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Fox Out, Universal and Columbia Tristar In

11 Jun, 2002 By: Joan Villa

On the eve of trial in an antitrust lawsuit brought by independent video retailers, Judge Edward Prado has denied motions for reconsideration of partial summary judgment that would have dismissed some antitrust claims against Universal Studios Home Video and Columbia TriStar Home Entertainment.

Both studios asked the U.S. District Court in San Antonio, Texas, to dismiss Robinson-Patman antitrust allegations on the grounds that they entered into pricing agreements with Blockbuster to “meet competition.” In a May 17 order, Judge Prado granted the same request by 20th Century Fox Home Entertainment, noting it was the last studio to enter into revenue-sharing agreements with Blockbuster.

However, in an order signed June 6, Judge Prado denied the separate motions by Universal and Columbia, determining in both cases that the studios failed to “show the existence of sufficient facts that would lead a reasonable and prudent person to believe that the granting of a lower price would in fact meet the lower price of a competitor.”

The court further noted “a reasonable person would not believe that Universal slashed its prices for new release videos for Blockbuster simply because it knew that Blockbuster was negotiating with other studios for revenue-sharing deals and because it was ‘afraid' that Blockbuster would buy less of its product if Universal did not enter into an agreement with Blockbuster.”

In a similarly worded one-page order, Judge Prado countered Columbia's motion by noting “a reasonable person” – the legal standard applied in such matters – would not believe Columbia lowered prices “simply because” Warner Home Video and Buena Vista Home Entertainment were revenue-sharing with Blockbuster.

Jury selection and opening arguments in the case are scheduled to begin tomorrow.

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