As a media-obsessed kid living in Los Angeles in 1968 (with school friends whose parents were Academy members), I can only tell you Mia Farrow was considered a lock for a Best Actress nomination throughout most of the year; it was practically a foregone conclusion she'd get one. So more than a few eyebrows were raised when the nominations were announced in 1969 and she came away empty-handed.
There was never any doubt Joanne Woodward ("Rachel, Rachel") would also be nominated, and the same was true of both Barbra Streisand ("Funny Girl") and Katharine Hepburn ("Lion in Winter"). I can only say that things got muddy toward the end of the year with "Subject Was Roses" and "Isadora" going into release; there was a huge wave of sympathy for Patricia Neal in the former, and Vanessa Redgrave was a real wild card in the latter (her politics were unpopular even then, but buzz about her performance was strong). When the nominations were announced, Farrow found herself edged out.
Of course, theories have abounded: Farrow was either done in by the film's comparatively early release date (and the Oscar voters' short memories) or the Academy's lack of respect for the horror genre - though neither of these prevented AMPAS from honoring Ruth Gordon. Some even blamed the residual effects of her high-profile marital meltdown with Frank Sinatra.
But it's the Oscars, and there's a controversy associated with them practically every year; taking them seriously is always a mistake.
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