During that time there was effectively a monopoly in the movie business where the major movie studios (such as Paramount, 20th Century Fox, Warner Bros., and a few others) would have contracts with actors, writers, and directors which stipulated that they could only work with their studio. They paid them salaries, as opposed to negotiating rates for individual movies. These companies could also give priority to their own films at the theaters they owned.
This “studio system” continued until independent producers (including Samuel Goldwyn and Walt Disney, among others) challenged this system and a case against the major studios went all the way to the Supreme Court. In 1948 the Supreme Court ruled that the studio structure constituted a monopoly and was no longer legal. They could no longer be immersed in every step of creation and production as well as the owners of the distribution platforms. That was the beginning of the end for the studio system.
