(1951) Tags: RKO
King Bros. Productions, Inc. v. RKO Teleradio Pictures, Inc.
Plaintiff King Bros. Productions, Inc. (King Bros.), an independent motion picture producer, sues to recover damages in excess of $12,000,000 allegedly arising out of the discontinuance of the world wide motion picture distribution business conducted by defendant RKO Teleradio Pictures, Inc.
The complaint pleads six separate claims. The first three of these are against RKO only and are for alleged breach of contracts providing for the production by King Bros. and the distribution by RKO of three motion pictures, respectively “Drums In The Deep South”, “Carnival Story,” and “The Brave One”.
Beginning in mid-November 1956 it was rumored in the motion picture industry and in the press that RKO intended to disband its distribution organization. Plaintiff protested on the ground that the rumored action would constitute breach of RKO’s contracts with it. It allegedly received assurances, however, from RKO, General Tire and the individual defendants that in fact no such steps were anticipated.
Nevertheless, on January 21, 1957, RKO licensed defendant Universal to distribute the films then in RKO’ hands, including the three King Bros. pictures, in the United States, Alaska, Guam, and to the United States Armed Forces overseas.
On February 1, 1957, Empire Universal Films Limited was licensed to distribute these films in Canada, its maritime provinces and Newfoundland. Finally, on June 25, 1958, J. Arthur Rank Overseas Film Distributors Limited was licensed to distribute the films involved abroad. RKO then disbanded its distribution organization and ceased to engage in the business of distributing films.
King Bros. contends that this course of conduct by RKO breached its contracts for the distribution of its films and that it was damaged thereby because the licensees Universal, Empire and Rank were not capable of handling the distribution of the three pictures involved here as profitably as RKO could have done. Accordingly, King Bros. seeks damages from RKO in the amount of $2,000,000 on its claim for breach of “The Brave One” contract, $200,000 on its claim for breach of the “Carnival Story” contract, and $10,000 on its claim for breach of the “Drums In The Deep South” contract.