The Famous Players-Lasky Antitrust Case
Further Complaints Against Paramount—Movie Exhibitors
Testimony of Joseph C. Boss
New York Telegraph - May 11, 1923:
Joseph C. Boss, of Washington, D.C., who began his career as motion picture
exhibitor in Philadelphia in 1904, was on the witness stand all day
yesterday...Briefly, Mr. Boss's story is that S. A. Lynch, who was head of a
district agency for Paramount Pictures, told him on the street in Dallas, Tex.,
that if he, Boss, put in a picture house at McAlester and took all Paramount
pictures the company would not put in an opposition house. Acting on that verbal
promise, he put in the house. That was in the latter part of 1919. In October of
1920, Mr. Boss testified, the Paramount people established a house across the
street from him and about this time he began having trouble about the delivery
of his lobby displays and could not get certain films...
Testimony of J. S. Burnham
New York Telegraph - May 17, 1923:
J. S. Burnham, who has operated motion picture theatres at Cortlandt, Auburn
and Seneca Falls, N.Y. was placed on the stand yesterday before Commissioner E.
C. Alvord of the Federal Trade Commission, inquiring into the operations of
Famous Players Corporation to determine whether they act in restraint of
trade...
Mr. Burnham said that a Mr. Rose, representing the Famous Players
distributing office in Buffalo, called on him several times at Cortlandt, N.Y.,
where he had at that time two theatres. Mr. Rose wanted to sell him pictures. He
wouldn't buy because he said the prices were too high and he would have to
change admission prices if he bought them. After numerous calls by Rose another
representative from the Buffalo office came back with Rose and the conference
was heated. Mr. Burnham testified that they threatened him. This was ruled out
as a conclusion of the witness. He was asked to repeat what was said. He
couldn't recall what was said beyond repeating several times that the conference
was very heated and that he, in effect, told them to move on.
Shortly after that a series of four advertisements appeared in the Cortlandt
Standard, a newspaper, asking the people of Cortlandt to demand of their theatre
managers an opportunity to see Paramount Pictures. The advertisements declared
that Cortlandt was about the only city in the State which was denied the
privilege of seeing Paramount productions. As a result of these advertisements,
Mr. Burnham testified, several of his patrons stopped him on the street and
asked him why he did not run Paramount Pictures.
He told them that he could not afford to do so because they cost too much. On
cross-examination he added that he told them the theatre was his and he would
run in it the pictures he chose. Two postal cards mailed from Buffalo were also
introduced in evidence. These cards asked him why he did not run Paramount
Pictures. After the postal card and advertising campaign on behalf of Paramount
another theatre, the Novelty, with a seating capacity of 225, changed its name
to the Paramount-Novelty and began running Paramount Pictures. . . .
Testimony of Benjamin Knobel
New York Telegraph - May 22, 1923:
Benjamin Knobel . . . is one of the principal stockholders in companies which
operate motion picture theatres in the Bronx and farther up . . . . Mr. Knobel
said he bought all the Paramount productions because he had been told that their
plan of selling was all or none. . . . Asked to be very definite, he said he was
told this in the New York Famous Players office about August 18, 1922.
The witness complained that some of the pictures for which he had contracted
were not released to him but that they appeared on Broadway and was unable to
get them . . . .
The question of adjustments on prices paid for pictures which did not draw a
paying business was discussed at length. The witness said he invited the
Paramount distributing office manager in New York to examine his books and
discovered that the Paramount office had already had a man at his theatre
entrance "clocking" the crowd--that is, counting the people as they
entered.
He objected to this means of checking business on the ground that a
motion-picture theatre has a great many passes. He estimated the number at an
average of 150 a day, but said that these passes do not come in an average
way--that on some days they amount to 300. Nearly all of these passes are issued
in payment for the privilege of posting window cards...
Charles A. Goldreyer, who is a partner with Mr. Knobel in four motion picture
theatres and has another of his own, was the next witness. On direct examination
he was asked if he bought the complete Paramount output because he had to in
order to get any. He said he bought all of Paramount's output because he wanted
all of it. He said several pictures for which he had contracts with Paramount
were taken away from him and given to a competing theatre. He objected but got
no answer . . . .
He went over much the same ground as Mr. Knobel on the subject of
"clocking" the crowd as a means of checking the business a theatre was
doing. On the subject of number of passes, he said the Kinsbridge Theatre issued
500 passes a week, each for two persons, and that these are honored only on
Mondays, Tuesday, Wednesdays and Thursdays...
"You have had continuous relations with Paramount since 1912, and have
had friction over only the few pictures indicated in your testimony?" asked
Mr. McDonald.
"Yes."
"On the picture 'Peter Ibbetson,' for which you paid $2,000 and lost
money, you received an adjustment of $500, did you not?"
"Yes."
"There is nothing in the contract calling for that adjustment or any
adjustment is there?"
"No."
"On the whole don't you think Paramount has dealt fairly well with
you?"
"In some ways they are fair and in some ways not. If they had given back
the whole $2,000 for 'Peter Ibbetson' it would still have been a loss."
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