From the 1920's on, independent movie theater owners nationwide faced numerous unfair trade practices from film producers and distributors. What's more, as the producers built or acquired movie houses, independent exhibitors faced direct competition as well. Although the U.S. Justice Department at long last initiated an anti-trust suit 1938, the result was a 1940 consent decree that was unsatisfactory to exhibitors.
In Minnesota, opposition to the consent decree led to passage of state legislation in 1941 designed to mitigate what was considered the most abusive trade practice---block booking---and protect small business. When that law was twice challenged in Ramsey County District Court, the arguments and decisions mirrored debates in the U.S. Supreme Court, congress, and the state legislature over property rights that have raged since the early days of the Republic. The law was upheld by Judge Hugo Hanft in October 1941, but declared unconstitutional by Judge Albin S. Pearson in April 1942. The full texts of the decisions of Judges Hanft and Pearson are posted in the Appendix.
When the U. S. Justice Department restarted its anti-trust case after World War II, the result, in United States v. Paramount Pictures, 334 U. S. 131 (1948), was the end of block booking and the split up of film production and distribution from exhibition. That case clearly benefited independent film producers by giving them greater access to the best and largest metropolitan theaters, and the end of block booking opened up access for their one-at-a-time films.
For Minnesota's independent theater owners, however, the result was disappointing. For them, the end of block booking brought price competition with other theaters for each film. At the same time, producer-distributors demanded payment as a percentage of gross ticket receipts---resulting in steep cost increases just as the industry was beginning to be walloped by television. The well-known result, throughout the 1950's and 60's, was the inexorable decline of independently-owned, single screen theaters.
The author, Thomas L. Olson, died on September 29, 2020, at age 78. He earned a Ph.D. in American history from the University of Minnesota. He is the author of "Sheldon's Gift: Music, Movies and Melodrama in the Desirable City" (2009), which centers on Red Wing's Sheldon Theater. as well as four book reviews posted on the Minnesota Legal History Project website.