RKO Radio Pictures

by Richard B. Jewell

  The action was taken at the behest of independent theater owners who had long complained that the distribution practices of the major studios were monopolistic and unfair to their businesses. Although nothing concrete had been determined when the year came to an end, the future operations of RKO, as well as those of MGM, Paramount, Warner Bros., Twentieth Century-Fox, and the other companies, were uncertain.

  Then there was the receivership imbroglio, which, like the man who came to dinner, seemed determined never to depart. After the leadership issue was resolved in October, it was predicted that the latest reorganization plan submitted to the court was truly the one.60 By year's end, however, final arrangements were still incomplete; various postponements, technical details, and objections had again bogged down the hearings.

  On the bright side, box-office business in general made an upward move at the close of 1938, and Pandro Berman had some attractive-looking pictures ready for release early in the new year.

  The biggest question mark was George J. Schaefer. How long would it take the new RKO president to analyze his company and formulate an enlightened program for the future? How would he approach the job in comparison to his predecessors, particularly Aylesworth and Spitz? How would he get along with such seasoned executives as Depinet, McDonough, and Berman? And what would Schaefer's relationship be to the three powerful groups whose interest in RKO remained keen: Atlas (Odlum), RCA (Sarnoff), and the Rockefellers?

  8. “The company's best interest”

  The Schaefer-Berman Regime (1939)

  Unlike all of RKO's previous corporate presidents, fifty-one-year-old George J. Schaefer was a tempered industry veteran. He had spent more than a quarter century in the distribution end of the business, beginning as a salesman for the old World Film Company. Later he worked as a booker, branch manager, district manager, general sales manager, and vice-president of Paramount before accepting the position of vice-president and general manager of United Artists.1

  Given his background, it could be expected that Schaefer would work closely with Ned Depinet on the promotion and marketing of RKO films, leaving the creative decisions in the hands of Pandro Berman and his West Coast staff. But the new RKO president had different ideas. He intended to involve himself in every aspect of the corporation—especially production strategies and decision making. Approaching his job with a passion never previously demonstrated by any RKO corporate head, George Schaefer completely revamped the RKO filmmaking emphases and image within one year. In the process, he implemented a number of policies that would contribute both to the everlasting fame of RKO and to its near-ruination.

  Schaefer must have felt blessed that Gunga Din, one of the most exciting productions in RKO history, would be among the first releases of his new regime. As previously mentioned, rights to the famous poem had been purchased from the Kipling estate by Edward Small's Reliance Pictures in 1936. The cost, 4,700 pounds plus 100 pounds for the rights to a song entitled “Gunga Din” written by Rudyard Kipling and Gerard Cobb, were assumed by RKO as part of its production deal with Small.2 After some preliminary script work by William Faulkner, Howard Hawks was given the directorial assignment. Hawks interested two of the industry's foremost writers, Ben Hecht and Charles MacArthur, in the project, arranging to meet them in New York in fall 1936 to work on the screenplay. The three cloistered themselves at the Waldorf Astoria Hotel, but made little progress for the first six weeks. Sam Briskin, production head at the time, was becoming desperate when he received the following telegram from the threesome: “Have finally figured out tale involving two sacrifices, one for love, the other for England, which neither resembles BENGAL LANCERS nor CHARGE OF THE LIGHT BRIGADE and contains something like two thousand deaths, thirty elephants and a peck of maharajas. We have this now in a cocktail shaker and have poured out some thirty five pages of glittering prose.”3

  Briskin's reply, wired the same day, revealed a notable absence of humor: “Can't understand your going so far wrong as to write story which does not resemble BENGAL LANCERS and CHARGE OF LIGHT BRIGADE. Are you boys slipping? Besides, when I want something out of a cocktail shaker I don't want prose.”4

  While the writing continued, Briskin began attempting to line up a suitable cast in hopes that shooting could begin before the end of 1936. Predictably, the major challenge would be securing virile male stars to play the three leads. RKO had no one suitable under contract, so it had to negotiate borrowing arrangements with other studios or independent producers. For a time, it appeared Ronald Colman might head the cast, but the script was not finished in time and Colman proceeded to other commitments.5

  When the Hecht-MacArthur screenplay was finally ready (April 1937), casting difficulties made it impossible to go forward. Briskin tried to convince Louis B. Mayer of MGM to loan to RKO Clark Gable, Spencer Tracy, and Franchot Tone in exchange for an old RKO property that Mayer wished to remake, Rio Rita. Mayer agreed to Tone and Tracy, but absolutely refused to lend out Gable.6 So Gunga Din was placed on the shelf while Hawks directed Bringing Up Baby and the studio executives attempted to find a way to cast the adventure film properly.

  After the Bringing Up Baby debacle, Howard Hawks was fired and George Stevens inherited the project. A good deal of rewriting had taken place in the interim, with Anthony Veiller, Dudley Nichols, Joel Sayre, Fred Guiol, and others taking a crack at the original Hecht-MacArthur work. Believing that the picture had enormous box-office potential, Pandro Berman consented to Stevens's request to shoot some of it on location and to spare no expense in making Gunga Din an epic spectacular. The cast was finalized just before the June starting date. For the three appealing leads, Cary Grant, whose popularity had skyrocketed in the past two years, was joined by Victor McLaglen and Douglas Fairbanks, Jr. Sam Jaffe accepted the role of the eponymous hero.

  The sets were readied at Lone Pine, California, where the Sierra Nevada mountains would provide a majestic backdrop for the action. RKO also had to construct a small city nearby capable of housing, feeding, and entertaining the six hundred workers who would be contributing to the production. The initial shooting took place in the studio, however. Because commitments were piling up, Berman decided to begin the picture as scheduled on June 24 even though Stevens still did not have a script that satisfied him. It was suicidal to start a picture of this magnitude without a final script (and thus, without a reliable budget), but production chief Berman had faith in George Stevens, a man whose record exemplified reliability as well as quality.

  Even though the writing was still only a few days ahead of daily shooting on July 6, a tentative budget of $1,332,000 was determined, based on a sixty-four-day shooting schedule. As J. R. McDonough wrote Leo Spitz, there appeared to be room for further cutting, and Stevens believed he could bring in Gunga Din for a $1.2 million final cost.7

  Everything changed when the company actually went on location. Suddenly, Stevens became slower and more painstaking than Howard Hawks had ever been. In the words of Pandro Berman: “We sent him [Stevens] up to Lone Pine, Cal., to photograph the mountains up there where we built the temples and so on to represent Indian backgrounds. And we sent him up for ten days with a big crowd of extras and a big camp and a big catering operation. That ten days was very expensive. Well, it wasn't ten days. It was thirty.”8

  Before Berman finally blew the whistle and demanded that Stevens return to the studio, the production was far behind schedule and the budget had bloated to a disastrous level. On September 1, J. R. McDonough placed the new estimate at $1,750,000 with at least thirty days of work left.9 McDonough's prognostication again proved conservative; shooting finally culminated in mid-October. Instead of the originally planned 64 days of production, 104 were necessary to complete the movie. And the final cost was a staggering $1,915,000, making Gunga Din the most expensive picture RKO had ever produced. When it was over, Pan Berman felt sure the undertaking would bankrupt the studio.10

  George Schaefer was not so pessimistic. A month after assuming the RKO pres
idency, Schaefer attended a preview and wired Ned Depinet: “Tremendously enthusiastic over screening of GUNGA DIN last night and very happy…with audience reaction. Picture played just about as fine as one could expect and I'm really and truly very enthusiastic about it. Great suspense, action, and Grant, Fairbanks and McLaglen each give finest jobs I have seen on the screen…. It is so important that we do the right kind of job both domestic and abroad and give [GUNGA DIN] every piece of exploitation and advertising possible.”11

  The sales staff followed Schaefer's instructions. Before and after the world premiere on January 24, 1939, at the Pantages Theater in Hollywood, RKO proclaimed the achievements of Gunga Din from coast to coast and around the world. It did superlative business every place but India, where the censorship board banned the picture because of imperialist overtones and objectionable plot elements, such as the intention of the three sergeants to loot a sacred temple. However, the prohibitive cost made it impossible for Gunga Din to show a profit. After the initial release, the picture was a $193,000 loser, though subsequent rereleases would bring it firmly into the black. Gunga Din launched 1939 for Schaefer and RKO with a bang, but there would be other cinematic triumphs during the year as well.

  In January, George Schaefer and Ned Depinet traveled to California. After studying studio operations for a time, the two executives left Hollywood for a few days to discuss RKO production strategy for the coming year with Pandro Berman. They chose La Quinta, a quiet desert community near Palm Springs, for their meetings.

  The deliberations produced the following tentative plans. The 1939-1940 program would cost $14,844,000, including both features and short subjects. Twelve “big” pictures, to be made for a total expenditure of $10 million, would headline the releases. In addition, there would be six “in-between” films, budgeted at $200,000 each; twenty B pictures ($125,000 average cost); and six George O'Brien Westerns, to be made for $85,000 each.12 The scheme reflected a healthy distrust, developed in earlier years, of the true “in-between” or “borderline” picture—a film in the $300,000 to $700,000 range. None would be produced.

  As George Schaefer indicated to Andrew Christensen of Irving Trust later in January, the most immediate necessity was to acquire suitable story material for the expensive pictures: “Other than the one property, THE HUNCHBACK OF NOTRE DAME, which we are purchasing, there is no material ahead of us, either in story or original script form and we, therefore, have to start from scratch. We are proceeding to try to line up from ten to twelve worthwhile productions.”13 Schaefer then decided to pursue independent production deals in hopes of acquiring “important” properties for his company to release.

  Figure 20. George Schaefer, photographed while he was serving as RKO corporate president. Schaefer decided to transform the company's image and filmmaking practices during his time at the helm. (Courtesy of the University of Southern California, on behalf of USC Special Collections)

  He moved quickly. One of the first independents signed was a team of Broadway theatrical impresarios, Max Gordon and Harry Goetz. Their company, Max Gordon Plays and Pictures, would provide RKO with the services of the two men as producers and give the studio an inside position on the plays they produced.14 Schaefer was especially anxious to secure the rights to The American Way, a patriotic drama Gordon and Goetz controlled. The deal enabled RKO to acquire the play (for a fee of $250,000), plus Abe Lincoln in Illinois, another coveted theatrical property.

  Also joining RKO would be the screenwriting team of Gene Towne and Graham Baker. They had penned the scripts for You Only Live Once (1937), the Fritz Lang-directed film about the plight of ex-convicts in America, and for the RKO disappointment Joy of Living; now they intended to produce films based on classic literary works through a company called The Play's The Thing Productions. Swiss Family Robinson would be their initial undertaking. In addition, former silent comedy star Harold Lloyd agreed to oversee movies for RKO release. And a new American-British producing concern, Imperator-Radio Pictures, was formed between Herbert Wilcox and RKO.15 Wilcox had decided to relocate his operations from London to Hollywood, where his first film would be Nurse Edith Cavell, directed by Wilcox and starring Anna Neagle.

  In late February, George Schaefer wrote Pandro Berman disclosing his plans “to release possibly eight (8) or ten (10) quality pictures, independently financed but produced on our lot.” Schaefer listed Ivanhoe, two George Stevens productions, two Leo McCarey productions, one Gregory La Cava production, and The First Rebel (later produced and released under the title Allegheny Uprising) as constituting the bulk of the company's own forthcoming A releases. Berman was instructed to give his “undivided attention” to this group of “special” offerings, leaving the “program” pictures securely in the hands of Lee Marcus. Marcus was to receive $4 million to produce twenty-eight pictures, and he was to decide the budget of each film in consultation with J. R. McDonough. The last paragraph of Schaefer's letter to Berman is of special interest: “In connection with the approval of this budget, it is important to note that I am working on the principle, with which the Board concur, that having approved the budget for the number of pictures indicated, thereafter the selection of material, stories, plays et cetera, and the producing of pictures is left entirely to the management.”16

  George Schaefer's performance already belied his words. As the year unfolded, he would become more and more involved in production decisions—from story selection to creative assignments to casting. Predictably, conflict between Schaefer and Berman soon took root, grew, and flowered very quickly. Schaefer's constant interference, as well as his cavalier decisions regarding the hiring of independents, disturbed the production chief intensely.

  On March 1, 1939, Berman announced to Schaefer:

  I will not bore you by going into the detail of how long I have been attempting to accomplish this deed, and for what various reasons of loyalty and friendship I have restrained myself, but I simply want to state that regardless of any circumstances whatsoever I do not wish to continue my employment in the motion picture business as of the expiration of my present contract in March, 1940. I am going to take off a considerable amount of time and travel around the world for my health, which my doctors have advised me will not stand many more years of the strain and responsibilities that I have been going through for the past ten years…. I know the only way to get peace of mind will be by severing all connections with the industry until I am in a position to return.17

  Continuing, Berman informed his boss that he was happy with the company and with Schaefer as president and that there were no ulterior motives in back of his decision. There was more politeness than veracity to Berman's words. In truth, Pandro Berman was distinctly upset with George Schaefer's leadership.

  Naturally, Berman resented Schaefer's meddling in the studio chief's job and his insistence that final say in production decisions (even involving B pictures) belonged to him. Another sore point was Schaefer's headlong rush to sign up independent units. Pandro Berman was not antagonistic to the unit concept, but he was offended that George Schaefer negotiated agreements without consulting him about the potential producers. As Berman later told Mike Steen: “I was always resentful of the fact that he [Schaefer] did not discuss any of his deals with me…. I felt I had a lot to tell about an awful lot of people he was hiring whom I wouldn't have hired…. So, this really started me on my way out of RKO. I began to get burned up about it, and I resigned as a result.”18 George Schaefer did not try to change Berman's mind, nor did he shed any tears at the prospect of the RKO veteran's departure. Soon enough he would be in full control of all aspects of the corporation, which is precisely what he wanted.

  Pandro Berman took no credit for one of the company's best 1939 productions, Love Affair, though he deserved praise for backing producer-director Leo McCarey despite some very long odds. Like Gunga Din, the McCarey picture went before the cameras without benefit of a completed script. The original story was called Love Match. It concerned a tragic
affair between a French ambassador and an American woman in the mid-1800s. Irene Dunne, who had worked with McCarey in The Awful Truth, and Charles Boyer were cast in the major roles. Shortly before production was to begin, however, the French government launched a formal protest against the project, which it felt might disturb Franco-American relations at a time when war was becoming a certainty. RKO decided to abandon Love Match, but to allow McCarey to go ahead with a new film, working “off the cuff,” as Mac McDonough called it.19 A number of writers toiled on the picture, though Mildred Cram and Delmer Daves concocted most of it. McCarey also encouraged his actors to improvise a good deal. With a lesser director at the helm, the results would likely have been calamitous.

  Leo McCarey was no miracle worker. The film did go over schedule and over budget, though these overages hardly compare to the ones run up by Gunga Din. Approximately ten days into shooting in October, McDonough guessed the film would cost about $800,000.20 Without a script to estimate from, this figure was purely hypothetical, but when the picture wrapped in late December, its final cost was only $60,000 more than McDonough had figured.

  The biggest surprise of all came when the film was assembled for preview. Magically, it appeared to be one of the most carefully constructed and skillfully executed love stories in the history of the cinema. Sensitive, poignant, heartbreaking, and heartening at the same time, Love Affair certainly did not look like an “off the cuff” job. The film earned a respectable profit of $221,000—not stunning, but still amazing considering the circumstances that surrounded its production. It also garnered Academy Award nominations for Best Picture, Best Actress (Irene Dunne), Best Supporting Actress (Maria Ouspenskaya), Best Original Story (Mildred Cram and Leo McCarey), Best Art Direction (Van Nest Polglase and Al Herman), and Best Song (Buddy DeSylva for “Wishing”).