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Among the first to try his hand at dominating the movie business and reaping its profits, Thomas Edison formed the Motion Picture Patents Company, known as the Trust, in 1908. A cartel of major U.S. and French film producers, the company pooled film-technology patents, acquired most major film distributorships, and signed an exclusive deal with George Eastman, who agreed to supply stock film only to Trust-approved theater companies.

However, some independent producers refused to bow to the Trust’s terms. They abandoned film-production centers in New York and New Jersey and moved to Cuba, Florida, and ultimately Hollywood, California. In particular, two Hungarian immigrants—Adolph Zukor (who would eventually run Paramount Pictures) and William Fox (who would found the Fox Film Corporation, later named Twentieth Century Fox)—wanted to free their movie operations from the Trust’s tyrannical grasp. Zukor’s early companies figured out ways to bypass the Trust. A suit by Fox, a nickelodeon operator turned film distributor, resulted in the Trust’s breakup for restraint of trade violations in 1917.