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Court Convenes to Set Ground Rules for Retailers' California Antitrust Suit Against Studios, Blockbuster

23 Jul, 2001 By: Joan Villa

LOS ANGELES — Fourteen attorneys filed into Superior Court today to establish rules and schedules that will govern the complicatedantitrust action brought by more than 200 retailers against seven filmstudios and Blockbuster Inc.

"This is the most significant antitrust case on file in the United States today," argued plaintiffs’ attorney Jim Moriarty of Houston-basedMoriarty & Leyendecker, against the practice of labeling documents "secret" and then sealing them from public view. "There will be great public interest in the so-called secrets of this case."

Judge Victoria Gerrard Chaney said she recognized the necessity of protecting "business plans that might come under the rubric of confidentiality," but noted she may also be constrained by confidentiality orders in a concurrent case in federal court filed in San Antonio, Texas, and by specific rules governing California.

"You have another case going on and I don’t want to run afoul of another order," she said. "I’m not going to make an administrative nightmare for myself or for Judge Prado in Texas."

Chaney also said she expects to set a trial date closer to the plaintiffs’ request of August 2002 than the defendants’ choice of June2003. She will set the date after she rules on class certification in late September or October, she said.

In separate responses submitted earlier this month, the studio defendants and Blockbuster disputed all charges including price-fixingand argued against class certification, saying market conditions and the independent retailer plaintiffs’ own actions since 1997 have hurt theirbusinesses, not a conspiracy or monopolistic activities.

Blockbuster’s terms were "cost-justified" and "reflected a functionaldiscount," according to Blockbuster’s response, while studios Warner Home Video, MGM Home Entertainment and Buena Vista Home Entertainmentasserted that Blockbuster’s discounts "were neither secret nor unearned" and were available to all customers purchasing on like terms.

Several studios also claimed that plaintiffs did not request the same pricing,or according to the Warner response, were "not capable" of dealing with Warner on terms "identical or substantially equivalent" and "do not wish to do so."

Lawyers for 20th Century Fox Home Entertainment argued its conduct was "undertaken to advance legitimate business interests" and "had theeffect of promoting and encouraging competition" — a claim other studios echoed.

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