
the prime contributing factor to a 50 percent plunge in net earnings for the second quarter
and a modest decline over the sixth month period that ended June 30.
Net earnings for the second quarter dropped substantially to $7,774,000, or 91 cents per
share, from the $15,476,000, or $1.95 per share, earned during the second quarter of 1978.
For the first six months of 1 979. the company reported net earnings of $26,864,000, or $3.24
per share, compared with $32,962,000, or $4.16 per share, for the same period a year earlier.
Revenues for the second quarter of 1979 were $147,152,000, against $149,196,000 in
1978. Six-month 1979 revenues totaled $306,698,000 down from $308,129,000 for the
similar 1978 period.
Dennis C. Stanfill, chairman of the board and chief executive officer, attributed this year's
second-quarter decline to lower filmed entertainment revenues and earnings compared with
high levels achieved during the same 1978 period.
Columbia sets gross billings record
Columbia Pictures International established an all-time company gross billings record of
more than $107 million for the fiscal year that ended June 30, according to figures released
by Patrick M. Williamson, president.
The new record topped the one established in fiscal 1978, but came in a regular 52-week
fiscal year while the previous record was set during a 53-week accounting period. In addition,
the previous year included the launchings of the two biggest successes in Columbia history,
"Close Encounters of the Third Kind." and "The Deep".
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