contained in Paragraphs 76, 77, 78, and 80 which refer either
expressly or impliedly to United Artists are sustained; and the
objection to that part of the finding contained in Paragraph 87
which construes the decision in United States v. Paramount
Pictures is sustained. The findings contained in Paragraphs 92,
93, 94, and 95 are irrelevant to any of the issues in this suit
since they relate entirely to matters occurring long after the
execution of the agreements in escrow, and accordingly the
objections thereto are likewise sustained.
For the reasons heretofore stated, the objections to the
Conclusions of Law contained in Paragraphs 100 through 116 are
The objections to all other findings submitted by the Master in
Paragraphs 59 through 99 of his report are overruled, and said
findings are accepted by the court as part of the Findings of
Fact entered herein.
Additional Findings of Fact.
On the basis of the record certified by the Master, the court
now enters the following additional Findings of Fact:
1. Prior to June 11, 1946, the individual cross-claimants owned
all of the capital stock of the Miller Theatre Corporation, which
was the lessee of the Miller Theatre in Milwaukee. The location
of the Miller Theatre was suitable for the exhibition of
first-run motion pictures, but the theatre was then in a state of
disrepair and could not be used profitably for that purpose. The
individual cross-claimants therefore displayed second-run motion
pictures at the Miller from May 2, 1946 until August 15, 1946,
when the theatre was closed for remodeling.
2. In April 1946, United Artists controlled at least eleven
motion pictures which it could not license for display at
first-run theatres in Milwaukee. United Artists wished to acquire
a theatre at which it might display its backlog of first-run
pictures, and it therefore sought to purchase at least half of
the capital stock of the Miller Theatre Corporation from the
individual cross-claimants. The individual cross-claimants were
unwilling to sell half of their stock, but were willing to sell a
lesser amount in exchange for an agreement to supply United
Artists' pictures and substantial financial support.
3. Representatives of United Artists and the individual
cross-claimants inspected the Miller Theatre, and agreed that the
theatre was not then suitable for first-run display of United
Artists' films. They therefore agreed upon an extensive
remodeling program, to be financed as provided in the agreements
later placed in escrow.
4. The Miller Theatre was re-named the Towne, was remodeled at
a cost of about $190,000, and was reopened on December 26, 1946.
After remodeling, the theatre was in all respects suitable for
the first-run display of motion pictures.
5. The recapitalization of the Miller Theatre Corporation and
the remodeling of the Miller Theatre was effected by the three
agreements later placed in escrow. These three agreements were
executed willingly and deliberately by each of the signatories.
6. Two-hundred shares of Class B stock of the Towne Theatre
Corporation were subscribed for and purchased by United Artists
pursuant to one of the three agreements in escrow. Certificates
for said 200 shares were delivered to United Artists by the
Theatre Corporation, and were in the possession of United Artists
until the commencement of the hearings before the Master.
7. United Artists did not conspire to monopolize the exhibition
or distribution of motion pictures in the Milwaukee area as
alleged in the cross-claim.
Conclusions of Law.
1. Under the terms of the escrow agreements dated September 17,
1946, the escrowee was obligated to deliver the three agreements
in escrow to United Artists on June 11, 1948.
2. The three agreements in escrow do not violate the provisions
of any statute
of the United States, and are not unlawful under the provisions
of any decree entered by any court of the United States.
3. The cross-claimants have failed to prove by a preponderance
of the evidence that they are entitled to rescission of the
escrow agreement or any of the three agreements placed in escrow.
Accordingly, it is hereby ordered, adjudged and decreed that
each of the three agreements placed in escrow with Lazarus
Krinsley on September 17, 1946, be delivered to United Artists
Corporation upon demand, without mutilation or alteration, by the
party or parties now in possession of said agreements.
It is further ordered, adjudged, and decreed that judgment on
the cross-claim be, and is hereby entered in favor of United
Artists Corporation, and the cross-claim is dismissed at
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