Directors Guild Calls Paramount Decree Repeal ‘A Step in the Wrong Direction’

DGA calls for greater oversight of Hollywood media companies

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The Directors Guild of America on Monday announced its opposition to the decision by the Department of Justice’s antitrust division to repeal the Paramount consent decrees, which required Hollywood studios to eliminate block booking and release their ownership of tmovie heater chains back in 1948.

“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’s statement read. “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. 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.”

The statement concluded, “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.”

Late last month, the Justice Department filed a motion in federal court in the Southern District of New York to terminate the decrees, along with proposing a two-year sunset period on the practices commonly known as block booking and circuit dealing. The ruling effectively ended the decades of Old Hollywood antitrust rules that prevented movie studios from owning a significant number of movie theaters and banned movie-ticket price fixing and practices that would force movie theaters to purchase movies in bulk packages.

Makan Delrahim, the assistant attorney general of the Justice Department’s antitrust division, cited the rise of streaming technology and the advent of services like MoviePass as examples of how the movie industry has changed dramatically since the ’40s and why the decrees were no longer necessary.

“The Paramount decrees long ago ended the horizontal conspiracy among movie companies in the 1930s and ’40s and undid the effects of that conspiracy on the marketplace,” assistant attorney general Makan Delrahim of the Justice Department’s antitrust division said in a statement. “The Division has concluded that these decrees have served their purpose, and their continued existence may actually harm American consumers by standing in the way of innovative business models for the exhibition of America’s great creative films.”

However, following a public comment period in 2018, several organizations like the Writers Guild of America, West and the National Association of Theater Owners joined the DGA in voicing their disapproval for the repeal or relaxing of the decrees.

“If exhibitors were forced to book out the vast majority of their screens on major studio films for most of the year, this would leave little to no room for important films from smaller studios,” NATO argued in its public comments.