William O. Douglas

“ While such an inquiry is the starting point for determining to what extent divestiture should be ordered, the matter does not end there. For it may be that even after appellants are deprived of the fruits of their conspiracy, the Schine circuit might still constitute a monopoly power of the kind which the Act condemns (see American Tobacco Co. v. United States, 328 U.S. 781, 809, 811, 66 S.Ct. 1125, 1138, 1139, 90 L.Ed. 1575) , in spite of the restrictive provisions of the decree. Monopoly power is not condemned by the Act only when it was unlawfully obtained. ”

“ Defense of the long-term filmrental agreements-the franchises-is made on the ground that they were accepted methods of doing business in the industry, [8] that they were favored by distributors as devices to stabilize their end of the business and to save expense, and that they were not chosen by Schine as instruments to suppress competition. But it seems to us apparent that their use served to intensify the impact of Schine's monopoly power on its competitors. ”

“ This large buying power [5] gave Schine the 'opportunity to exert pressure on the distributors to obtain preferences.' Moreover, Schine by combining its closed and open towns in its negotiations for films was able 'to dictate terms to the distributors.' Schine bought films for some theatres in which it had no financial interest (but as respects most of which it had an option to purchase) . ”

“ The other aspects of the findings we do not stop to analyze. For the franchise agreements § employed by Schine are unreasonable restraints of trade for the reasons stated; and they must be permanently enjoined, even though we assume their collateral aspects are not accurately described by the District Court and so may not be condemned.
(3) Appellants challenge the finding that Schine made threats to build theatres or to open closed ones in order to force sales of theatres in various towns or to prevent entry by an independent operator. ”

“ Appellee seems to argue that standards of reasonableness can be dispensed with by reason of statements in the inter-office memoranda of the distributors that many of Schine's clearances were 'unreasonable.' On the matter of clearances, however, the interests of distributors and exhibitors are not necessarily identical. For the self-interest of exhibitors which would call for long clearances would militate against the best interests of distributors. ”

“ There is evidence to support the findings that minimum prices were fixed. It is well settled that the fixing of minimum prices like other types of price fixing, is unlawful per se. United States v. Socony-Vacuum Oil Co., 310 U.S. 150, 60 S.Ct. 811, 84 L.Ed. 1129. The findings that Schine was either granted minimum admission prices more favorable than those required of its competitors, or that Schine, unlike its competitors, was relieved of all requirements for minimum prices, are also supported by evidence. It is said that these provisions of the agreements were not adhered to. ”

“ We need not determine whether the provision in question if read, as it must be, in light of the other paragraphs of the decree (Swift & Co. v. United States, 276 U.S. 311, 328, 48 S.Ct. 311, 315, 72 L.Ed. 587) would pass muster. For we think the public interest requires that a more specific decree be entered on this phase of the case. The precise practices found to have violated the act should be specifically enjoined.
We have considered the objections to the other parts of the injunction (apart from provisions as to divestiture which we discuss later) and find them without merit. ”

“ Clearance is an agreement by distributor not to exhibit a filn nor to license others to do so within a given area and for a stated period after the last date of the showing of the film by the licensee with whom the agreement is made. ”

“ It also performed the service (under so-called pooling agreements) for groups of theatres in which it and others were interested. Through the use of such buying power Schine arbitrarily deprived competitors of first and second-run pictures, was able in many towns to secure unreasonable clearances [6] year after year of from 90 to 180 days. obtained long-term agreements for rental of film (franchises) which gave it preferences not given independent operators, [7] and received more advantageous concessions from the distributors respecting admission prices than competitors were able to get. ”

“ The statutory requirement is that these injunctions 'shall be specific in terms, and shall describe in reasonable detail, and not by reference to the bill of complaint or other document, the act or acts sought to be restrained.' 38 Stat. ”