Theatre Design & Technology - Dec 1974 - 22

From 1919 to the present time, the gradual
growth of the complicated legal structure surrounding professional theatre has moved steadily forward.
Theatrical craftsmen had al ready become part of the
American Federation of Labor. The formal adoption
of the first standard contract between the Actors'
Equity Association and the United Managers' Protective Association took place on October 2, 1917.
The occasion marked the beginning of a long
struggle between the actors and the managers and
culminated in the famous Actors' Strike of 1919. The
strike lasted from August 8 through September 6 and
theatres all over the country closed. The Equity
Association closed one metropolitan attraction after
another, darken ing twenty-one theatres and preventing the presentation of at least six announced
premieres. 13
The legal ramifications of the Actors' Strike were
also felt in the attitude toward the actor's "product"
and the problem of distinguishing between theatre as
"business" and theatre as "art." The actors maintained that their affiliation with organized labor
affected only the conditions under which their art
was practiced. However, another opinion set forth
the principle that "[the] product possesses only an
intang ible qual ity. It nevertheless consists of a
negotiable commodity which his employer sells to the
public for a profit. ,,14 The concept of the actor as
part of a business structure was further emphasized
by litigation to protect the employer against the
inability of the star performer to appear because of
illness. 15
The victory of the actors in their labor dispute
might be cited as one of the prime factors in the
movement of theatre into the realm of a powerful
economic force in American society. The growth in
scope and power of other unions affecting theatrical
production gradually led to the present situation in
which a theatrical venture on Broadway must negotiate contracts with at least twelve separate unions
and the producer must post bonds with six of these.
Samples of these bond figures are:
1) Actor's Equity Association -

2 wks. salary plus $50

2) A.T.P.A.M. (Press Agents, Managers) 3) I.A.T.S.E. #1 (Stagehands) 4) A.F.M. (Musicians) -

1 wk. salary

5) Theatrical Wardrobe Attendants 6) United Scenic Artists -

2 wks. salary

1 wk. salary
1 wk. salary

Full payment (paid to artist in thirds)

The middle years of the twentieth century found
the theatre profession even more tightly connected
by law to other major industries. The influence of the
Federal Securities Act of 1933 is one example of this
amalgamation. The post-depression legislation was
passed as a means of economic control to bolster and
protect the devastated economy of the United States.

At the time of its inception, no one considered the
interests of the theatrical profession inherently
affected. The major provisions of the S.E.A. were
geared toward the protection of "unsophisticated
investors" (i.e. widows and orphans) who might be
tempted to invest funds in unsound business ventures. The guidelines set by the S.E.A. were not
actually applied to theatrical activities until several
decades later when the activities of the Shuberts
came under investigation.
Back in 1907, Messrs. Klaw and Erlanger, the
major forces in the Theatrical Syndicate, were
brought before a grand jury on charges of criminal
conspiracy in restraint of trade. Judge Otto A.
Rosalsky dismissed the indictment against Klaw and
Erlanger on three grounds:
1) that they had a right to keep a business rival from using
their premises,

2) the Shuberts and Belasco were not actually prevented from
exercising their trade; and
3) that theatrical amusements could not be classified as
"articles of trade and commerce" and were therefore not
subject to antitrust laws. 16

And ironic aspect of this case is that although the
Shuberts and Belasco thought they had lost the case,
in actuality the judge's decision worked to their
advantage by enabling them to develop their own
monopoly in the theatre. This monopoly continued
until the Supreme Court finally reversed the decision
in 1955. Recent changes in the corporate structure of
the Shubert Enterprises herald even more complex
problems for theatrical monopolies.
The 1955 decision rose from the government's
civil antitrust suit against Jacob J. and Lee Shubert
and Marcus Heiman. In the Court's decision, the
theatrical activities of the Shubert Brothers were
linked to the bas ball industry and the court held that
legitimate theatre (and professional boxing) were
subject to antitrust laws. This decision was handed
down on January 31, 1955. The interrelationship of
the Securities Exchange Commission and the antitrust regulations' effect on professional theatre was
further clarified in 1963.
By the 1960's, theatre activities had reached
multi-million dollar levels and, as such, were irrevocably linked with "big business." In 1963, the
Attorney General of the State of New York launched
an official investigation into theatrical business
activities. The ultimate result of this complex perusal
of the theatrical "art" is that the financing of
legitimate theatrical activities is now governed by
certai n provisions of two pieces of leg islation:

1) Section 2(1) of the Federal Securities Act of 1933, and
Regulation A issued thereunder; and

THEATRE DESIGN AND TECHNOLOGY

DECEMBER. 1974

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