The legal hassles revolving around "Dancin' In The Street!" at Ford's continue, contrary to previously published avowals. A letter from Motown telling the theater to "cease and desist" performances of the show, which includes a substantial number of Motown songs, was delivered opening night, but on the advice of attorney Edward McDermott Jr., the theater decided to go on with the show.

The basic problem is not between Ford's and Motown, but between Motown and the six Boston producers of the show who originated it. Everybody's mum on what the sticking point or points are between the two, but it is known that last week three producers were prepared to sign an agreement with Motown, and three were balking. Ford's executive producer Frankie Hewitt says that she was assured, both verbally and in writing when she got the rights for the show from the Boston producers, that the problems with Motown would be solved. "The people in Boston reneged," she said. "We've been totally misled by them."

Attorneys for the Boston company said the hassles began in 1981 when the producers tried to contact Motown about arranging rights to the show. They received no reply, said attorney John Margolis, even to a certified letter. Once the show had opened, operating under a less expensive ASCAP license, Motown sent a "cease and desist" letter. In reply, the "Dancin' " company filed a suit against Motown, asking the court to rule that the company had the right to proceed. For the past six months negotiations have dragged on, with Motown filing motions to dismiss and the "Dancin' " company filing for a temporary restraining order to prevent withdrawal of its ASCAP license. Margolis, needless to say, disagrees with Hewitt's assessment of his clients: "I wouldn't call her a liar, but the situation is far more complex than she is letting on."

Lawyers for Motown did not return a reporter's phone calls.

The most recent action came last Thursday with a hearing in Boston's District Court at which the "Dancin' " company was assured that it could continue under the ASCAP license granted to the hotel in which it performs, Margolis said. The basic issues between Motown and the producers, however, remain unresolved.

Motown's reason for sending the letter to Ford's, McDermott speculated, was "to preserve their position; they want to make some people know what they think their rights are . . . By putting pressure on us they think we'll put pressure on Boston to settle. But it's really between those two parties."