Schaefer's departure in mid-1942 signaled the deepening financial concerns at RKO, which had not returned to consistent profitability despite the waning Depression, the banner year in 1939 (which resulted in net losses for the studio), and the emergence from receivership in January 1940. By early 1942 it was clear that the "war boom" would be as momentous as the talkie boom that spawned RKO, yet the studio continued to show losses despite the favorable socioeconomic conditions while its major competitors did record business. Floyd Odlum (1892–1976) decided to take charge, sweeping out Schaefer and most of his executive corps in June 1942 (including the former Production Code Administration head Joe Breen, after a brief and disastrous run as production head), and hiring Charles Koerner to run the studio and oversee production. Koerner continued the house-cleaning begun by Odlum, including the termination of the Welles-Mercury contract, and the results were readily evident on the balance statement. RKO reversed its slide and eked out modest profits in 1942, and then surged to record income levels.
Val Lewton was a significant figure in 1940s Hollywood, known primarily for producing a wartime cycle of innovative B-grade horror films for RKO. Lewton's production unit and his role as "hyphenate" writer-producer indicated other important industry trends, as did RKO's effort to upgrade B-picture production to exploit the overheated first-run market during the war boom.
Lewton migrated from Russia to the United States at age ten, and was raised by his mother and her sister, stage and screen star Alla Nazimova. After attending Columbia, he went to work at MGM, where he became producer David Selznick's story editor—a position he continued at Selznick International Pictures from 1935 to 1942, working on such films as Gone with the Wind (1939) and Rebecca (1940) before signing with RKO, where his task was to produce low-budget projects with A-class production values. He assembled a unit that enjoyed immediate success with its debut effort, Cat People (1942), a dark, intense thriller about a Serbian girl, recently arrived in New York, who becomes a deadly tigress when sexually aroused. A modest hit, Cat People rejuvenated the horror genre, introducing a psychosexual dimension and bringing it "closer to home" with its New York setting. The heavy use of shadow and night scenes also served both a practical and a stylistic function, disguising the film's limited resources.
After Cat People , Lewton produced a "female gothic" variation of the horror film with I Walked With a Zombie (1943), a reworking of Jane Eyre (à la Rebecca ). Then in quick succession the unit turned out The Leopard Man , The Seventh Victim , The Ghost Ship (all 1943), and Curse of the Cat People (1944). All were low-cost, black-and-white pictures with short running times, and they scored with both critics and audiences. The key figures were director Jacques Tourneur, cinematographer Nicholas Musuraca, art director Albert D'Agostino, set designer Darrell Silvera, composer Roy Webb, and Lewton himself as producer and frequent cowriter, usually under the pseudonym "Carlos Keith." (Besides Tourneur, who directed Lewton's first three pictures, Mark Robson and Robert Wise also directed for Lewton.)
Lewton's success at RKO faded with three successive Boris Karloff vehicles: The Body Snatcher , Isle of the Dead (both 1945), and Bedlam (1946). All were period pieces set in foreign locales, reaffirming Lewton's ability to attain A-class quality on a B-grade budget, but they were throwbacks to classical horror and distinctly at odds both with Lewton's earlier pictures and with the postwar horrors of the atomic age. When Bedlam failed to return its production costs, RKO declined to renew Lewton's contract. Working freelance, he produced three routine features before his untimely death from a heart attack.
Cat People (1942), I Walked With a Zombie (1943), The Leopard Man (1943), The Seventh Victim (1943), Curse of the Cat People (1944), The Body Snatcher (1945)
McBride, Joseph. "Val Lewton, Director's Producer." Action 11 (January-February 1976): 11–16.
Newman, Kim. Cat People . London: British Film Institute, 1999.
Siegel, Joel E. Val Lewton: The Reality of Terror . London: Secker & Warburg/British Film Institute, 1972.
Telotte, J. P. Dreams of Darkness: Fantasy and the Films of Val Lewton . Urbana and Chicago: University of Illinois Press, 1985.
The key to RKO's wartime reversal was Koerner's diminished reliance on outside independents and heavy concentration on cost-efficient genre production. This
included a return to B-westerns and other low-grade series featuring the Falcon (starring George Sanders [1906–1972]), Tarzan (Johnny Weismuller [1904–1984]), and the Mexican Spitfire (Lupe Velez [1908–1944]). While these ensured steady returns, RKO took greater risks and enjoyed greater returns on its output of stylish, imaginative "near-As"—pictures made on (or slightly above) B-movie budgets but of sufficient quality to compete in the lucrative first-run market. Key here were two contract filmmakers: producer Val Lewton (1904–1951) and director Edward Dmytryk (1908–1999). Lewton, who signed with RKO in 1942, developed a "horror unit" that produced such modest wartime hits as Cat People (1942), I Walked with a Zombie (1943), The Curse of the Cat People (1944), and The Body Snatcher (1945). Lewton's horror gems were heavy on atmosphere and menace but devoid of stars, spectacle, and special effects, and thusly complemented the dark thrillers directed by Dmytryk. A former film editor who became RKO's most prolific and imaginative filmmaker during the war, Dmytryk honed his directing skills on B-grade series pictures before hitting his stride in 1943 with two topical melodramas, Hitler's Children and Behind the Rising Sun , followed by two film noir classics, Murder My Sweet (1944) and Cornered (1945). Dmytryk also showed he could work with top stars with Tender Comrade (1944), a homefront melodrama starring Ginger Rogers.
RKO continued to handle occasional independent productions during the war, such as the 1945 noir masterwork Woman in the Window , directed by Fritz Lang (1890–1976) and produced by International Pictures. The trend resumed with a vengeance in 1945 and 1946, as the war wound down and the demand for B-movie product radically diminished. The most significant independent ventures were Leo McCarey's (1898–1969) Bells of St. Mary's (1945), a sequel to his 1944 Paramount hit, Going My Way ; It's a Wonderful Life (1946) by Frank Capra (1897–1991), which was actually a commercial and critical disappointment upon its initial release; and the Goldwyn-produced, Wyler-directed postwar "rehabilitation" drama, The Best Years of Our Lives , which was RKO's biggest hit of the decade. RKO also signed an important and unusual deal with Selznick in 1945 for several prepackaged films including such major hits as Notorious (1946), The Farmer's Daughter and The Bachelor and the Bobby-Soxer (both 1947). The deal gave Selznick profit participation and also paid him for the services of contract talent "attached" to the films, which included producer Dore Schary (1905–1980), who became RKO's top in-house independent.
RKO's fortunes took a sudden turn in early 1946 with the death of Charles Koerner, resulting in another executive shakeup and Schary's eventual ascent to head of the studio. RKO flourished briefly under Schary, thanks to the Selznick packages as well as signature noir thrillers such as Crossfire and Out of the Past (both 1947). But Schary's regime proved short-lived due to Howard Hughes's purchase of RKO from Floyd Odlum in May 1948. Hughes promptly shut down the studio to reorganize production and to weed out Communists—a process that actually had begun in late 1947 when Dmytryk and producer Adrian Scott (1912–1973), two of the so-called Hollywood Ten, were cited for Contempt of Congress and fired by RKO shortly after the release of their successful collaboration, Crossfire . Studio departures accelerated under Hughes, including the firing of corporate president Peter Rathvon and the resignation of Dore Schary, who left for MGM in July 1948, just as RKO resumed production.