FILM COMPANIES SUED

Poverty Bay Herald, Volume LXV, Issue 19700, 4 August 1938, Page 7

FILM COMPANIES SUED

ALLEGED MONOPOLY PRODUCERS OWN THEATRES WASHINGTON, July 21. The Department of Justice has filed a civil action under the anti-trust legislation against eight major motion picture producers, 29 subsidiary or associated corporations, and 132 officers or directors. i Seeking a divorce of the production, distribution, and exhibition phases of of the industry, the . Government is asking for an equity decree requiring the major companies to divest themselves of the ownership of theatres or of the production and ; distribution facilities. It states that the alleged exercise of monopolistic power by/the defendants “has a tendency to drive independent theatres out of business or to compel them to sell to producer-own-ed theatre chains on the latter’s terms.” 1 j; . r “Vd : r' : N'T The companies named are Paramount Pictures Inc., Loew’s Inc., the Ixwing Trust Company, as trustee in bankruptcy for the R.KIOT Corporation, Warner Brothers Pictures Inc., Twentieth Century Fox Film Corporation, the Columbia Pictures Corporation, the Universal Corporation, and United Artists’ Corporation. The suit has had a depressing effect on the stock market. Steel, motor, oil, and specialities shares declined, with the amusement section most heavily hit. Paramount first preferred lost 10 points; Loew’s, four points; and others up to two points. Mr. Hay’s Statement Among individual producers mentioned in the suit are Charles Chaplin, Douglas Fairbanks, and Mary Pickford. A statement by Mr.- Will;. Hays, president of the Motion Picture "Producers and Distributors of America, defends the industry against the Government’s charges that competition has been stifled. . ~ .■ - „ 1 “Not merely the methods, but much of the structure of the industry are he result of necessity,” he declares. "The industry welcomes the prospect of a comprehensive, fair, and coriclu?ive endeavour to clarify the application of the existing law to trade cus--oms inherent in the development of .he motion picture industry."