Walmart, Netflix Class-action Lawsuit Settlement Pending

16 Nov, 2011 By: Erik Gruenwedel

---

Judge to review proposed $27.5 million settlement with Walmart, while Netflix remains in litigation

Netflix consumers who rented DVDs from May 19, 2005, through Sept. 2, 2011, are eligible to be included in a proposed settlement of a class-action lawsuit filed against Walmart and Netflix.

Consumers who fit the legal requirements have until Feb. 12, 2012, to file a claim at () and be eligible to receive a Walmart gift certificate for an undisclosed amount.

Walmart, without admitting liability or guilt, agreed to settle during the summer to avoid further litigation. Netflix, which failed to decertify the class-action status in a March ruling, has chosen to litigate the matter further in a court trial next year — the outcome is not deemed to affect the current settlement, according to the case website.

On Jan. 9, 2009, lead plaintiff Andrea Resnick filed a suit against Walmart and Netflix in U.S. District Court in Oakland, Calif., alleging that the retail behemoth and Netflix in 2005 entered into an illegal “market allocation” agreement whereby Walmart agreed to exit the by-mail DVD rental business (forwarding its subscriber list to Netflix) and Netflix agreed not to sell new-release DVDs.

With about 65 similar complaints filed, the case was given class-action status.

The alleged pact between Netflix and Walmart occurred at a time when DVD sellthrough of new-release movies and TV DVDs dominated home entertainment — driven by Walmart and upstart Walmart.com. The plaintiffs alleged that due to this pact, Netflix was able to charge more for its dominant disc rental service (streaming did not launch until 2008) than it would have without the agreement, according to the complaint.

Blockbuster’s by-mail platform, Total Access, didn’t launch until Nov. 2, 2006 — with Jessica Simpson as its official second subscriber behind CEO John Antioco. Hollywood Video and Movie Gallery did not have by-mail subscription services.

Bookmark it: