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Redbox, Disney Lawsuit: Redbox Claims Disney Stifling Competition

Posted by: , 14:12 AEDT, Sat February 3, 2018

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Redbox fights back against Disney with a lawsuit of its own, claiming Disney is stifling competition
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Image/Photo Credit: Gabriela Pinto @ Flickr, CC

Following Disney's lawsuit against kiosk rental firm Redbox over claims of unauthorized resale of digital copy codes, Redbox has hit back with a lawsuit of its own claiming Disney has gone out of its way to harm Redbox's business in an attempt to stifle competition.

According to Redbox, Disney has been against the company's business model from the get-go. The studio has tried to prevent Redbox from renting out its titles until at least 28 days after the title's original release, terms that Redbox has been unwilling to accept. Instead, Redbox sought retail copies of Disney titles to use in its vending machines, specifically purchasing "combo" packs (that include the Blu-ray, DVD and Digital copies of the movie), which the company identified as the best way to minimize costs.

Disney has also criticized Redbox's pricing model in the past, feeling that it is too low and will harm the studio's long term profits. Most of the other studios have got on-board with Redbox.

It's Redbox's unwillingness to work on Disney's terms and the way it has found a workaround that has made Disney takes actions that, according to Redbox, "stifle competition and eliminate low-cost options" for consumers.

Redbox claims that Disney put pressure on distributors and retailers to not sell titles to Redbox, even punishing one distributor found to have been doing business with the rental kiosk company.

"Defendants' actions are harming Redbox's lawful sales of Disney digital movies," Redbox's lawsuit claims. "And the impact of that harm is not limited to the reduced revenue from those lost sales. Redbox's entry into the digital market is being harmed as well. Because Disney is impeding Redbox's ability to sell Redbox's lawfully acquired Disney digital movies, consumers are being dissuaded from looking to Redbox as a source of titles that are in high demand."

Redbox further argues that Disney are only attempting to artificially inflate prices that consumers pay for their content, and that the studio is hurting Redbox in order to promote its own direct-to-consumer offering.

[via Deadline]


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