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Judge Denies Class Certification In FAIR Case

10 Jan, 2002 By: Joan Villa

A California judge has denied class certification to a group of independent retailers charging seven studios and Blockbuster with price fixing and price discrimination.

In a 26-page ruling, Judge Victoria Chaney determined that the 200 plaintiff retailers who filed the antitrust charges in Los Angeles Superior Court must prove harm and damages on a case-by-case basis.

"She thinks the predominant claim is price discrimination and the predominant measure of damages is individual and that's the controlling factor," explains plaintiff attorney Jim Moriarty, who says plaintiffs are deciding whether to appeal the decision. "It's not a fatal ruling to us but it does complicate the case."

Blockbuster executive v.p. and general counsel Edward Stead says the legal victory "is also a victory for consumers" because copy depth allows more consumer choice and free competition.

"We're pleased that this ruling comes to the same conclusion that a federal court in Texas reached in March of last year—that class certification is not appropriate in the cases brought by the independent video retailers," Stead says.

However, Moriarty plans to proceed with both price fixing and price discrimination charges by grouping five to 10 similarly situated retailers into individual legal actions around the country. He says he agrees that copy depth benefits the consumer but believes Blockbuster's revenue-sharing contracts with studios are exclusive and illegal. That issue will be determined in a concurrent case in San Antonio, set for trial March 13, he adds.

"What is irritating about this case is that Blockbuster and the studios are continually misrepresenting the idea that revenue-sharing and copy depth are available to everybody," he says. "Blockbuster's share of the market went from 24 percent to 40 percent based on copy depth and had everybody had access to copy depth, that could not have happened."

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