Full opinion text
DELEHANT, District Judge. Relying upon the jurisdictional grant of Title 15 U.S.C.A. § 4, plaintiff instituted this proceeding to obtain injunc-tive relief against the defendants, and each of them forbidding their violation of Title 15 U.S.C.A. § 1, upon whose alleged earlier violation, infra, the prayer was premised. The action was brought in the first instance only against the three corporate defendants. The individual defendant was later brought into it upon motion. The complaint will first be summarized at some length. Thereafter, the general nature of the answers of the defendants will be noted briefly. The complaint, as amended, first identifies the parties defendant, whose correct identification, varying in some measure from the original averments of the complaint, will be reflected in the findings of fact, infra, and alleges (a) that defendant, Central States Theatre Corporation, manages 76th and West Dodge Drive-In Theatre, Omaha, Nebraska, and Council Bluffs Drive-In Theatre, Council Bluffs, Iowa; (b) that defendant, Frank D. Rubel, of Des Moines, Iowa, is District Manager of Central States Theatre Corporation, and is film buyer for and in charge of operations of the two drive-in theatres mentioned in the last preceding clause hereof; (c) that defendant, Center Drive-In Theatre Company owns and operates 84th and Center Drive-In Theatre, Omaha, Nebraska; and that defendant, Midwest Drive-In Theatre Company, owns and operates Airport Drive-In Theatre, Carter Lake, Iowa. It then defines a “Drive-In Theatre” as “an open air motion picture theatre so provided with roadways, parking areas, sound amplifiers, and motion picture screens as to permit its patrons to drive into the theatre area in automobiles, and to park in such a manner that they may view the performance from their automobiles.” And it utilizes the characterization, “Omaha area,” which it defines as “the area included in the Counties of Washington, Douglas and Sarpy, in Nebraska, and the Counties of Pottawattamie and Mills, in Iowa.” It next, in a sequence of four paragraphs copied verbatim in a footnote hereto, alleges that the “Drive-In Theatre” operation in the "Omaha area” substantially involves and affects interstate commerce, and that The Omaha World Herald, a daily newspaper published in Omaha, is regularly utilized by operators of such theatres as an advertising medium. The complaint, thereupon, avers that, beginning on or about February 4, 1955, and continuing thereafter up to and including its filing, the defendants, and others unknown to plaintiff, had been engaged in a combination and conspiracy in unreasonable restraint of the trade and commerce defined in footnote 2 hereof, in violation of Title 15 U.S.C.A. § 1, and were continuing, and unless enjoined therefrom, would continue such offense. That combination and conspiracy are asserted to consist of a continuing agreement, understanding, and concert of action among the defendants, the substantial terms of which had been, and were, that they agreed: “(a) To fix, establish, and maintain uniform and non-competitive prices to be.charged for admission to defendants’ theatres; “(b) To fix, establish and maintain maximum dollar amounts for newspaper advertising to be expended by or on behalf of defendants’ theatres; “(c) To fix, establish and maintain uniform and non-competitive prices to be charged for food and beverages sold at defendants’ thea-tres; “(d) To threaten to refrain from dealing with distributors who provide pictures to drive-in theatres for exhibition at admission prices below those agreed upon by defendants.” That allegation is followed by another to the effect that in carrying out and effectuating such combination and conspiracy, the defendants had done those-things which, it had theretofore been alleged, supra, they had conspired and', agreed to do. Finally, the complaint alleges that the-asserted combination and conspiracy had; the following effects, among others: “(a) Members of the public are-denied the opportunity of seeing-.motion pictures at drive-in theatres-in the Omaha area, in Nebraska and' Iowa at admission prices determined in a free, competitive market; “(b) Distributors are deprived of the benefits of a free, competitive-market for the motion pictures distributed by them in interstate commerce in the Omaha area; “(c) The volume of theatre advertising purchased by defendants from newspapers circulating in interstate commerce is substantially-lessened.” And in its complaint, plaintiff prays: “1. That the aforesaid combination and conspiracy among the defendants in restraint of interstate trade and commerce be adjudged and ■decreed to be in violation of Section 1 of the Sherman Act. “2. That the defendants and their officers, directors, agents, representatives, and all persons acting, or claiming to act on their behalf, "be perpetually enjoined from being ■a party to agreements, contracts, relationships, understandings, or practices having the purpose or effect of •continuing, reviving, or renewing any of the violations of the Sherman Act hereinbefore set forth and described. “3. That the plaintiff may have .■such other, further, and different relief as the nature of the case may require and to the Court may seem just and proper. “4. That the plaintiff recover its taxable costs.” By way of answer, defendant, Central •States Theatre Corporation, admits that fit is a corporation (though it mistakenly admits that, as originally alleged in' the complaint, it is incorporated in Iowa), that substantially all films exhibited in theatres in or near Omaha, Nebraska, are made in states other than Nebraska or Iowa, and that plaintiff’s ■definition of a “Drive-In Theatre” is "“fairly comprehensive,” and, for the rest ■either categorically denies, or denies its ■possession of information respecting the "truth of, the other allegations of the ■complaint. Its denial of its own management of 76th and West Dodge Drive-In Theatre, and of Council Bluffs Drive-In Theatre, is supplemented and amplified by allegations (a) that by contract :Smith Management Company, of Boston, Massachusetts manages those theatres, "but has committed the supervision and ■control of their actual operation and •management, including the procurement -of pictures for exhibition in such thea-tres, to defendant, Frank D. Rubel, as an individual, who receives his compensation for such services directly from the respective corporate owners of such theatres, and (b) that the answering defendant, under arrangement with Smith Management Company, keeps the books and records of those two theatres, rendering accounting therefor to Smith Management Company, and disburses such funds as may be required for the maintenance and operation of such thea-tres. The denial by that answer of plaintiff’s allegations of the inclusion within the reach of interstate commerce of the operation of the drive-in motion picture business in the “Omaha area” is enlarged and amplified by some affirmative allegations touching the transportation of films for use in such operation, and the assertion that the delivery, exhibition and return of such films are entirely intrastate in character. That answering defendant particularly denies that it transacts business, or is found, in the District of Nebraska, and that valid service of summons can be, or has been, made upon it in the District of Nebraska. And it denies both the sufficiency of the averments of the' complaint to state a claim upon which the relief prayed for can be granted, and also the jurisdiction of this court either over the person of such defendant, or to grant the relief prayed as against such defendant. The defendant, Center Drive-In Thea-tre Company, by answer, admits (a) that it is a corporation formed under the laws of Nebraska, with its principal place of business in Omaha, Nebraska, and transacts business in the District of Nebraska, (b) plaintiff’s pleaded definition of "Drive-In Theatre” supra, (c) that motion picture distributors enter into contracts with each of the defendants pursuant to which the distributors lease motion picture films to each of the defendants, and license each of them to exhibit said films in its theatres (which admission the court regards as being operative only in respect of the admitting defendant’s own operations and not as attributing a course of action to any other defendant), (d) that motion picture film exhibited in its theatre has been made in a state or states other than Iowa or Nebraska, and, upon being made is transported from outside Nebraska and Iowa to an exchange or distributing center of the respective film company or distributor (but, making such admission with the affirmative assertion that film “is then at rest”), (e) that a substantial number of contracts for film exhibition in the Omaha area provide that the exhibitor shall pay to distributors for the privilege of exhibiting the film, a percentage of the boxoffiee receipts obtained from exhibiting the film in distributors’ theatres, and (f) that, as a part of their endeavor to secure patronage for defendants’ theatres, and to inform the public of the films to be shown in their theatres, the defendants advertise, among other ways, in the Omaha World Herald, a daily newspaper published in the City of Omaha, and circulated from Omaha to many points in Nebraska, Iowa, and other states. Otherwise, defendant, Center Drive-In Theatre Company, either denies, or asserts its want of adequate information to support admission, or denial of, the allegations of the complaint. And such defendant asserts that the complaint fails to state a claim against such defendant on which relief can be granted. By its amended and substituted answer to the complaint, the defendant, Midwest Drive-In Theatre Company , admits (a) that it is a corporation organized under the laws of Nebraska, with its principal place of business in Omaha, Nebraska, and up to March 7, 1958 transacted business in Nebraska, but with the qualification that its sole business so transacted was the operation of Airport Drive-In Theatre located in Pottawattamie County, Iowa, and that it ceased on March 7, 1958 to transact any business in Nebraska or elsewhere, and since that date has transacted no business; (b) that it was a lessee of Airport Drive-In Theatrefrom its opening for business until on or about March 7, 1958, when it ceased the operation of such theatre, and that on or about August 6, 1958, it completely divested itself of its lease operations, or any other interest, in such theatre and, ever since that date, has had, and has no< right, title or interest of any kind,, character or description in such theatre, whether in its real estate, or any personal property, or any interest in its operations, or any right to receive any money, or any interest derived, or to be derived, from such theatre; (c) that plaintiff’s definition of “Drive-In Theatre” is correct, and that plaintiff’s definition of “Omaha area” is correct; (d) that motion picture distributors enter into contracts with each of the defendants, pursuant to which the distributors lease motion picture film to each of the defendants, and license each of them to-exhibit such film in its theatres (understanding this admission as being limited in practical consequence to its own business operations); (e) that the motion picture film exhibited in its theatre was. made in a state or states other than Nebraska or Iowa, and, upon being-made, was transported from outside Ne~ braska and Iowa to an exchange or distributing center of the film company or distributor involved in Omaha, Nebraska, but with the qualification that, once thus arrived, the film “is at rest”; (f) that a substantial number of contracts for film exhibition in the Omaha area provide that the defendants shall pay to distributors, for the privilege of exhibiting the film, a percentage of the box-office receipts obtained from exhibiting •such film in the defendants’ theatres; mid, (g) that the answering defendant, during the time set forth in the complaint, has advertised its theatre, and the motion picture films to be exhibited therein, in Omaha World Herald, a daily newspaper, which is the only daily newspaper published in Omaha, Nebraska, and is (sic) the principal medium used by such defendant in advertising such theatre and film. That answering defendant denies all other averments of the complaint, considering that to be the proper implication of such allegations as are by it said to be factually beyond its knowledge or information. Defendant, Frank D. Rubel, by his answer to the complaint, admits that plaintiff’s definition of “Drive-In Theatre” is fairly comprehensive. And responding to the other allegations of the complaint, he either categorically denies them, or asserts that he is without knowledge or information adequate for his formation of a belief as to their truth. In and by such answer, he also denies that, as to him, this action is controlled or governed by The Sherman Act; asserts that the averments of the complaint are insufficient to state a claim upon which the relief prayed for against him can be granted; and alleges that the court is without jurisdiction over his person, and is without jurisdiction to grant the relief prayed for. Upon order of the court, a pretrial conference was held, of which a written report was prepared, filed and served (filing 64). It dealt principally with several features calculated to simplify the proofs in the case, and to expedite the trial. It is considered unnecessary to reflect the contents of the report at this point. Trial of the action has been had to the court without a jury. The evidence has been received, examined and considered. And exhaustive and competent typewritten briefs have been submitted by counsel, for which the court acknowledges its indebtedness and thorough appreciation. It may frankly be acknowledged that in the trial and submission of the case, to a degree which is fortunately unusual in this forum, counsel on occasion have adverted to each other, and to witnesses supporting views uncongenial to such counsel, with notable asperity. In their larger part, those manifestations of distemper have simply been disregarded. Their essential impersuasiveness has surely not escaped the recognition of their offerors. An advocate rarely convinces a judge or jury by adopting the antipathies of him, or those whose position he undertakes to support, even though the matter in suit arises in an industry rather too notably plagued with the practice of cannibalism. Saying which, the court now undertakes to assure counsel that in each of the contexts which have evoked their more caustic observations, the court has carefully considered the problem of credibility or probative significance, or both, which is there presented by the record. For the rest, their choler is forgotten. And, having been signified principally in unfiled briefs, it is not a part of the formal record. The facts are now set out. Most of them are not disputed. But, of the facts vital to the present decision, some are squarely controverted either in their entirety, or to a substantial extent. For the purposes of this litigation, a “Drive-In Theatre,” is agreed to mean, and to be, an open air motion picture theatre so provided with roadways, parking areas, sound amplifiers, and motion picture screens as to permit the patrons to drive into the theatre area in automobiles, and to park in such a manner that the occupants of each such automobile may view the performance from the automobile in which they are located. For such purposes, too, the term “Omaha area” means the area included in the counties of Washington, Douglas, and Sarpy, in Nebraska, and the counties of Pottawattamie and Mills, in Iowa. From varying, and generally unestablished, dates before February 4, 1955, and on February 4, 1955, and thereafter to and through the time of the trial of this action, the following drive-in thea-tres were located, and during their respective “seasons” were operated, in the Omaha area: (a) The Sky View Drive-In Theatre was, and is, located on Military Avenue, at or near 72nd Street, in Omaha, Nebraska. It was, and is, the area’s largest drive-in theatre. In 1955 it was, and so far as the court is aware, it still is, owned by Benson Drive-In Corporation, of Omaha , and then was, and is, managed by Ralph Blank. Ralph Blank also managed and manages two conventional motion picture theatres in Omaha, the “Admiral” and the “Chief.” Neither the corporate owner of Sky View Drive-In Theatre, nor Ralph Blank, is a party to this litigation. But it arose upon the prompting of, and out of a written letter of complaint to the Department of Justice of the United States from, Monsky, Grodinsky, Good & Cohen (through Mr. Paul F. Good, a member of that firm), counsel for Benson Drive-In Corporation, and for Ralph Blank. That letter was written for and in behalf of Benson Drive-In Corporation at the request of, and with the approval of its contents by, Ralph Blank. (b) Golden Spike Drive-In Theatre, is located at 11402 Dodge Street, in Omaha, Nebraska. It was and is owned by a not precisely identified corporation, of which Solomon John Francis was, and is, a shareholder and officer, and an active participant in its business affairs. Mr. Francis was, and is, also Branch Manager in Charge of Sales of Allied Artists, a corporate producer and distributor of motion pictures, through its Omaha and! Des Moines offices, and . maintains his-residence in Omaha. Neither the corporate owner of Golden Spike Drive-In. Theatre, nor Solomon John Francis, is a. party to this litigation. (c) Grand View Drive-In Theatre-was, and is, located either in the extreme southerly part of Omaha, Nebraska, or-actually beyond the city limits. It is the smallest drive-in theatre in Omaha. Its-ownership and management have not been established. Neither its owner, nor its manager, is a party to this litigation. And beyond the facts of its existence and operation in the Omaha area, it has no> present significance. (d) 76th and West Dodge Drive-In-Theatre, was, and is, located at 76th and. Dodge Streets in Omaha, Nebraska. It-was, before and during 1955, and still is,, owned by Omaha Drive-In Theatre Company, a corporation organized under the* laws of Iowa, and duly authorized to do, and doing, business in Nebraska, whose-officers and directors were, and are, Phillip Smith, Boston, Massachusetts, President, L. J. Wegener, Des Moines, Iowa,. Vice President, Emanual Kurland, Boston, Massachusetts, Secretary, and E. R.. Lehman, Des Moines, Iowa, Treasurer-In 1954 and 1955, and for a considerable-interval thereafter, one Bernard Dudgeon was the local manager of 76th and' West Dodge Drive-In Theatre. However, his managerial authority extended only to the day by day local operation of the theatre, and did not include the formulation or direction of its business program or practices, the procurement of films for exhibition by it, or the management or control of its fiscal affairs. All of those matters were committed to another, or to others, who also had authoritative supervisory control over Mr. Dudgeon, even in respect of those duties whose performance was entrusted to him. The precise identity of such supervisory manager or managers is a question which is sharply controverted. And the facts concerning it, along with the court’s findIng touching it, are reserved for exposition shortly hereafter. Neither Omaha Drive-In Theatre Company, the corporate owner of 76th and West Dodge Drive-In Theatre , nor Bernard Dudgeon, its local manager, through 1955, and for a considerable interval there.after, has been made a party defendant hereto. (e) Council Bluffs Drive-In Theatre was, and is, located near the southwesterly limits of Council Bluffs, Iowa. It was, and is, owned by Midway Drive-In Theatre Company, a corporation organized under the laws of Iowa. Its officers and directors were, and are, the same men identified in the last preceding paragraph as the officers and directors of Omaha Drive-In Theatre Company, who severally occupy identical positions and ■offices in both of the corporations. Through 1954, and until June 1, 1955, ■one Ted Belles was its local operating manager, and on the date last identified he was succeeded by one Gene Cramm. But what has been said in the last preceding paragraph respecting the limited ■extent of Bernard Dudgeon’s management of 76th and West Dodge Drive-In Theatre applies equally and identically to Ted Belles’ management of Council Bluffs Drive-In Theatre, and to the management of Gene Cramm. The subject of its responsible managerial control is also reserved for later attention herein. And in that attention, the two affected thea-tres will be considered together, for their plight is identical. It is observed that neither Midway Drive-In Theatre Company, nor Ted Belles, nor Gene Cramm, Is a party defendant to this case. (d) Airport Drive-In Theatre was, and is, located at Carter Lake, in the state of Iowa, in the neighborhood of the Municipal Airport for the city of Omaha. In 1955, it was owned by Midwest Drive-In Theatre Company, a corporation organized under the laws of Nebraska, with its principal place of business at Omaha, Nebraska. One J. Robert Hoff, through 1954, on February 4, 1955, and thereafter, until March, 1958, was the president of Midwest Drive-In Theatre Company. In that interval, he was also the directing supervisor of its operations, but one Robert Huntling was its local manager. That was not, and is not, J. Robert Hoff’s only, or even his principal, business activity. He was, and is, President of Ballantyne Company, of Omaha, Nebraska, a corporate manufacturer and marketer of motion picture theatre (including drive-in theatres) sound and projection equipment. And he maintains his headquarters in the offices of Ballantyne Company. Midwest Drive-In Theatre Company in March, 1958, subleased its Airport Drive-In Theatre to another unidentified operator, and has not thereafter been, and is not now, engaged in the operation of any theatre. And, in August, 1956, it divested itself entirely of any interest in the theatre property, or any lease thereof. Obviously, Midwest Drive-In Theatre Company is a party defendant to this action. J. Robert Hoff is not. (g) 84th and, Center Drive-In Theatre is located at 84th and Center Streets in Omaha, Nebraska. It was at all times material herein, and is, owned and operated by Center Drive-In Theatre Company, which is a corporation organized under the laws of Nebraska, with its registered principal place of business iii Lincoln, Nebraska. Of that corporation, one Herman S. Gould, at all material times was, and is, Secretary-Treasurer. He was, and is, also the manager of 84th and Center Street Drive-In Theatre. Center Drive-In Theatre Company is one of the defendants in this proceeding. Herman S. Gould is not. Central States Theatre Corporation, one of the defendants to this action, is a corporation organized under the laws of Delaware , with its principal office and place of business in the Paramount Building, in Des Moines, Iowa. Exactly when it was incorporated does not appear, other than that it was before July 24, 1937. Its officers, at all times material herein, have been, and are, Myron Blank (also known as Myron N. Blank), its President and Treasurer, J. N. Blank, its Vice-President and Secretary, and E. R. Lehman, its Assistant Treasurer. It is, and at all times material herein has been, the owner and operator of, and the performer of services for, theatres, both of the conventional and of the drive-in types. It does not own, or as lessee operate, any theatre involved in this litigation. But it is made a party defendant hereto, along with Frank D. Rubel, admittedly one of its employees, upon the faith of allegations substantially to the effect that, at times material herein, including the date of filing this suit, it managed both 76th and West Dodge Drive-In Theatre and Council Bluffs Drive-In Theatre. And, upon the trial, it was made clear that such averment was premised in part, though not entirely, upon the contention that what was done in the matter before the court by defendant, Frank D. Rubel, was by him done, entirely or in part, as an employee of defendant, Central States Theatre Corporation. Such action on the part of Frank D. Rubel, and also the facts relevant to the issue of the alleged, but denied, management of those two theatres by Central States Theatre Corporation, are dealt with later herein. The drive-in theatre season in the Omaha area does not extend through the entire year. It depends upon the weather. With a flexibility rooted in the judgment of the operator, the season may commence late in March or early in April, and may extend to October or into November. And it may be even longer than that. Of the picture films and sound recordings (later herein together referred to as pictures) exhibited in the several drive-in theatres in the Omaha area, at all times herein material — and now — all or nearly all are produced and manufactured in states other than either Nebraska or Iowa, mostly, but not entirely, in California. In order that they may be exhibited in drive-in, and other, theatres in Omaha or Council Bluffs, they are shipped in interstate commerce from places beyond either Nebraska or Iowa, to the places of business in Omaha, Nebraska of the several nationwide picture distributors, each such picture being shipped to the place of business of a distributor engaged in its distribution for the purpose of exhibition. Once arrived in the places of business of such distributors, such pictures, particularly feature pictures, are customarily exhibited in one or more of the larger conventional theatres of the city of Omaha. They are then returned to the places of business of the Omaha distributors, by which they are first inspected in regard to their condition, and then shipped, sometimes in interstate commerce, sometimes as intrastate movements, to exhibiting theatres in cities outside Omaha, either in Iowa, or in Southeastern South Dakota, or in Nebraska. From the latter theatres, they are similarly shipped, at the Omaha distributors’ direction, either to other exhibiting theatres in one or another of the same states, or back to the Omaha distributors. Eventually, such pictures are nearly all returned to the offices of the Omaha distributors, by which they are made available for exhibition in one of the drive-in theatres, supra, in the Omaha area. Under a practice obtaining in the Omaha area at the times material herein, such exhibition in a drive-in theatre in the area was not allowed during an interval, generally defined as thirty-five days, after the exhibition of the picture in a first run theatre in the area. It was during that interval that the pictures were sent for exhibition in theatres outside of Omaha, supra. Following its exhibition in a drive-in theatre in the Omaha area, any such picture was, and is, returned to the office of its Omaha picture distributor. By such distributor, it was, and is, thereupon sent, usually in interstate commerce, to another place, sometimes in that distributoras territory, sometimes to another territory, for further exhibition. And, when such pictures have been so widely exhibited as to have exhausted their market for the time being, they are returned, again usually in interstate commerce, to their respective owners for storage or destruction, or possibly and ultimately for exhumation and employment in the field of television. Both in their procurement from, and return to, the Omaha distributors of pictures by them gotten for exhibition in their respective drive-in the-atres, the owners of the exhibiting thea-tres, either by their own employees or through carriage by them specially arranged for, customarily effect the actual transportation; They both come to the distributors’ offices and get, and later return to such offices, the pictures they exhibit. In the motion picture trade pictures are not sold, but are rather leased for exhibition only, to the owners of the several exhibiting theatres. This practice obtains, and through all times material herein has obtained, in relation to the drive-in theatres in the Omaha area, including the 76th and West Dodge Drive-In Theatre, 84th and Center Drive-In Theatre, Airport Drive-In Theatre, and Council Bluffs Drive-In Theatre, as well as to the other drive-in theatres in the area. The owners of distributing theatres enter into contracts with the distributors of pictures, whereby the distributors lease the pictures and grant to the respective exhibitors licenses for their exhibition at prescribed times, upon defined terms as to rental, and in specified theatres. Such contracts are ordinarily made without reference to the physical whereabouts of the pictures at the dates of the making of the contracts, and compliance with them frequently requires the transportation of the pictures in interstate commerce to the Omaha offices of the respective distributors. They customarily require the lessees to return such pictures after use to the distributors. These contracts are in writing. Whether they are initially prepared in the distributors’ Omaha offices or elsewhere, they are first lodged in, or sent to such offices, and by those offices sent to the home offices of the distributors, nearly all of which are in New York City, for consideration and rejection or approval. Unless and until approved in and by such home offices, those contracts are not final or effective. When approved, such contracts, through signed copies, are returned to the Omaha distributors’ offices for the delivery of copies to the leasing exhibitors. Of such contracts, a considerable, but not exactly determinable, number require that the leasing exhibitors pay for the licenses to exhibit the pictures a prescribed percentage, said in the evidence to vary between thirty percent and fifty percent of the box office receipts from the exhibition of such pictures in the lessees’ theatres. The receipts to which such percentage factor is thus applied are normally the gross receipts of the theatre during the exhibition, not including receipts from concessions and refreshments, and after the deduction of the cost of any “second feature pictures.” In the city of Omaha, there is, and at all times herein involved has been, published only one daily newspaper of citywide circulation, under the name and style of The Omaha World Herald. It has a large circulation in Omaha and throughout the Omaha area, including Council Bluffs, Iowa. Council Bluffs has, and at all times material has had, a single daily newspaper published and circulated within its boundaries, under the name of the Nonpareil. It has no considerable circulation in Omaha. The operators of drive-in theatres in the Omaha area, before and throughout 1954, and continuously thereafter, have employed in their advertising programs the columns of the Omaha World Herald. Upon the strenuously controverted question of the identification of the “management” of the 76th and West Dodge Drive-In Theatre and the Council Bluffs Drive-In Theatre, the court has undertaken fully and carefully to discern, weigh and evaluate all the pertinent evidence. It is extensive, in fact constitutes a substantial part of the entire record made in this suit. Of it much is in writing, but a considerable part is oral. It is sharply in conflict. If there be doubt on that score, it may certainly be dispelled by a recollection of the assurance with which each of the plaintiff, on the one hand, and the defendants, Central States Theatre Corporation and Frank D. Rubel, on the other, argues that the evidence inescapably, or, at the most conservative estimate, overwhelmingly, establishes its or his or their respective position. On, and for an uncertain interval before June 5,1948, a corporation identified as Tri-States Theatre Corporation, organized under the laws of Delaware, with offices in the Paramount Building, Des Moines, Iowa, was engaged in the motion picture theatre business. Then, and for some unestablished time thereafter, one A. H. Blank was its President. On, and for an unestablished period before June 5, 1948, a partnership under the name of Smith Management Com.-pany, of which the partners were Phillip Smith and Richard Smith, both of Brook-line, Massachusetts, had its office in Boston, Massachusetts, where it was engaged in business involving (among possible other things) “the construction, maintenance and operation of Drive-In Theatres.” On, or some time prior to, June 5, 1948, Omaha Drive-In Theatre Company was incorporated. On June 5, 1948 Phillip Smith was its president, and, then or early thereafter, Tri-States Theatre Corporation was the owner of a “stock interest” in it. And it was about to open, and engage in the operation of, the 76th and West Dodge Drive-In Theatre. So, on June 5, 1948, a carefully formulated contract in writing was executed, to which Omaha Drive-In Theatre Company, Smith Management Company, and Tri-States Theatre Corporation were the only parties. It involved, and in terms divided, the management features incident to the operation of that contemplated drive-in theatre. Thus, it provided that, during its effective period from January 1, 1948 to December 31, 1955, Smith Management Company should: “a. Within the budgetary limits which may from time to time be prescribed by the Company, take charge of and supervise the maintenance and operation of said theatre and any other theatres that may be operated by the Company during the term of this agreement. “b. Within the budgetary limits and in accordance with the policies from time to time established by the Company’s Board of Directors, negotiate for the purchase or license of motion picture films to be exhibited in said theatres, advertise, publicise and exploit the exhibition of such films and purchase supplies and other equipment required for the proper operations of said theatres. “c. Deposit receipts from operations to the Company’s account in duly authorized depositaries.” and that Tri-States Theatre Corporation should: “a. Supervise and keep true and accurate books and records showing all income and expense in connection with the operation of said theatres, which books and records shall at all times be available for examination by any of the Directors of the Company or any of its duly authorized representatives. “b. Render to the Company weekly statements showing as far as possible the receipts and disbursements of said theatres, and, at such times as the Company shall reasonably direct, render statements prepared by certified public accountants employed by the Company showing in detail the receipts, expenditures and general operations of said theatres. “c. Disburse such funds as may be required for the proper maintenance and operation of said theatres in accordance with the provisions of this agreement; and keep true and accurate deposit books and check books which shall at all times be available for examination by any of the Directors of the Company or any of the duly authorized representatives.” It also erected a comprehensive program of liaison between Smith Management Company and Tri-States Theatre Corporation, to the end that they might the more efficiently perform their respective duties under its terms. By its paragraph numbered 6, it was provided that: “6. Smith and Tri-States may, upon such terms and for such period of time as they may see fit, agree between themselves as to a division of duties between them other than as hereinbefore provided, including the buying and booking of films to be exhibited in said theatres.” By the first two sentences of its paragraph numbered 7, it was provided that: “As Compensation for services to be rendered by Smith and Tri-States hereunder, the Company shall pay to each of them a sum equal to two percent (2%) of the gross receipts from operations, which payments shall during the term hereof be made on Friday of each week for the week ending with the preceding Sunday. In determining gross receipts, any amounts which may be received on account of any amusement or other tax levied by any governmental authority shall first be deducted.” Thereafter, provision was made in the agreement for the reimbursement of Smith Management Company and TriStates Theatre Corporation severally for their expenses incurred in the perform-anee of their respective tasks, and several other operating details were accorded attention. On December 20,1951, by a supplemental agreement between the parties to the contract of June 5, 1948, it was declared that, prior thereto, Tri-States Theatre Corporation had “disposed of its stock interest in” Omaha Drive-In Theatre Company, and desired “to be relieved of its duties under such management contract as of January 1, 1952,” and TriStates Theatre Corporation was “relieved of its obligations to perform under the management contract referred to herein as of January 1, 1952,” and Omaha Drive-In Theatre Company delegated to Smith Management Company “the duties previously performed by TriStates under the agreement, and Smith hereby agrees to assume and take over the performance of such duties effective January 1, 1952, with the understanding that the compensation formerly paid to Tri-States will be paid to Smith for the extra duties.” While the history of the formal arrangements whereby the management and financial accounting in respect of Midway Drive-In Theatre Company were provided for is not established in this record by written instruments, or with the detail reflected in the foregoing findings touching like services for Omaha Drive-in Theatre Company, it sufficiently appears that the arrangement upon those features respecting both of those theatre operating corporations was essentially identical on and for some time before December 20, 1951, when the foregoing supplemental contract was made, and also that, as of the date last given, the entire management of the business of Midway Drive-In Theatre Company was entrusted to Smith Management Company, in like manner as was the management of the business of Omaha Drive-In Theatre Corporation. But the program contemplated in the agreement of December 20, 1951 proved to be of short duration. For, on March 10, 1952, Smith Management Company wrote and transmitted the following letter to the designated addressees (infra), and sent a carbon copy of it to the defendant, Central States Theatre Corporation : “Philip Smith Operating “Richard A. Smith Theatres Drive-In Theatres Restaurants “Smith Management Company “859 Boylston Street Boston 16, Mass. “Telephone COpley 7-5610 “March 10, 1952 “Des Moines Drive-In Theatre Company “Omaha Drive-In Theatre Company “Midway Drive-In Co. “Drive-In Concessions, Inc. “Gentlemen: “In connection with our employment contracts with you under the terms of which we agree to render certain services for which we receive four per cent (4%) of the gross receipts from the operation of the Drive-In Theatres and concession stands at Des Moines, Council Bluffs, and Omaha, we have delegated certain duties to Central States Theatre Corp. and hereby request that you pay direct to Central States Theatre Corp., 700 Paramount Building, Des Moines, Iowa, fifty per cent of the fee payable to us under the employment contracts; this procedure to be followed until revoked by us. “You are also to pay traveling expenses direct to Central States Theatre Corp. incurred in the performance of the duties which we have delegated to them under our employment contract with you. “Very truly yours, “Smith Management Company “By /a/ Richard A. Smith ' “Richard A. Smith “cc — Central States Theatre Corp.” Beyond question, that letter failed to define or describe in any manner the “certain duties” which it declared that its writer had “delegated * * * to Central States Theatre Corp.” and for which the latter corporation was to be paid, in addition to its expenses, “fifty per cent of the fee payable” to Smith Management Company “under the employment contracts.” But from oral testimony received in the trial, it is found that by those terms the parties meant to describe the functions which, under the agreement of June 5, 1948, had initially been committed to Tri-States Theatre Corporation. Thus, with the aid of considerable oral testimony, the instruments of June 5, 1948 and December 20, 1951, and the letter of March 10, 1952, appear ostensibly to commit to defendant, Central States Theatre Corporation, from and after March 10, 1952 “until revoked by” Smith Management Company , the performance of the bookkeeping and accounting services originally entrusted to Tri-States Theatre Corporation, but to retain in Smith Management Company the management otherwise of the two theatres in controversy. And the defendants, Central States Theatre Corporation and Frank D. Rubel presented much oral evidence, whose import was that in all respects that division of function was consistently maintained and observed in actual practice. Among the items of such evidence supportive of that position of defendants, Central States Theatre Corporation and Frank D. Rubel, and without attempting to identify every such item, some are now mentioned. In their testimony, Myron Blank and Frank D. Rubel declared that Frank D. Rubel alone performed and performs the active supervisory and authoritative management of each of the two theatres involved; that he did not, and does not, perform such management as a part of the duties of his acknowledged general employment by, and relationship with, Central States Theatre Corporation, but performed and performs it rather under an arrangement with Omaha Drive-In Theatre Company and Midway Drive-In Theatre Company respectively, and also with Smith Management Company; that he has received and receives his entire compensation and reimbursement of expenses for his services in the management of each of those theatres in the form of checks in his personal favor from the several corporate owners of those respective theatres; that he performs his managerial duties towards those two theatres upon the basis of his own personal judgment and discretion, uncontrolled and undirected by Central States Theatre Corporation; that his reception of compensation for, and reimbursement for expenses incident to, his management of those two theatres is not unique or peculiar to such theatres, but he receives in the same way and through like channels, mutatis mutandis, his compensation and reimbursement of expenses incident to the management of other theatres not owned by Central States Theatre Corporation ; and that payment for his services and reimbursement of his expenses in connection with his managerial work for theatres owned by Central States Theatre Corporation are made to him by Central States Theatre Corporation. That Mr. Rubel does receive from the corporate owner of each of the two theatres under consideration cheeks in payment for his services and expenses connected with the management of such theatres respectively is found to be true. But the court considers that undoubted fact to be only an evidentiary fact supportive of the view that for each of such theatres his managerial authority comes to him personally and directly from the corporate owner of such theatre. That method of payment may equally be, and as the court is persuaded is, a device or method whereby, to the extent of his services and expenses in behalf of each such the-atre, its owner, by making payment direct to Frank D. Rubel, really compensates Central States Theatre Corporation for the work of Frank D. Rubel, and to that extent relieves Central States of the obligation to pay Frank D. Rubel his salary. But there is evidence in considerable volume and, in the court’s estimation, of persuasive significance, leading to the conclusion that in practical reality, Central States Theatre Corporation actively participated, and participates, in the management of each of the two theatres, and that Frank D. Rubel’s services of that character are referable to his employment by Central States Theatre Corporation. Thus, incident to an investigation by the Department of Justice of the United States, and by way of an “explanatory memorandum” with reference to data and information called for in subpoena served on Central States Theatre Corporation, Mr. E. R. Lehman, who then was not only a Director and Treasurer of both Omaha Drive-In Theatre Company and Midway Drive-In Theatre Company, but also Assistant Treasurer, and the person directly in charge of the accounts and financial records of Central States Theatre Corporation, executed and caused to be delivered to the attorney for the United States, in charge of the presentation of evidence to a grand jury, an affidavit sworn to on January 31, 1956. In the initial factual statement of that affidavit, he stated: “Central States Theatre Corporation, the company named in the subpoena under which the statements herein contained are furnished, has no ownership in any companies operating Drive-In Theatres in the Omaha area. However, through an agreement with Smith Management Company of Boston, Massachusetts, which company holds management contracts with Midway Drive-In Co. and Omaha Drive-In Theatre Company, operators of Drive-In Thea-tres in Pottawattamie County, Iowa, and Douglas County, Nebraska respectively, Central States Theatre Corporation has been employed to manage the corporations’ respective theatres and maintain all corporate books and records. ***** “It is by virtue of its management relationship with Omaha Drive-In Theatre Company and Midway Drive-In Co. that we are able to and do submit to you the following data and information. ***** “Mr. Frank D. Rubel who is presenting this memorandum to the court occupies the position of District Manager and film buyer for all of the Drive-In Theatres which are operated by Central States The-atre Corporation and associated companies, including the Drive-Ins operated by Midway Drive-In Company and the Omaha Drive-In Thea-tre Company. In addition, Mr. Ru-bel has his own personal theatre interests. “In the calendar years 1954 and 1955 he received income from the following companies: Midway Drive-In Theatre Company Des Moines Drive-In Theatre Company Cedar Rapids Drive-In Co. Central States Theatre Corporation Strand Amusement Company Omaha Drive-In Theatre Company Lee Theatre Company “Mr. Rubel’s duties include the leasing of all films for the Drive-In Theatres, hiring of managerial help, purchasing and leasing of ground for any additional Drive-Ins and supervisory management of the theatre, but does not include the care of any records or books or tax forms or corporate records.” It is clear that by such affidavit he attributed the ultimate effective managerial control over both of the theatres under consideration to defendant, Central States Theatre Corporation. However, by an affidavit, sworn to on July 24, 1956 and filed herein on April 22, 1957 (filing 42), Mr. Lehman undertook to repudiate, or to minimize the significance of, nearly all of the material quoted above from his earlier affidavit, and in general to support the position touching the relations of Central States Theatre Corporation and Frank D. Ru-bel towards the management of the two Drive-In Theatres involved, which is contended for by Central States Theatre Corporation and Frank D. Rubel. And in that later affidavit, Mr. Lehman tried to explain his language in the earlier affidavit by a want of comprehension on his part of the precise purpose towards which the earlier affidavit was oriented. Both of the affidavits are before the court, as is also Mr. Lehman’s testimony in the court’s presence, which dealt only briefly with the disparity between the two affidavits. The court has considered in this relation also the evidence, including, so far as they were produced, the written instruments dealing with the management of the two theatres, and the operations of Central States Theatre Corporation and Frank D. Rubel. It is not impossible that it may be said of the quoted portion of the affidavit of January 31, 1956 that it illustrates the truth that: “Many a shaft at random sent Hits mark the archer never meant.” Yet, the question really before the court in respect of it is whether the quoted statements fairly reflect the facts. The court is of the opinion, based upon the entire evidence, that such question must be answered affirmatively. An objective declaration of fact is not to be rejected on the ground alone that its maker did not know precisely why the information was sought. On the contrary, an acknowledge*! awareness of such reason frequently lies at the root of evasion, imprecision, or even downright falsehood in answering. Besides, Mr. Lehman simply could not have been completely ignorant of the use to which the earlier affidavit — and more particularly the information it contained — might be put. The affidavit was knowingly tendered to the attorney for the United States Department of Justice, then engaged or about to be engaged in the presentation of evidence to a Federal Grand Jury. The inquiry of the Grand Jury was clearly aimed at operations of the men and corporations identified with the motion picture industry, who were named in the affidavit. The likelihood was great that it had to do with the Sherman Act. And Mr. Lehman was and is a man of long experience, as well as of close acquaintance with the men and corporations about whom and which he spoke in his affidavit, and their manifestly complex business operations. The court credits the earlier of his affidavits. Doing which, it considers both of the affidavits, Mr. Lehman’s bearing as a witness, and the other evidence respecting the relationship between Central States Theatre Corporation and Frank D. Rubel, and the manner of their dealings, both generally and in connection with the two theatres directly under consideration. Reference will now be made as briefly as possible to that other evidence. That Frank D. Rubel was and is primarily an employee of Central States Theatre Corporation is not questioned. He worked and works, by way of headquarters, in office space in the offices of that corporation. His duties were and are wholly connected with the motion picture industry, which was and is the business in which Central States Theatre Corporation has been engaged throughout its existence. His classification of his own duties through his employment is as a buyer or booker of films, and the supervisor of some theatres. In that classification, he is essentially correct. Incidentally, he also had, in 1955 and thereafter, some interests of his own in theatre operations, the identification of which has not been shown. As the buyer, or more exactly the procurer of leases, of films, he has negotiated for, and procured leases of, films for thea-tres that were and are variously either wholly owned, or partly owned, or managed, by Central States Theatre Corporation. Among the theatres for whose use he has procured the leases of films were, and are, 76th and West Dodge Drive-In Theatre and Council Bluffs Drive-In Theatre (which is found, as yet, without the attribution of that activity to his employment by Central States Theatre Corporation). In all his work, he used and uses the offices of Central States Theatre Corporation, and its telephone facilities, the services of its secretarial staff, and its printed stationery, and its office supplies. Working thus, he has regularly corresponded by mail, on Central States Theatre Corporation stationery, with agencies of the distributors of pictures respecting the leasing of pictures for exhibition at various theatres, including 76th and West Dodge Drive-In Theatre and Council Bluffs Drive-In Theatre. Also, for both of those theatres, he has booked and books under written contracts pictures to be exhibited, and in many such bookings and contracts, has identified Central States Theatre Corporation as the “exhibitor” by the use of that term, and also as the lessee executing the contract. In such execution, each of the contracts bore a stamped copy of the name “Central States Theatre Corp.”, which was followed by the printed word, “by,” and the handwritten signature of Frank D. Rubel. Many contracts were executed in that manner in 1954. The evidence, however, also includes several contracts or proposed contracts for the leasing of pictures for exhibition, some in 76th and West Dodge Drive-In Theatre, some in Council Bluffs Drive-In Theatre, in each of which the exhibitor and maker of the contract is identified as “Omaha Drive-In Theatre Co.” or as “Midway Drive-In Co.,” as the case may be. Those latter contracts were executed in 1955, none earlier than March 4, 1955, most of them substantially later than that. But Mr. Rubel was not the only employee of Central States Theatre Corporation who procured leases of pictures for exhibition in each of the two the-atres, whose management is in controversy. Other persons, employed by it as “film bookers” made such bookings, including Larry E. Day and Neil B. Adair. In both 1954 and 1955, Mr. Day, using Central States Theatre Corporation stationery, conducted correspondence with the Omaha office of Republic Pictures’ distributor respecting such bookings for 76th and West Dodge Drive-In Theatre and Council Bluffs Drive-In Theatre. And during the same interval, as a book-er for Central States Theatre Corporation, and on its identifying printed forms, he repeatedly sought booking confirmations for films for exhibitions in many theatres in Nebraska, and including 76th and West Dodge Drive-In The-atre, and for Council Bluffs Drive-In Theatre, in which the identity of the exhibiting theatres, and the names of the films involved, and the dates of exhibition were disclosed. And, on October 21, 1954, “Neil B. Adair Central States The-atre Corp.,” by telegram to the Omaha office of Republic Pictures, sought the enlargement of exhibition time for a film to be exhibited in Council Bluffs Drive-In Theatre. In the processing of its booking operations in the Omaha area, Central States Theatre Corporation, with substantial regularity, paid with its own checks the license fees for pictures by it booked for exhibition in various Nebraska the-atres, including 76th and West Dodge Drive-In Theatre, and in Council Bluffs Drive-In Theatre. In making such payments, it sometimes made payment on account of a single theatre, but more regularly paid for the use of films in several theatres through a single check. The other Nebraska theatres included houses in Hastings, Holdrege, York, Columbus, Kearney, Norfolk, Albion and Fremont. Only the one Iowa theatre was involved in the payments now recalled. In making these payments, Central States Thea-tre Corporation prepared, or procured, a statement or voucher identifying the several pictures involved, and the information for each of them upon its exhibition dates, and theatre and town or city of its location, and the rental fee. It thereupon paid for all rentals disclosed on the voucher by its single check in favor of the distributor providing such pictures. And promptly, thereupon, it billed each theatre for, and from it collected, the rentals on pictures thus paid for, which had been exhibited in such theatre. The rentals for pictures exhibited in 76th and West Dodge Drive-In Theatre and Council Bluffs Drive-In Theatre were paid in the first instance by Central States Theatre Corporation, and by it later collected from the corporate operator of each theatre in that way. Central States Theatre Corporation upon this submission argues that all of its activities in connection with the booking and scheduling of pictures for 76th and West Dodge Drive-In Theatre and Council Bluffs Drive-In Theatre were merely steps in the way of obtaining verification of film schedules, incident to its disbursing, bookkeeping and accounting operations for those theatres. That those activities facilitated its financial operations and record keeping for, the two theatres is certainly true. But they went much farther. They assured the provision of pictures, the aggregate admission prices for whose exhibition constituted the major part of the income of the theatres, and which even attracted the customers whose purchase of refreshments made up much of the rest of that income. They were a vital and essential part, probably the most vital and essential, of the service rendered by any one in the management of both theatres. And Central States Theatre Corporation performed that service. It performed that service no less certainly because the execution of its details, and the exercise of discretion in respect of it, were committed principally to its employee Frank D. Rubel. But, as has already been found, other employees of Central States Theatre Corporation than Frank D. Ru-bel also participated in the booking operations for those two theatres as a feature of their management. In its operation of 76th and West Dodge Drive-In Theatre, Omaha Drive-In Theatre Company, through Bernard Dudgeon, its local manager, had on hand a supply of Central States Theatre Corporation stationery. How widely and generally such stationery was actually used may not be found with certainty. But it was employed for the purpose, among others, of writing and transmitting “inter office communications” between Omaha Drive-In Theatre Company and Mr. Dudgeon on the one hand, and on the other Mr. Rubel in his office in the quarters of Central States Theatre Corporation. That Central States Theatre Corporation has not had a license to do business in Nebraska, and now has no such license is true and is found by the court. But the court, upon the basis of all of the evidence, further finds that through 1954 and 1955, and thereafter until the time of trial, that corporation, in the way of its managerial services to Omaha Drive-In Theatre, actually was transacting business within the state of Nebraska, which is coterminous with the District of Nebraska. And the court further finds that the participation by Frank D. Rubel in the meeting of February 4,1955 (next hereinafter considered), and in the events which occurred thereafter incident to that meeting, was also the act of Central States Theatre Corporation, and an aspect of its transaction of business in Nebraska. On an inexactly identified date late in January, 1955, Frank D. Rubel was in Omaha. While there, he called on J. Robert Hoff at the latter’s office at 1712 Jackson Street, Omaha. In the course of that conversation, Mr. Hoff said to Mr. Rubel that he had recently theretofore observed in another city a method of advertising used by drive-in theatres which he considered probably to be effective and economical. And he explained it as involving the joinder by the operators of all drive-in theatres in a community in the purchase of group newspaper advertising space in substantial size, and the insertion into that space of advertising by all of them. The advertising thus inserted in each such publication was of two kinds, first, a generalized recommendation of drive-in theatres as such, and, secondly, individualized publicity whereby each exhibitor participating in the project offered support of a particular program to be shown by it. Mr. Hoff professed to see opportunity in that type of advertising, first for the attraction of reader interest by means of the consolidation of drive-in advertisement instead of scattering individual advertisements through the paper, and secondly, for economy through an arrangement whereby all participating advertisers would share the cost of the single generalized recommendation, and the owner of each theatre would pay such additional amount as should be charged on account of th