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Hollywood Renegades
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Cobblestone Entertainment.
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Hollywood Renegades:

The Society of Independent Motion Picture Producers

by J. A. Aberdeen

 

 

 

 

CHAPTER 1: Introduction

 

Hollywood 1939

 

By the time the movie moguls celebrated the golden year of the American film golden age, Hollywood had perfected the most complete and complex system of filmmaking in existence. Each major movie company had vast resources that were coordinated in such a way to give the studio authority over every aspect of film, from the beginning of a story idea to the actual showing in theaters. This highly-controlled process was known as the Hollywood studio system.

            Decades of merger and consolidation gave rise to eight corporations that dominated the film market—Paramount, Metro-Goldwyn-Mayer, Twentieth Century-Fox, Warner Bros., RKO, Universal, Columbia, and United Artists. In Los Angeles these majors operated the world’s most illustrious film factories with a virtual lock on talent contracts. From New York, their corporate offices controlled film marketing and distribution. And across the country, studio-owned theater chains dictated the nation’s box office. The studio system enabled the eight film giants to control a combined 95 percent of all industry revenue with a façade of glamour and showmanship that obscured one of the most potent oligopolies in United States corporate history. The domination of the American film market was so absolute that no film could feasibly receive a national release without going through one of the eight major distributors. The system also precluded the work of any filmmaker who wished to operate independent of a major studio.

            The grand old studio system survived government legislation, economic depression, organized labor, and wartime conflict. But it was challenged by a group of eight producers—Charles Chaplin, Walt Disney, Samuel Goldwyn, Alexander Korda, Mary Pickford, David O. Selznick, Walter Wanger, and Orson Welles—who despised the en-masse filmmaking of the major studios. The producers had grown weary of the unsuccessful attempts of the government to curb the power of the vertically-integrated corporations. These filmmakers joined together to form an association of independents designed to end the assembly-line studio methodology, and replace it with a new structure based on independent film production and single-film units focused on creating quality entertainment. By the time they had finished, the old-time Hollywood studio system had shriveled and the stranglehold was broken. Hollywood Renegades is the story of this group—the Society of Independent Motion Picture Producers (SIMPP).

 

 
All save one of the founding members of SIMPP are represented in this photo of the United Artists producers in February 1936. Left to right: Charles Chaplin, Samuel Goldwyn, Jock Whitney, David O. Selznick, Mary Pickford, Walter Wanger, Jesse L. Lasky, Douglas Fairbanks, and Roy Disney.
Independent production, as practiced by SIMPP, meant that a producer would operate a company that would enter into a distribution deal with a Hollywood studio, but remain off of the studio payroll. The filmmakers would finance their own movies, develop their own projects, hire their own talent, and make their own films without any studio interference. When film production was complete, then a major studio would serve as distributor, charging a fee (usually between 15 and 35 percent of the box office), and the independent producer would receive a share of the profits.

            These independent producers of old Hollywood were not art-house filmmakers nor champions of avant-garde cinema. They were showmen; their specialty was the “prestige picture”—the A-class movie with large budgets and high profit potential. Unlike the major Hollywood film factories that released upwards of 50 features each year, the independent producers concentrated on only one or two annual releases, leaving the independents in a far more vulnerable position than the large studios which could absorb the costs of a box office bomb.

            “There are two kinds of producers,” Sam Goldwyn explained. “One is a film manufacturer who turns out many pictures, some of them good, more of them not so good. I once tried being a film manufacturer but I didn’t like it. There were too many pictures going out under my name which were not satisfactory to me. Since then, I’ve tried to be the other kind of producer, making fewer pictures but each one the best I could make it.”

            When David O. Selznick went independent, he told his partners, “It is my opinion, generally speaking, and from long observation, that there are only two kinds of merchandise that can be made profitably in this business—either the very cheap pictures or the expensive pictures. . . . If we don’t deliver really topnotch product, we are not going to get terms and we are going to take a terrible beating after the first few pictures. There is no alternative open to us but to attempt to compete with the very best.”

            Most of the producers believed that prestige film production was the only way they could distinguish their material. “I can’t afford to make a cheap picture,” Alexander Korda, with his characteristic whimsy, was fond of saying. The independents produced only a fraction of Hollywood’s total films, but their batting average generated a high-profile reputation among their peers, and their films have become memorable classics.

            A case in point was 1939, the year which was known for its top-flight Hollywood studio classics including The Wizard of Oz (MGM), Mr. Smith Goes to Washington (Columbia), Union Pacific (Paramount), and Dark Victory (Warner). But among the year’s most significant releases were out-of-house productions, by those who, two years later, would found the Society of Independent Motion Picture Producers: Samuel Goldwyn’s Wuthering Heights, Walter Wanger’s Stagecoach, and David O. Selznick’s epic paragon Gone With the Wind. Amidst formidable competition, their films were remarkable both as blockbusters and cinematic benchmarks.

            In old Hollywood, just as in modern Hollywood, there were any number of independent-type arrangements, and the various terms fluctuated considerably. In some cases, the independent deals involved financing from the distributor or the use of the studio backlot, which meant that independence was a relative ideal. Walter Wanger facetiously defined an independent producer as someone who is dependent on the banks, the press, the distributors, and ultimately the public. Even as independents, the SIMPP producers worked alongside the major studios, frequently borrowed from the studio pools of movie stars, and depended heavily on the studio-owned theater chains. Though they operated within the industry mainstream, they flaunted their production freedom from the studio system and continually sought to undermine the vertically-integrated corporations.

            During the 1920s and 1930s, the independent movement tested the limitations the studio system, but the Hollywood giants proved resilient. Part of the difficulty in bringing monopoly charges against the major studios was that the Big Eight stranglehold did not appear as dominant on paper as it was in practice. Only five of the Big Eight owned their own theater chains, for a combined total of about 16 percent of all of the domestic movie theaters. However, the studios turned this minority share into an exhibition monopoly by concentrating their theater holdings in key metropolitan areas which generated the most revenue. In 1939, the Hollywood studios controlled 126 of the nation’s 163 most prestigious first run theaters. Furthermore, the Big Eight companies showed preference to each other’s films, allowing them to suppress competition. This gave the major studios the power to arbitrarily shut out any outside filmmaker, independent or otherwise. A big budget independent film was considered a doomed venture without a Big Eight distribution deal. Even the banks refused to loan money to a production company unless the producer secured a major distribution contract first.

            Notwithstanding these disadvantages, the independent producers were criticized for their close ties to the studios, and frequently were brought under the same condemnation as the Big Eight. After all, some of the most high-profile SIMPP members were founders and/or owners of United Artists, one the major distributors. Critics of SIMPP claimed that “independent producer” was a self-styled term that misrepresented the true relationship between the filmmakers and the studios. To complicate the situation, the trade publications applied the designation “independent” in a rather loose fashion, often to describe a studio filmmaker or performer whose contract provided some amount of creative control.

            The independents did not condemn film studios per se; they despised the studio system which made assembly line films and engendered monopoly control. This self-contradiction became a unique dynamic of the SIMPP movement. The producers professed their autonomy from the studio system but maintained close ties with the major distributors in a resentful manner. Consequently, the independent producers spent a great deal of effort trying to distance themselves from the vertically-integrated Hollywood giants. The creation of SIMPP helped the independents to disassociate themselves from the film oligopoly and project an image of defiance in the industry.

            The Society believed that its mission was logical: that films should be made, marketed, and shown as individual works—creatively overseen by a single individual. SIMPP sought to make independent production, rather than studio filmmaking, the new paradigm for Hollywood. To do so would require the upheaval of the studio system.

 

The Society of Independent Motion Picture Producers had its origin in the Hollywood antitrust case that enveloped the American film industry in the late 1930s. Acting upon repeated complaints from independent producers and small theater-owners, the United States Department of Justice initiated an antitrust suit against the eight major studios in July 1938. The attorney general accused the studios of creating an illegal conspiracy in restraint of trade by monopolizing production, distribution, and exhibition. The suit, one of the largest antitrust cases ever filed by the government against an industry, took its name after the biggest of the eight defendants, and became known as the Paramount case [United States v. Paramount Pictures, Inc. et al, 334 U.S. 131 (1948)].

            The eight majors were divided into two groups. The theater-owning companies, known as the Big Five, were Paramount Pictures Inc., Loew’s Inc. (parent company of MGM), Twentieth Century-Fox Film Corporation, Warner Bros. Pictures Inc., and RKO-Radio Pictures Inc. The Little Three—Universal Pictures Company Inc., Columbia Pictures Corporation, and United Artists Corporation—did not own theaters, but were alleged co-conspirators who upheld a supporting role in the industry, completed the oligopoly, and claimed a portion of the film bounty. The Justice Department demanded that the eight studios cease all anti-competitive practices and that the Big Five “divest themselves of all interest and ownership, both direct and indirect, in theatres and theatre holdings.”

            With the Hollywood studios on one side, and the independent producers, small theater owners, and U.S. government on the other, industry conflict continued to intensify as the case proceeded to trial in 1940. The independent producers awaited the studio system’s day of reckoning, and were stunned when, only one week into preliminary arguments, the studios cut a deal with the government.

            Known as the Consent Decree of 1940, the agreement between the Big Five and the Justice Department permitted the studios to keep their theater chains in exchange for the studios’ promise to limit certain monopolistic practices. Eager to avoid a lengthy trial with potentially devastating effects, the studios successfully launched the first of a long series of compromises and stall tactics that postponed the independents’ triumph for over ten years.

            Although several key independent producers participated in the early stages of the antitrust case, the Paramount suit before World War II had focused primarily on the woes of the independent exhibitors—the theater chains which were not affiliated with the Hollywood studios. To the independent producers, the advent of a consent decree proved that they could not trust the government and the independent theaters to enact a judgement equitable to all independent parties. The situation worsened when the independent exhibitor organizations grew dissatisfied with the Consent Decree of 1940, and began to make their own deal with the Big Five—to the disadvantage of the independent producers.

            Alienated by their exhibitor allies, and with the antitrust case reaching a standstill, the independent producers combined to form the Society of Independent Motion Picture Producers. Organized secretly in 1941, then publicly announced in early 1942, the group intended to do collectively what no independent producer could do as a maverick—end the Hollywood studio monopoly of the American film industry.

            Most of the SIMPP founders had years of filmmaking experience fighting for creative and economic freedom. When they joined together in their collective effort, some of the producers were at the peak of their influence in Hollywood, while others were at important crossroads in their careers.

            Charlie Chaplin, the screen’s most highly-regarded comedian, was also one of the most versatile talents in Hollywood. As writer, director, and actor, he had grown accustomed to lavishing years of painstaking effort on each of his features. As independent producer, Chaplin worked at his own pace without having to answer to any studio boss. His pioneering achievements in independent production showed other artists how to use their own companies to maintain complete creative control.

            Walt Disney, the cartoon filmmaker from the midwest, established his studio as Hollywood’s preeminent animation house with an uncompromising attitude toward independence that gave him the freedom to take the animated cartoon to artistic and commercial prominence. Disney overturned box office figures with Snow White and the Seven Dwarfs (1937), and, during Hollywood’s golden age, was one of the most venerated and decorated filmmakers in the American cinema.

            Samuel Goldwyn, the oldest producer of the group, was one of the founding fathers of Hollywood, and an instrumental figure in the early history of both Paramount and Metro-Goldwyn-Mayer. He opted out of the studio executive class, motivated in part by his “lone wolf” nature as well as his inability to deal with partners. A one-time Hollywood mogul archetype, he reinvented himself as an independent producer, forming a production company that became the model for the independents who followed.

            Hungarian cosmopolitan Alexander Korda was one of Hollywood’s promising imported directors who turned his back on the American studio system to become an empire-builder overseas. Settling in London, he intended to make his independent production company the most important studio outside the United States, before setting out again to conquer Hollywood.

            Mary Pickford was one of the screen’s most remarkable figures who embraced a mixture of acting presence, filmmaking ability, and astute business aptitude that was almost otherworldly. She used her screen idol status to become her own producer, and ultimately her own company boss, while remaining one of the most outspoken proponents of independent production.

            David O. Selznick was the son of industry pioneer Lewis J. Selznick, and the beneficiary of a childhood immersion in independent film production. Working within the major Hollywood studios, he became a supervisor, and later studio production head, before heading his own independent production company.

            Walter Wanger, a tweed-suited college graduate with a background in theater, also successfully worked his way up the studio chain of command before getting out at the top. His style and mannerisms evoked the image of consummate Hollywood film producer, and lent itself well to both his studio occupation and his independent producer mantra.

            The final founding member of SIMPP was Orson Welles, then a virtual newcomer to the film industry. The writer-director-actor attained unprecedented public attention in theater and radio. Then, at age 24 Welles produced his extraordinary film debut Citizen Kane (1941). He was a skilled producer and an influential member of SIMPP, but his revolutionary film directing has overshadowed his many important contributions to the industry.

            The formation of the Society of Independent Motion Picture Producers became a turning point in the Paramount antitrust case. SIMPP lobbied within the industry, and recruited other producers who tired of the studio restraints, including Howard Hughes, Hal Roach, Leo McCarey, Sol Lesser, James Cagney, Bing Crosby, John Huston, Preston Sturges, Sam Spiegel, and Stanley Kramer. Gradually the focus of the Paramount case shifted away from the independent exhibitors as SIMPP began to steer the events of the antitrust suit in favor of the independent producers.

            They continually petitioned the government during the trial, but concluded that the most effective way to impel change would be to take the case to the people. The SIMPP founders used their household-name status as a weapon against the studios—gobbling up headlines, attracting attention from national media, and generating public awareness of the leviathan behind the Hollywood glitter machine.

            SIMPP also waged an all-out war on the most controversial old-time studio practice known as block booking. Under block booking arrangements, a distributor would sell its films in packages on an all-or-nothing basis—usually requiring theaters to buy several mediocre pictures for every desirable one. Because the studios made mass-produced films, they also sold them in bulk.

            Block booking was wholly unacceptable to the independent producers for a number of reasons. To begin with, block booking made it difficult for the independents to acquire film bookings when theaters were required to purchase all the studio films they needed in a single package. But even worse, the independents found that their films were being used by the distributors to pawn off low-budget studio B-pictures. The producers believed that block booking encouraged slack filmmaking by forcing inferior films on the theaters and the moviegoers. The SIMPP members brought this obscure practice to the fore until the courts finally abolished block booking—which has remained illegal to this day.

            SIMPP continued to intensify its antitrust activity throughout the 1940s. The group filed an amicus curiae that enabled friend-of-the-court collaboration between the Society and the Justice Department, and turned SIMPP into one of the most active participants in the antitrust suit. The producers also hired Ellis Arnall, the trustbusting former governor of  Georgia, to serve as Society president, bringing with him his political connections and progressive antitrust agenda.

            Finally, the 1948 Supreme Court decision provided the independent producers with victory. The Big Eight were declared guilty of conspiracy. The Hollywood studios were forced to sell their theater holdings, and all film companies were prohibited from oppressive practices like block booking. The success of the Paramount case signaled the demise of the studio era. In the years prior to the decision, the major studios had softened to independent production; and once block booking and theater owning were eliminated, the studios turned to the independent producers for their films. By the mid-1950s, the majority of major distributor releases were provided by independent production companies, as SIMPP had envisioned years earlier.

            Interestingly, following the disintegration of the studio system, SIMPP itself unexpectedly declined. Though SIMPP helped make independent production the dominant form of filmmaking in Hollywood, ironically the movement grew too rapidly, and SIMPP as an organization did not expand accordingly. The Society’s influence was undeniable, and its triumph over the studio system was monumental, but the independent producers lacked cohesion. Without the antitrust fight to unify the organization, the members lapsed into their natural state as stubborn, idiosyncratic, and disagreeable partners. After the studio opposition collapsed, the independent organization eroded, going from industry headline to film history footnote. In 1958 as the last of the major studio theaters chains was completing divestiture, SIMPP operations were curtailed and absorbed by one of the most successful independents, Walt Disney Productions.

 

Research for Hollywood Renegades is based on documents that have remained unpublished in the years since the demise of SIMPP. The author has uncovered extensive SIMPP material among the collections of the founding members, particularly David O. Selznick, Mary Pickford, Walter Wanger, and Walt Disney. Original court records also helped flesh out the history of the organization from an antitrust standpoint. The trade publications and numerous publicity events of the SIMPP members have proved valuable by illustrating the influence of SIMPP in the public arena. The sheer amount of exposure the Society received within the industry and in national publications of its day has made the forgotten nature of the group even more fascinating from a historical perspective.

            While some of the works of past biographers mention the trustbusting efforts of individual producers, no previous film history has studied the collective efforts of the independents who joined together to protest the studio system. Hollywood Renegades discusses the steps that the SIMPP members took to end the studio lock on American film production.

            The existence of SIMPP allowed the producers to romanticize their position in Hollywood history, as most of them viewed their struggle with the studio system on an epic scale worthy of a scenario from one of their own films. While many of the non-antitrust activities have been outlined in this book—such as the blacklist, censorship, and the advent of television—Hollywood Renegades focuses on the monopoly war that served as the primary objective of the SIMPP organization. The history of the Society of Independent Motion Picture Producers provides a revealing look at the independent film movement and the transition of the American cinema away from the studio era.

             The story of SIMPP also demonstrates a common historical pattern (and one of the most potent ironies about independent filmmaking)—the inevitable tendency of the independent victors to replace a defeated monopoly with a new monopoly of their own. Even the major studios all once had renegade roots. The studio czars who resisted SIMPP were all former independents themselves. Adolph Zukor, William Fox, and Carl Laemmle were one-time trustbusters who battled the Motion Picture Patents monopoly organized under Thomas Edison in 1908. A generation before SIMPP, “outlaw” independent companies like Paramount, Fox, and Universal moved out west, established Hollywood, and then went on to create an even more sophisticated monopoly that discriminated against other independents.

            Hollywood Renegades traces the history of the independent movement back to the silent era in order to elaborate on the rise and fall of monopolies which characterized SIMPP. Chapter 2 provides this overview, without being overly meticulous, while chapters 3 and 4 discuss the antitrust setting that led to the formation of the Society of Independent Motion Picture Producers in chapter 5.

            This book also discusses the manner in which the studios themselves adopted the ideology of the SIMPP producers. By adjusting to the methods of the independents, the studios reemerged in conglomerate fashion. The author argues that the independent movement led by SIMPP provided the blueprint for the rise of the diverse media companies of modern Hollywood, as embodied in the corporate progeny of SIMPP founder Walt Disney. Hollywood Renegades also shows that certain trends, like the rise of the blockbuster-driven industry mentality and the application of corporate synergy, are not recent entertainment developments, but ones which were popularized years earlier by the SIMPP producers.

            While brief career profiles the SIMPP members are provided throughout the text of this book, Hollywood Renegades avoids the anecdotal filmmaking exploits of each producer in the interest of focusing on new historical information concerning the Society of Independent Motion Picture Producers. For readers who desire more specifics on the filmmakers featured in this book, the author’s supplementary research material has been collected by the publisher Cobblestone Entertainment on its website located at http://www.cobbles.com.

            The online SIMPP database is provided free of charge to promote film scholarship on the independent movement of the cinema. The website provides sources and additional information on many other aspects of this vast and fascinating topic which could hardly be accommodated in any one volume.

 

 

NOTES AND SOURCES FOR CHAPTER 1:

Hollywood studio control of 95 percent of film industry: Big Five, 73 percent; Little Three, 22 percent. Conant, Antitrust in the Motion Picture Industry, p. 44.

"There are two kinds": Berg, Goldwyn, p. 108.

"It is my opinion": David O. Selznick to John Wharton and John Hay Whitney; Behlmer, Memo From David O. Selznick, p. 100.

"I can’t afford": Kulik, Alexander Korda, p. 224.

In 1939, it is worthy to note, the four mentioned studio-made films The Wizard of Oz, Mr. Smith Goes to Washington, Union Pacific, and Dark Victory were all produced by former or future independents who, at the time, were under studio contract—respectively Mervyn Le Roy, Frank Capra, Cecil B. DeMille, and Hal B. Wallis.

Wanger quote—"an independent producer is someone dependent upon the banks, the trade press, the lay press, the radio critics, the theatre men, distributors and, lastly, upon the public": Walter Wanger, "Mr. Wanger on the Stand: The Prominent Producer Has His Say About American and Foreign Films," NYT, May 15, 1938, sec. X, p. 4.

The Big Five controlled 2,600 theaters (about 16 percent of the domestic theaters) with 126 of the 163 first-run theaters (about 77 percent on the first-run market) in the largest 25 metropolitan areas: Huettig, Economic Control of the Motion Picture Industry, pp. 6, 77.

Independent financing contingent upon a Big Eight distribution agreement: Donald M. Nelson, "The Independent Producer," The Annals of the American Academy of Political and Social Sciences, 254 (November 1947), p. 49.

U.S. Justice Department initiates the Paramount suit; "divest themselves of all interest": "Big Film Concerns Accused In U.S. Suit of Acting As Trust," NYT, July 21, 1938, p. 1.