Department of Justice Terminates Paramount Consent Decrees

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The US Department of Justice has ended the Paramount Consent Decrees Decrees set forth in the United States vs. Paramount Pictures case of 1948. This does not bode well for the future of movie theaters. Since the decrees were specifically created to prevent film studios from monopolizing the theatrical distribution process.

United States v. Paramount Pictures

Old Hollywood, while often glamorized, was a monopoly nightmare. The big studios controlled every stage of film production and film showcasing. Everything from the physical manufacturing of film to theatrical distribution. For several decades studios owned their own theater chains and could show only their own movies. This allowed complete monopoly and hurt independent cinema. This was until 1948 in the historic United States v. Paramount Pictures case, when the Supreme Court ruled that the situation was a monopoly and forcibly separated the studios from the theater chains. Making them into the separate entities that we still know them as today, these checks and balacnes are known as the Paramount Consent Decrees. With the Decrees it was illegal for a film studio like Universal or Disney to buy a theater chain like AMC. At least it was until today.

What Happened?

In November of 2019 the idea of ending the Paramount Consent Decrees was first brought forth by the Department of Justice. Claiming that the decrees had outlived their usefulness and this move would help to encourage a more competitive marketplace. Especially as entertainment corporations merge in bigger and bigger conglomerates with more and more control over the market. On Friday a federal judge in New York finally gave the green light to end the consents. In a 17 page statement the judge defend ending the decreees as good for business interests. Even outlining that removing the decrees would make formally illegal pratices fully legal. Such as, setting minimum ticket prices, bundling multiple films to theaters, and selling films to entire chains instead of individuals theaters.

Ramifications of Ending the Paramount Consent Decrees

This change could not come at a worse time. The ongoing pandemic has already severely the infrastructure of the theater chains. Now the Department of Justice has given the media conglomerates the power to exert greater control over or even buy theater chains. This is potentially disastrous at a time when the studios and the theater chains are already in conflict over streaming vs. theatrical releases. The studios, who already have the upper hand in this conflict, have been given even more power. This move also spells disaster for independent theaters, films and filmmakers. Securing the release of a larger studio has now become even more important then ever before as studios have the power to muscle out any competition.

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