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Directors Guild Opposes Government’s Move to End Paramount Consent Decrees

The Directors Guild of America has announced it’s opposing the Justice Department’s efforts to terminate the Paramount consent decrees, calling those efforts “a step in the wrong direction.”

Makan Delrahim, the head of the department’s antitrust division, announced in a speech on Nov. 18 that he would take action to end the decrees, which he argued are antiquated and “no longer meet consumer interests.”

The decrees were the result of 10 years of antitrust litigation, which ended with a Supreme Court decision in the government’s favor in 1948, and required studios to divest themselves of their theatrical arms and prohibited certain anti-competitive practices in the distribution business.

“In this new Gilded Age, the Department of Justice’s recent move to end the Paramount Consent Decrees is a step in the wrong direction,” the DGA said. “While the motion picture and television industry has changed in the 70 years since the first Decree was signed, many of those changes – precipitated by new tech giant entrants – call for greater, not lesser, antitrust oversight.”

“To defend competition in the motion picture marketplace, the DOJ must combat predatory and monopolistic practices,” the guild also said. “Fair competition is especially imperative for both independent films and small and independent theaters. Most importantly, a fair and robust market ensures our members and other creators have the widest possible opportunities for work, and audiences who want to enjoy the experience of seeing a motion picture in a theater have access to the very best and most diverse content no matter where they live.”

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“The DGA will be monitoring this issue and will continue its fight for the fair market conditions that support a robust film, television, and new media marketplace,” the statement concluded.

The department announced in 2018 that it would revisit the Paramount decrees as part of a much broader initiative to sunset decades-old antitrust enforcement decrees. The National Association of Theatre Owners raised an objection last year, arguing that the prohibition on “block booking” remains essential to a thriving movie marketplace.

The decrees barred studios from packaging movies together under one license, effectively forcing theaters to take less popular films on a studio’s slate in order to get its blockbusters. NATO has argued that that rule is essential to allowing smaller movies from independent distributors to find a theatrical audience.

The Justice Department filed a motion in federal court on Nov. 22 to terminate the Paramount consent decrees.

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