PONDERS TAFT-HARTLEY WAL

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JACKSON PARK DECREE UPHELD I
BY CIRCUIT COURT OF APPEAL
Drastic Changes May Come
In Whole Chicago Setup
Of Selling, Playing
CHICAGO—The sweeping decree in the
Jackson Park Theatre antitmst case, which
threatens to upset the entire distribution
and clearance system in Chicago, was upheld
In virtually every essential by the
circuit court of appeals in a decision
handed down early in the week.
Among tlie
most revolutionary aspects of
the decree, as it concerns the majors, is
it.s limitations on the length of first runs
in Loop theatres. The decree specifically
forbids the defendants from keeping their
pictures for more than a two-week run in
their own theatres, or for more than one
week in a later run.
FORCES QUICK RUNOFF
Should a Loop theatre hold over a picture
for a longer period, the film must then be
released to other theatres.
Other provisions of the decree are:
*1) It eliminates the establishment of
"dead or waiting time" between first
runs and the next run by theatres operated
by the defendants. This will eliminate
waiting time between Loop and
neighborhood showings.
12 1 It prohibits the practice of "conditioning
of film licenses upon the maintenance
of minimum admission prices,"
in other words, the practice of setting the
price before a picture is released to a
theatre.
i3) Use of double features, "when used
to further the conspiracy," are illegal.
In other words, the defendants can properly
be enjoined by' injunction from using
double features where they are used
for the purpose of preventing the Jackson
Park Theatre from obtaining pictures
before the defendants have channeled
them "through the conspiratorial
system."
What the court did hold, however, was
that the decree could not be used to give the
Jack.son Park Theatre "a favored fixed position
in the scheme which they (the plaintiffs)
have .sought to destroy."
DENIES SINGLE PROVISION
The decree had enjoined the majors and
other defendants from preventing the Jackson
Park Theatre "from buying a run of
pictures one week in advance of the Maryland
Tlicatre la B&K house i at a rental not
to exceed a fair and reasonable film rental."
This, the court held, "you cannot do by
injunction." The decree, it held, may be
used "to destroy the conspiracy root," but it
cannot be used to redress the economic balance
between the plaintiffs and the defendants.
"No one has a vested right In playing
time," the court declared.
Thomas McConnell, attorney for the Jack-
.son Park Interests, had contended that the
Maryland Tlicntre was given preferential
treatment In films. This general preml.se
was the basis on which the original suit was
brought and on which damages of $360,000
Text of the Court's Decision
Following is the complete text of the decision handed doicn by the Unitei i
States Circuit Court of Appeals in the Jackson Park case. The opinion was writ-
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ten by Judge Sherman Minton, with Justice Will M. Sparks and J. Earl Major
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concurring.
This is the second appeal in this cause.
On the first appeal, 150 F. 2d 877. we found
that the conspiracy alleged in the complaint
was established by the evidence and was sufficient
to support the jury's verdict, but we
reversed on the question of damages. On
certiorari to the supreme court, that court
affirmed the finding of a conspiracy buc
reversed us on the question of damages, holding
that the plaintiffs had sufficiently and
correctly proved the measure of damages, and
affirmed a judgment for $360,000 damages,
327 U.S. 251. 66 S. Ct. 574, 90 L. Ed. 579. The
facts are set forth in these two opinions.
After the supreme court had reversed this
court and the cause had been remanded to
the trial court, the plaintiffs filed a supplemental
complaint alleging continuation of
the conspiracy. In it they prayed for equitable
relief and also additional damages for
the period subsequent to the filing of the
original complaint. The claim for additional
damages is still pending in the district court.
The plaintiffs' .supplemental complaint alleged
that the defendants were estopped by
the verdict in the first damage trial from
contesting any of the allegations of the original
complaint or any of the allegations advanced
by the plaintiff during the trial of
said issues. The defendants answered denying
estoppel, and the estoppel issue joined
was set separately for trial.
Full Record in
Evidence
At the hearing the plaintiffs put in evidence,
for the limited purpose of showing
what had transpired during the trial and
appeal of the damage issue, the complete
printed record and the brief filed, and also
the opinions handed down in this court and
in the supreme court. This was the only
evidence then heard by the trial judge sitting
as a chancellor and it was expres.sly understood
that the printed record, although it
contained the testimony heard by the jury
generally, was received only to permit the
trial judge to determine to what extent inquiry
by him into the merits was precluded
by estoppel. The trial judge held with the
plaintiffs that every allegation of the plaintiffs'
original complaint had been decided
finally and conclusively in the plaintiffs"
favor by the jury's verdict. In addition, the
trial judge made a number of additional findings
of fact which set forth the plaintiffs'
operated by the dcfcndanl.s, and finally in
were awarded. The U.S. supreme court upheld
this verdict last year.
McConnell then went before Judge Michael
L. Igoe and asked for a decree carrying
out the provisions of previous findings. This
Judge Igoe did in his now revolutionary injunction.
As the original suit asked for damages
only for the period prior to 1940, a supplemental
suit for the period from 1940 to
1946—asking $600,000 damages— Is now pend-
conception of what they had proved tt It
trial. The district court thereupon
a permanent injunction as prayed for bf fiJ
plaintiffs. From this judgment, the de"
ants have appealed.
By this appeal the defendants challeri
the trial court's ruling that estoppel by «.
diet extends to every issue involved In pf
litigation between the parties. They cont«
that as a matter of law estoppel by vtti,
extends only to matters expressly and neo
sarily decided in the prior litigation, w.
the result, as contended by the defendu
that the court's decree in its present fM;,
must fall. The defendants request this cm
to modify the findings by confining sg
findings to the issues upon which the ('
fendants actually are estopped, and to en
a decree on the findings as so modified.
A Resume of the Case
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The original complaint stated but O'
cause of action which, if proved, entitled t
plaintiffs to two kinds of relief, name
damages and an injunction. The same Jud
that presided in the trial of the dama
action heard the plaintiffs' application for
injunction. One phase of this complain
was submitted to the jury which returned i
verdict for damages, upon which judgme
was entered and finally affirmed by the su
preme court. The other phase was tried
the presiding judge as a chancellor, w
has stated his findings of fact and cond
sions of law and upon them entered the d
cree from which the defendants have a
pealed.
The defendants were found guilty of o
conspiracy in restraint of trade in \1olati.
of the Sherman act, 15 U.S. C. A. Sec. I.
jury so found, and the district court, tl
The
t.
court, and the supreme court upheld
finding of conspiracy. The conspiracy
operated that the defendants might hold
picture in the Loop for the benefit of th<
theatres there, at minimum admission prir
to be charged, for such playing time as :1
defendants might agree upon. When tl
picture was through playing in the Loc
there was a clearance time of three wee
before it could play elsewhere in Chlcaa
The picture was then channeled in a sen
of release weeks through theatres owned ar
(Continued on next page)
ing.
This week's decision of the circuit court is
creating considerable excitement among exhibitors,
both within the defendant group •!(
independents. Drastic changes will come k
the whole scheme of selling and playlDf W
pictures in the Chicago area if the provllioii
of the decree in their entirety are carrw
out. It is expected that the defendants wl'
ask the U.S. supreme court for a review 'i
the appeal.
Defendants In the case are Paramount P*
tures. Inc.: Balaban & Katz Corp.: Wsrnii
Bros. Circuit Management Corp.; 'Vltagnp'
Inc.: 20th Century-Fox Film Corp.: Loer;
RKO Radio Pictures and Warner BW
Inc.:
Theatre Corp.
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BOXOFTICE
;: June 28, l*