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In his autobiography, director Frank Capra admitted that he wrote the story for Forbidden "with a very large assist from Fannie Hurst's Back Street" (New York, 1931). According to contemporary news items, this film was supposed to have begun production on July 15, 1931 but was delayed due to Barbara Stanwyck's contract dispute with Columbia. While the case was in court, Capra directed Platinum Blonde. After the case was settled, Stanwyck agreed to do Forbidden for the salary stipulated in her contract. According to Hollywood Reporter, Paul Muni was to have co-starred with Stanwyck and Adolphe Menjou. Actor Ralph Bellamy was borrowed from Fox. Although the copyright material and contemporary reviews list Tom Ricketts as "Briggs," the film credits Oliver Eckhardt with the role. A Hollywood Reporter news item does include Ricketts and Martha Mattox in the cast, but their participation in the film has not been verified. Hollywood Reporter also stated that Florence Wix and Claude King were added to the cast. Modern sources also include them and their respective character names, "Mrs. Smith" and "Mr. Jones." A August 31, 1932 Film Daily news item noted that Forbidden was "hailed as a 'screen masterpiece' at the recent International Cinematographic Show in Venice [where] Senator Marconi, Luigi Pirandello and other noted personages were the judges." According to correspondence in the MPAA/PCA Collection at the AMPAS Library, Forbidden was rejected by the PCA in 1935 when Columbia, attempting to re-issue the picture, submitted it for approval. In a letter to Will H. Hays, PCA Director Joseph I. Breen stated that the film "violated the Code, inasmuch as it was basically a glorification of adultery."
According to modern sources, Helen Hayes was first offered the part of Lulu Smith. Modern sources credit Edward Stevenson with costumes and list the following additional cast members: Robert Graves (Mr. Eckner), Harry Holman (Mick, advice to the lovelorn columnist), Bob Parrish, Dick Winslow, Cooke Phelps, Roger Byrne (Office boys), Carmencita Johnson, Seesel Ann Johnson, Larry Dolan, Lynn Compton (Children in Halloween scene), Helen Stuart, Frankie Raymond, Gertrude Pedlar and Wilfred Noy. Modern sources also mention that the film was shot in part at Laguna Beach and Venice, CA.