Legal Question.

[BlancoNino]

Let's say that Paramount Et Al (a mixture of studios that make 64% of all movies) and Regal/AMC theatres had a meeting. No notes were kept, and the people representing them said no conclusion was reached for whatever reason they were meeting.

A year later, a trend starts. Release fees for Regal/AMC theatres for films from Paramount Et Al are around 250k, and fees for non-Regal/AMC theatres are over a million.

Also, fees for Regal/AMC theatres for NON Paramount et releases are much much higher.

Are Paramount and Regal in violation of both the Clayton Act and Sherman Anti-Trust act?

I'm going to say no, because Paramount Et Al. doesn't make 100% of movies.

Help?

 

[JS80]

Eye of the beholder really...you can consider both parties to be oligopolies. Plus the price discrimination doesn't help their cause; in fact it helps the case that they are "monopolies" because they engage in monopolistic behavior.

FYI Microsoft doesn't hold 100% of the market yet they were found to be a monopoly by the courts.

 

[BlancoNino]

But could this also work the same as like Pepsi or Coke having contracts with certain restaurants?

Regal/AMC theatres still have to pay much more for non Paramount Et films.

 

[BlancoNino]

Basically the question is whether or not this is price discrimination.

 

[Cerebus451]

I don't think the Coke/Pepsi analogy is right here. In those cases, they are offering price breaks in favor of exlusive pouring rights (we'll sell you the coke cheaper if you promise not to serve Pepsi). The scenario you detailed is more of a price fixing scheme similar to the case RAMBUS won against Infinion, et.al.. RAMBUS proved that the DDR RAM manufacturers colluded to artifically lower the price of DDR RAM on the market in order to prices RAMBUS RAM out of the marketplace. In your case, Paramount, et.al. are trying to price the competition (other movie makers) out of the marketplace by agreeing to artifically lower their prices. Not sure if offering the discount to only certain theater chains would change the case law or not, but then again I'm not a lawyer.