Columbia Strikes Back

Columbia Strikes Back

The Close Encounters story continues (and another brief hiatus for #1939TheMiracleYear)

When “Close Encounters of the 3rd Kind” was set by bid for Tom Moyer’s Westgate theater in Beaverton it was months before it was to open in December of 1977. They offered their largest theater in that complex, and there should have been no problem with opening the film in the normal course of business.

But that exact same house was the exclusive venue for a film that opened in Portland in May – Star Wars (aka Star Wars IV – A New Hope). Most films exhaust the available audience within a month or six weeks. Not so with this juggernaut. Yet there would not have been any problem if Star Wars could have been moved into a smaller house at the same complex. The contract, however, that Tom Moyer Theaters had with Fox for this film precluded such an arrangement. It possessed a provision that almost never kicks in – a ”hold over” clause. According to this provision, if the three day (Fri-Sat-Sun) gross exceeded a set amount, then it automatically held over for another week. When it became apparent that Star Wars was not losing steam, but actually picking up force six months after its opening, they contacted Columbia (the distributor of CE3K) to ask to move the opening of their film onto another (smaller) screen in the same complex.

That was not acceptable to Columbia – either CE3K went into the contracted theater on schedule or they would sue TMT for breach of contract. In any event TMT was going to be sued for breach of contract, for Fox would insist on suing if Star Wars was taken off while still doing holdover business.

Columbia took CE3K away from TMT and gave it to their competitor Larry Moyer (Tom’s estranged brother) and brought a breach of contract suit against TMT. When Tom brought a restraining order against Columbia, the distributor went another step further, by removing TMT from the bid list in Portland, effectively giving all of their upcoming films to Larry. This led Tom to claim that Columbia’s actions were in essence a group boycott and hence a breach of antitrust law.

The District Court ruling went against Columbia on their breach of contract claim, but against Tom on his antitrust claims. As these things go, appeals dragged the suits on well after the life of the films in the theaters. In fact, Star Wars V – The Empire Strikes Back came out in Tom’s theaters before the decision from the appellate court came down.

When it did come, the 9th District Appellate Court upheld the District Court’s judgement against TMT’s antitrust claims.

Per the Entertainment Law Reporter 4:19:5
“Columbia had sound justification for its refusal to deal with Tom Moyer on the basis of the ‘Close Encounters’ episode. In Columbia’s view, Larry Moyer had the next best available facilities in the area. And, even assuming that there was some type of ‘conspiracy’ between Columbia and Larry Moyer, there was no showing of any anticompetitive purpose or effect.”
(Evidently the records I dug up for the lawyers to analyse were the basis for the following section of the report):
“Tom Moyer was the only party likely to suffer from any conspiracy, and his system-wide grosses and profits had increased each year; the profits from the Portland market declined only four per cent from July 1979 to February 1980.”

I would like to close this out with a comment as to what happened afterwards, but I don’t recall how long Columbia locked TMT out of their product.  (A project for another day, when I can access some newspapers from the time period to check the ads).  I can’t help but think that Columbia got the worst of the bargain.

Moving on Up to Booking Films

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The Seeley Theater in Pomeroy, WA

After I left the UA Cinemas 150 and 70, I applied for other “film biz” jobs in the Seattle area. One of the first places I applied was the Saffle Theater Service, a film buying and booking firm that covered the Northwest. I did not hear anything from them then, but soon after an assistant manager position opened up with Mann Theaters at their Fifth Avenue Theater, so I forgot about that application. However, the owner, Bud Saffle, must have remembered me, for a less than a year later something had changed and he contacted me with an offer for a position as his booker.

When I was hired on at the Saffle Theater Service, it was a big promotion in more ways than one. The salary was better to be sure. But so were the hours. They were regular “bankers’ hours.” A nine to five job. No more late, late nights. And there were other perks as well, but more on that later.

It was in a part of Seattle that was “new” to me, (possibly explained by the fact that it was in the opposite direction from the Fifth Avenue theater, and hence off my normal path). From our apartment on Fifth Avenue, I just had to head over to Westlake – a boulevard that cut diagonally across the regular grid. On the other side of Denny Way I took a right on John Street, and another right on Terry Avenue and looked for a spot to park.

I always took the Roadrunner and parked on the side of the small two story office building on the corner of John and Terry. The Saffle Theater Service was on the second floor on the Terry Avenue side. You entered through glass doors into a large open area, presided over by the company secretary and the company records. Mr Saffle had the office on the right; mine was beside his on the left (from its window, I could keep tabs on my Roadrunner).

Mr Saffle’s company represented about thirty independent exhibitors, i.e. theater owners, spread throughout the states of Washington, Oregon, and Idaho. They were small town cinemas dating back to the thirties or before; or drive-ins from the fifties. Mr Saffle personally handled the larger accounts, the Mike Mercy Theaters of Yakima and the Kenworthy theaters of Moscow/Pullman. I had the smaller theaters around the hinterlands, like the Seeley in Pomeroy, WA. (It was only open a few months, being closed to store potatoes the bulk of the year). Of particular interest to me, was the Alpine Theater in Colville, WA. It was my Mom’s home town, and I was familiar with this theater, having lived in Colville when a boy.

Mornings were taken up with collecting grosses from our theaters and disseminating them to the pertinent distributors. You can be sure the distribs wanted to know, especially on Mondays after the weekend. They would press us to hold their films over (or try to get us to take off a competitor’s to bring their new title in – exhibitors and distributors have a notorious love-hate relationship). Monday mornings could be a real trial, especially for my boss, for he made all the big decisions – regarding hold overs and terms.

I had to learn new aspects of the “film biz.” Contracts, terms, booking dates and cutoff cards. Much of it was phone work, calling my counterparts with the distributors for film availabilities and terms, and advising my clients about what would perform well in their locations. Mr Saffle tutored me in the whole system that was in place governing the split of the box office monies, which is an interesting topic. Some films were flat $100 or $125, but those were always older films, usually booked as a lower half to a double bill. The newer films were paid on a percentage basis.

The stated percentage is what the exhibitor paid the distributor. So, for instance if the terms were 35%, that meant my client kept 65%. And that’s the way we liked it. Subsequent weeks bottomed out at 25%, and we liked that even better. Bigger films had bigger terms and required playtime commitments. For our bigger towns the minimum was four weeks. The first week was 70%, the second 60%, the third 50%, and the fourth 40%. If business held up the film could be held beyond that for 35%.

But there could be another wrinkle to the big term pictures – the dreaded 90/10. Each theater had an agreed upon house expense, the cost the exhibitor incurred just to open the doors for a week. (One which our firm always tried to negotiate up as high as possible). You would subtract that “nut” from your gross for the week, and of the balance you only kept 10%.  But hold on. There was an “if” involved. The distributor always took whichever was greater, the result of the 90/10 calculation, or the floor percentage for that week.

[Aside – I had heard one time that the whole 90/10 business had its origin back in the late thirties. An exhibitor came up with the formula in a bid that he put forth in an attempt to win the rights to show “Gone with the Wind” over his competitor. Then the floor was 25%]

When you ended up paying the floor percentage, you theoretically might not be covering your costs in that week. (And you always wondered why concessions cost so much. Many exhibitors would claim they weren’t in the film business, but in the popcorn business. They probably still do).

Then at multiple times during the week we had screenings to go to, (and the main reason I drove to work rather than walked). The distributors arranged these for film buyers in the exchange area to see their new product in advance of their release.

It was a much anticipated perk.

But more on that next time – so stay tuned and Watch This Space.