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Netflix, Warner Sued Over Sellthrough Window

By : Erik Gruenwedel | Posted: 08 Mar 2010

A New York woman has filed a class-action antitrust lawsuit against Netflix and Warner Home Video alleging that the two companies’ recent distribution deal for DVD and Blu-ray Disc movie rentals constitutes a “scheme to restrain trade,” among other charges.

Plaintiff Susan Uman filed the suit March 3 in U.S. District Court for Southern New York in Manhattan, claiming the value of her monthly Netflix subscription suffered in value after the online DVD rental pioneer agreed to delay shipment of new-release and catalog titles from Warner by 28 days in exchange for better disc pricing and copy depth.

Warner and Netflix in January established the groundbreaking deal as a first step among studios looking to create a sellthrough window between the theatrical and rental distribution cycles of new release movies.

Uman, who cited as examples the Feb. 23 DVD releases of The Informant and The Box not being available to Netflix subscribers until March 23, is seeking a halt to the practice, according to the filing.

Indeed, when Netflix approached Warner about the revised distribution deal, it did so largely because the majority (70%) of its subscribers opt for catalog titles compared to new releases.

Representatives from Netflix and Warner Home Video were not immediately available for comment.

Related Stories :

Netflix Agrees to 28-Day Window for New Warner DVDs


User comments

Commented by tedster
Posted on 2010-03-08 17:32:57

This is idiotic. While I don't know if Netflix has protected itself in the small print, this truly is one of the pettiest things I've ever seen. Not because she isn't justified in having suffered a degree of loss (she well might), but that she thinks it is important enough to bring it to trial and waste a lot of money in the process. What she should do is cancel her subscription and request a refund for any service she has paid for but not been given. I am certain Netflix and Warner would rather pay her a refund than go through this nonsense. Instead, one must assume she thinks a bigger issue is going on here--the big boys squashing the helpless consumer. Get a life and realize that companies can offer whatever they want as a service--if you like it, pay for it. If not, don't. This is just petty and wasteful.

Commented by Kim Lapper
Posted on 2010-03-09 15:33:04

If the value of DVD's are not cheap enough, you have a woman who wants companies to lose profits because she is "hurt" by not having a "cheap movie" to view. Cancel her subscription. She is the type of customer who believes it is her right to "Free TV" regardless of what others paid to give it to her "FREE". I will say, PIRATING will go down with this "Real Profit" model. The bleeding has to stop somewhere.


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