Redbox Now Suing Warner Bros., Fox and Universal

Redbox, which rents DVDs for a dollar a night from thousands of kiosks placed in retail stores, has now filed suit against Warner Bros., having previously done so against 20th Century Fox and Universal. In all three cases, the studios are prohibiting wholesalers from supplying DVDs to Redbox for at least four weeks after their release. In any event, the kiosk operator can still obtain these studios' newly released DVDs from other sources, but at generally higher costs. As of now, Redbox can continue to use normal wholesale distribution channels to obtain DVDs from Sony, Lionsgate, Disney and Paramount. The reason that WB, Fox and Universal took action against Redbox was their assessment that the kiosk operator's low rental prices were cutting too much into their revenues from DVD sales, while Redbox's lawsuits contend that the three studios' behavior constitutes restraint of trade.