Buying group challenges Weinstein-B'buster deal
By Susanne Ault -- Video Business,12/11/2006
DEC. 11 | The National Entertainment Buying Group and two indie retailers filed suit in Massachusetts Superior Court today to block The Weinstein Co. and Genius Products from identifying its DVDs as not appropriate for rental from any retailer but Blockbuster.
TWC officials last month touted a deal to make Blockbuster its “exclusive” retail partner in the rental channel, as part of a broad marketing and copy-depth deal between the studio and retailer.
In comments surrounding the deal, Genius CEO Trevor Drinkwater said the companies understood that under the First Sale Doctrine, they would not be able to prevent other rental stores from buying TWC discs at retail and using them as rental inventory. He said TWC and Genius would, however, include on sell-through copies some sort of message to consumers that the discs were intended for sale only and should not be rented.
“With the First Sale Doctrine, there’s nothing we can do to prohibit someone from walking into Costco and buying the DVD and renting it,” Drinkwater told VB. “What we can do as a distributor is brand all Blockbuster DVDs with the Blockbuster logo, and all the DVDs that are out for sale will be clear to consumers as being for sale only. We’ll encourage people to call us if they did rent [a DVD that is labeled for sale].”
NEBG, which claims 300 members, and indie retailers Nolan Anaya of Captain Video, Amherst, Mass., and Todd Zaganiacz of Video Zone, South Deerfield, Mass., claim in the suit that such labeling would flout the First Sale Doctrine. They are charging TWC and Genius with unfair competition, unfair or deceptive acts and practices, untrue and misleading advertisements, negligent misrepresentation and tortuous interference with advantageous business relations.
The plaintiffs are seeking an injunction to prevent both the distribution of products and any notice “that would imply or tend to imply that retailers other than Blockbuster who rent the defendants’ DVDs to the public are engaged in wrongdoing.”
“It becomes defamation of character,” said Zaganiacz, NEBG president and owner of Massachusetts’ Video Zone. “It’s telling our customers that we are doing something wrong, when in actuality, we are not. Under the First Sale Doctrine, we have the right to purchase and then rent out that product.”
Genius Products had no immediate comment. TWC declined to comment on pending litigation.
Post a comment Return to article View other article discussions
| Submitted by: | Andrew katz (fivestarvideo2001@yahoo.com) 12/11/2006 3:12:00 PM PT |
| Location: | Berkeley, CA |
| Occupation: | Independent Video Store owner (one of the last, I fear) |
Other than the legal implications of this deal between Blockbuster &
Weinstein, we all have to realize that the titles are available for us to rent,
if we purchase them through other retailers such as Walmart or Costco. I
for one, will penalize Weinstein well into the future for this action by
purchasing the minimum quantities. It really shouldnt be too hard as the
titles in question such as "School for Scoundrels" is such a dog, that
maybe it's best that Blockbuster be forced into buying lots. It will quicken
their eventual demise.
| Submitted by: | Jerry Briggs (jerry@psci.net) 12/11/2006 2:44:36 PM PT |
(I wrote earlier, but it disappeared! Ignore this if you alredy got it)(also...I am color blind, so I hope the color is indeed black, and not a dark brown..the one...in your box to make sure you aren''''t innundated with talking-points from organizations)
Regarding the Weinstein-Genius arrangement with Blockbuster. The verdict is in: they win! Video Buying Group and two Independent Retailers lose.
However, this is a positive move for them (Genius and TWC) to defend, as it will garner them attention they normally would not have had for "B" and "C" titles.
An agreement with Blockbuster by it''''s nature, guarantees a certain amount of product per title for this exclusivity. This will distribute far more copies than would be earned by appealing to us indies to try their direct-to-DVD "features".
Blockbuster gains by being the only game in town: TWC & Genius gain by getting guaranteed returns on their investments in cheapie productions.
I am not in favor nor against this, and I am an independent retailer. It will get attention for the first few titles, and then apathy will have set in.
Retailers who are upset by this "slap in the face" as they perceive it, will probably remember the whole thing as they place orders or titles that are offered to them...titles with some real importance in the rental market. Perhaps this is where Genius Head Drinkwater reports his failures to his Board of Directors...
Meantime, Genius and the Weinstein Company will prevail...they win the battle. It remains to be seen if they win the war with their "genius" tactics.
This is an always-interesting business, isn''''t it?
Jerry Briggs
Post a comment Return to article View other article discussions
