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Weinstein's 800 Number on Blockbuster Exclusives is Temporarily Halted

9 Jan, 2007 By: Jessica Wolf

A Massachusetts federal court battle has temporarily halted The Weinstein Company's plans to include a 1-800 number in the company's rental titles that are being provided exclusively to Blockbuster Inc., pending a case filed by independent retailers.

A court date of Jan. 18 has been set to hear the lawsuit against The Weinstein Company. The charges include potential defamation of character, loss of business to competing rental dealers and misleading advertising for Blockbuster's inclusion of a message on its rental titles asking consumers who have rented those titles from any retailer other than Blockbuster to call a toll-free number and report them.

District Court Judge Michael Ponsor said Jan. 5 that he was prepared to issue a temporary restraining order that plaintiffs were requesting unless defense counsel could assure the court there would be no DVDs hitting the streets with the “call this toll-free number” message until after the Jan. 18 hearing, according to plaintiffs.

The defendants' attorney then said that The Weinstein Company and its distributor Genius Products Inc. will not release DVDs with any such message on them or in them.

National Entertainment Buying Group (NEBG) president Todd Zaganiacz and fellow Boston-area independent retailer and NEBG VP Nolan Anaya filed the suit last month in Massachusetts district court.

The NEBG represents 300 independent video rental dealers across the country. The group's leaders, in filing the suit, claim that the Weinstein's proposed labeling “by implying illegal activity defames and damages the businesses of other retailers and will cause the financial loss and irreparable harm.”

The claim cites The Weinstein Co. on five counts: unfair competition, unfair or deceptive acts and practices, untrue and misleading advertisements, negligent misrepresentation and tortious interference with advantageous business relations.

The suit has since been moved to federal courts in the state.

Two Weinstein titles under the Blockbuster exclusive are slated to street this week, The Protector and Seven Swords, so the temporary halt to Weinstein's stated plans to include a 1-800 number on the releases is a small victory to Blockbuster competitors, Zaganiacz said.

There's still a lot up in the air, he said. No one knows the language the supplier intends to use on the exclusive releases, or what operators at the 1-800 number will tell consumers who call after having seen it.

But there's a good chance consumers will get the impression that retailers other than Blockbuster that are renting the exclusive titles are breaking the law, which is just not the case under the First Sale Doctrine, Zaganiacz said.

The First Sale Doctrine states “the distribution rights of a copyright holder end on that particular copy once the copy is sold.” So if retailers buy the titles, which are readily available for sellthrough, and then decide to rent them, no law is broken.

The Weinstein Co. and its distributor Genius Products declined to comment on either the lawsuit or any plans for the proposed 1-800 number on Blockbuster exclusive titles.

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