While they may have a lock on the world of online video streaming and by mail renting, Netflix has just found their first real set back, albeit a seemingly minor one.
According to Home Media Magazine, a federal judge has granted class-action status to a collection of Netflix subscribers who recently sued the company, along with Walmart, for ‘alleged antitrust issues.’
The suit claims that Netflix and Walmart.com colluded to control the home video market when Walmart.com left the online renting world back in May of 2005. In turn, Netflix agreed to not begin selling DVDs, with both promoting each other’s respective brands online.
Apparently, Walmart has already reached a $40 million agreement with the plaintiffs, something that Netflix has yet to do. Netflix has gone as far as to say the case has ‘no merit,’ so expect this one to be battled out in court, with a trial slated to start in early 2012. I know, our judicial system apparently moves really slow.
Personally, I have to lean towards Netflix on this one. While the cross promotion does seem a tad bit odd, I don’t know if it’s grounds for a court case. That said, the situation does seem a bit weird on first glance, so at this point, it may be anyone’s game.
What do you think?