I want to say that the motion-picture theater owners constitute one division of the motion-picture business. There are three divisions of the motion-picture business, namely, the producer, the distributer, and the owner. Ninety-five per cent of the motion-picture owners of America are either conducting theaters in the neighborhood of large cities or conducting theaters in small cities. I represent those at this meeting. Aside from the amendment which I have suggested there Mr. REID of Illinois (interposing). That amendment merely leaves out the word "except," does it not? Mr. COHEN. This amendment was drawn by this gentleman here [Mr. Bolling], and I am advised by Mr. Bolling that that provision is in Congressman Johnson's bill. I would also suggest that a suitable amendment be made to this bill which would prevent pooling of copyrights or performing rights, as is the practice in this combination exerting an influence of prejudice through the interests of the American people, not only in the matter before but in the danger of establishing that principle in law which will permit pooling of every description to extend to other commodities. It is through the pooling of performances and copyrights that this society is making use of the copyright law as a legal blackjack. I personally have been served with 22 summonses in alleged infringements of this copyright law. I am defending those actions. They have not as yet been adjudicated. In different parts of the country the same condition is going on. A very able attorney, Mr. Nathan Burkan, is here. He lives in the city of New York, and he devised this scheme of this organization some years ago, comprised of authors, publishers, and composers. He is the general counsel. They franchise or zone the entire United States, giving to the attorney a zone of territory, the exclusive right of collection of these license fees, giving the attorney a contingent participating interest on what they could collect from everyone using music, whether hotels, dance halls, music houses, entertainment houses, ships, or anything else. Mr. LANHAM. May I ask whether or not the testimony that has been given about the 10 cents a seat annually is correct? Mr. COHEN. In Oregon they made complaints at 10 cents and they adjudicated it at 16 cents. But under the copyright law there is nothing to prevent another attorney, or 50 other attorneys, organizing the same sort of society and resorting to the same sort of methods of collecting this money. Mr. LANHAM. Does this association, to which I understand about 10 per cent of the composers and authors belong, put out through motion-picture theaters only the music of the 10 per cent or does it also use additional music of the 90 per cent? Mr. COHEN. That 10 per cent that belongs to the organization controls almost 97 per cent of the popular music that is needed in these places. Mr. REID of Illinois. How? Mr. COHEN. Because the members of that society are the men that are writing that music and they exploit it and popularize it. Mr. LANHAM. Then they do put out music through the organization composed by people who do not belong to the organization and who do not share in the proceeds of the license fees? Mr. COHEN. They share in the proceeds of license fees and royalties from sheet music and royalties on mechanical rolls or records from those who do not belong to the society. Mr. LANHAM. Then there are a great many composers who put out music who do not belong to this association? Mr. COHEN. No. This association, as they tell me, is formed for the purpose of collecting license fees of the members of the society. In that regard I want to say that we have a member of the organization named Irving Berlin (Inc.), who sent to me this [indicating], a piece of music being inclosed, and asking me to please play it, popularize it, telling me what a fine piece it was. I did this, as I have done other music. I was sued for that. Not on this particular piece from my records, but on a case that had been sent to me by a member of the society. I offer this for the record. I will read into the record a letter from Mr. A. B. McConlogue, of Des Moines, Iowa, addressed to Robert Sterritt, Guttenberg, Iowa, and which is as follows: AMERICAN SOCIETY OF COMPOSERS, AUTHORS, AND PUBLISHERS, Des Moines, Iowa, June 22, 1921. ROBT. STERRITT, Guttenberg, Iowa. DEAR SIR: On June 2 we forwarded you contracts executed in triplicate for you to sign and return to us together with your check for the license fee. To date we have not received either the signed contracts or your check. We must insist on your giving this your prompt attention and forwarding your check and the contracts at once. Failure on your part to do this will cause us to take action which will entail considerable additional expense to yourself. Very truly yours, R. B. MCCONLOGUE. Now, gentlemen, this is a very practical situation. These men are organized into a society. They pool their performing rights. They are represented by able attorneys in New York or all over the country. They write to a little theater owner in some distant part of the country a letter of this kind threatening him with a lawsuit and serve a summons on him; and, as a practical situation, when a man gets a summons and takes it up with an attorney and is told that it is going to cost him $100 or $200 he is fighting this big Music Trust, and in most cases instead of fighting it and putting up the fight they have to pay. Mr. LANHAM. Would it disturb you for me to ask you a question, Mr. Cohen? Mr. COHEN. No, sir. Mr. LANHAM. I did not want to interrupt you in the course of your remarks here. I want to find out now about music that is used in moving-picture shows. Many moving-picture shows, of course, have orchestras. Mr. COHEN. Yes, sir. Mr. LANHAM. With reference to the orchestra music, you do not get that free, do you? Mr. COHEN. We buy it. Mr. COHEN. From the music dealer, or direct from the music publisher, and pay the price they ask for it. Mr. LANHAM. Some of the smaller houses in the hamlets and towns of the country use an automatic piano and have rolls? Mr. COHEN. Yes, sir. Mr. LANHAM. Do they pay for the right to use those rolls? Mr. LANHAM. Are those rolls put out by this association? Mr. COHEN. This association does not put out rolls, but members of this association get a royalty for each mechanical roll put out, or each mechanical instrument put out by the control of the organization. Mr. LANHAM. Do you pay for this mechanical music? Mr. COHEN. We buy that and pay for it from the publisher or their representatives. Mr. LANHAM. In addition to that, in addition to these mechanical rolls for automatic players, and music for orchestras, what music is used in picture houses in America? Mr. COHEN. Pianos or a little organ. Mr. LANHAM. How do they get the music? Mr. COHEN. Some buy it and some improvise it, and even though they improvise it, or create it, or initiate it, they are served, in a large number of cases, with a summons also. Mr. LANHAM. Suppose a picture show in a small town uses a piano. The person who plays that piano goes to the music store and buys sheet music. Under the present law is there any penalty for the playing of that music by the performer without paying a royalty on it? Mr. COHEN. The American Society-it is their contention that under the present law the player of that music must also pay a license fee for the playing of that music. We find, Congressman, in the conducting of our theaters, when we have a picture that is meritorious and worth while, we get a response from our public and patrons regardless of the music, and when we do not have a worth-while and meritorious picture we do not get business in our theater. A theater owner in West Virginia inserted in his program that the music in his theater was furnished free, that no charge was made to his patrons for same, that his admission charge was only for the film as shown. He also has a questionnaire in his program asking them to say whether they are paying for the music or to see the picture and he has received a large number of answers saying that they were paying to see the picture only. I know in my own little theater whenever I have good pictures I do good business. When I do not, I suffer. Mr. BLOOM. Is he an owner? How big a percentage does he pay? Mr. COHEN. I do not know. Mr. LANHAM. Do you know what percentage of motion-picture owners in cities where they have orchestras, or some mechanical means of playing, use the productions of this association and pay the price therefor? Mr. COHEN. The American Society of Authors and Composers tell us that 70 or 80 per cent of the theaters of America are paying this license fee. Of course, I can not say of my own knowledge as to that. They have the records. In so far as the use of the copy right law for the purposes as explained here, I will present for the record a letter from Mrs. M. F. Frank, a lady who runs a little theater in Massillon, Ohio, a widow, who was served by a notice from the American Society of Authors and Composers through attorneys by the name of Frankle & Frankle, of Cleveland, who told her she had infringed the copyright law and served her with a summons, and this little woman, not being conversant with legal affairs, not having much experience with these things, let the term for answering the summons served almost run out, and got in touch with these attorneys in Cleveland, the representatives of this society, and tried to adjust the situation, and received a wire from these people advising her that it was necessary for her to telegraph them the money that day or otherwise the suit would be continued, and this little theater owner fearing that that would mean the virtual confiscation of her property borrowed the money and telegraphed it to the attorneys, and part of that money was for penalties and liquidated damages that these attorneys penalized this lady for playing the music. I am The letter from this lady tells the situation somewhat. offering that for the record so that too much time of the members of this committee may not be consumed in reading those things. That letter is as follows: Mr. SYDNEY COHEN, New York. GRAND THEATER, Massillon, Ohio, October 6, 1923. DEAR SIR: Letters received. The plain facts in the case are that from start to finish the letters and contracts from Frankle & Frankle have been full of errors, so I sent all communications to Mr. Bullock. Yet he stated that investigation had secured him this information, and even in your letter he maintains the count of seats, based on his investigation (referring to Frankle). He has my money and fine included, $145. My contract was made out to Tiffin, Ohio-the city. The number of seats, 600. We have but 444, and paid for 450 seats. They had fined me for using the music, and dated contract April, 1923. Want it dated September 17-time they received my money for both fine and dues, $145-September. In your communication he refers to Garden Theater," Massillon. In another instance he makes time limit in May. (Mr. B. has this letter.) At no time has he made correct statements; and, feeling the unjustness of the fine, I turned all over to Mr. Bullock for investigation. All I ask is that I have a contract made out to the Grand Theater, Massil lon, Ohio, with 444 seats, dated the date they received my money. Our business was a previous corporation. My husband (an invalid) and I hold 96 shares; the 3 other is a matter of form to hold under corporation. I have no money to throw away. Sincerely, Mrs. M. F. FRANK, Manager. At this time I want to thank the committee for the consideration and kindness they are showing in meeting with us here to-night, and I want you to know we appreciate it. I have another letter here from Mr. R. B. McConlogue, of Des Moines, Iowa, attorney for the American Society of Authors, Composers, and Publishers, in which he says: To date we have not received either the signed contracts or your check. We must insist on your giving this your prompt attention and forwarding your check and the contracts at once. Failure on your part to do this will cause us to take action which will entail considerable additional expense to yourself. That letter was addressed to Mr. Robert Sterritt, at Guttenberg, Iowa. I have also a letter from Mr. M. A. Fauver, proprietor of the Pastime Theater, Logan, Iowa, in which he says: I am inclosing you letter which will explain itself. I do not understand this music tax, but it looks to me a good deal like blackjack_work. For instance, if I should buy a McCormick grain binder for my use I could cut grain for my neighbor for hire without paying a royalty for so doing. I believe the binder is patented and copyrighted as well as music. Am sending them my check for amount asked, as it will cost less than litigation. These letters are as follows: AMERICAN SOCIETY OF COMPOSERS, AUTHORS, AND PUBLISHERS, PASTIME THEATER, Logan, Iowa. Des Moines, Iowa, December 4, 1922. GENTLEMEN: On the 27th day of November I forwarded you contracts for a license with this society. Kindly return the license properly executed, together with your check in the sum of $23.20, in the event you desire a license. If not, kindly return the contracts, as infringement reports have been sent in on your theater, and it is necessary for this office to report promptly the status of the case. Yours truly, R. B. McCONLOGUE. SIDNEY S. COHEN, President M. P. T. O. of America. PASTIME THEATER, Logan, Iowa, December 11, 1922. DEAR SIR: Am inclosing you letter which will explain itself. I do not understand this music tax, but it looks to me a good deal likeblackjack work. For instance, if I should buy a McCormick grain binder for my use, I could cut grain for my neighbor for hire without paying a royalty for so doing. I believe the binder is patented and copyrighted as well as music. Am sending them my check for amount asked, as it will cost less than litigation. Very respectfully, M. A. FAUVER, Owner. There is a practical illustration of the statements I have made relative to this situation. The letter was one from this Mr. McConlogue to this man saying that "on the 27th of November I forwarded you contracts for a license with this society. Kindly return the license properly executed, together with your check in the sum of $23.27, in the event you desire a license. If not, kindly return the contracts, as infringement reports have been sent in on your theater, and it is necessary for this office to report promptly the status of the case." We have an incident where their representative in Dallas, Tex., having the franchise territory of Texas, Oklahoma, and Arkansas, sent this letter to a theater owner-he is quite a letter writertelling this man to send the money on contract, and if he did not do so they have detectives and spies going into his theater, and that he might as well pay it now or they would get him a little later, and |