Courtroom Debate Begins in Indies v. MPAA Case; Hearing and Decision Set for Dec. 3
by Eugene Hernandez
On Wednesday, Chief Federal Judge Michael B. Mukasey of the U.S. District Court in the Southern District of New York heard initial arguments in the screener ban case brought against the Motion Picture Association of America (MPAA) by a coalition of independent film producers and two chapters of the Independent Feature Project (IFP). After about an hour of initial testimony from both sides on Wednesday, the judge set Wednesday December 3 as a date for an evidentiary hearing on the matter of a temporary restraining order (TRO) to prevent the MPAA from enforcing its ban on awards screeners. He indicated that he will rule on the TRO at that time.
The independent producers and the IFP chapters are opposed to the recent decision by the MPAA and the Academy of Motion Picture Arts and Sciences (AMPAS) that limits the distribution of screener tapes to Academy members only and they want to be able to send tapes to members of the guilds and critics groups that present annual awards. While the MPAA is saying that economic concerns related to piracy are at the heart of the screener ban, the independent producers are citing anti-trust and their own economic issues in charging that the ban is harmful.
The hearing on Wednesday morning in lower Manhattan was held on the 21st Floor in the modern Daniel Patrick Moynihan U.S. Courthouse on Pearl Street. Parties gathered in the courtroom included Greg Curtner of Miller, Canfield, Paddock & Stone, representing the group of independent producers and the IFP chapters. Producers Joana Vicente & Jason Kliot from Open City, Jeff Levy-Hinte of Antidote, Ted Hope from This Is That, Susan Stover from HeadQuarters, John Sloss from InDigEnt, and Michelle Byrd from IFP/New York were among the plaintiffs that sat in the audience. A large team of attorneys were on hand to represent the defendant, the MPAA, with primary arguments made by Richard Cooper, a partner at Williams & Connolly in Washington, DC. He is noted for his antitrust work, among other cases.
In part of his statements on Wednesday, MPAA attorney Cooper argued that the MPAA is not responsible for the screener ban. "This is not a rule that the MPAA imposes or enforces," he told Judge Mukasey. "[This is] not a matter that the MPAA controls." He added, "The MPAA has no control over the studios, it is a mere mouthpiece." In another wording he told the judge, "This is not a regulatory body. [Jack Valenti] is a messenger, he is not the decision maker."
"Well, if that's the case, your client has no objection to withdrawing this [ban]," added Judge Mukasey.
Independent producers' attorney Greg Curtner countered to the judge, "The first time that anyone has said that the MPAA is not a governing body was this morning in the courtroom.
Counsel for the MPAA also argued that they were not given enough time to prepare for Wednesday's hearing on the TRO. Attorney Cooper told the judge that as late as last week he could not get a confirmation from the independent producers on their plans for the suit, nor could he get information about which court they would file in. Judge Mukasey seemed sympathetic on that point. MPAA counsel later told reporters that they had recently been tipped off to a pending suit.
"You delayed and you sat on your rights," Judge Mukasey told independent producers attorney Greg Curtner during the hearing. In deciding not to allow an immediate TRO, Mukasey added, "You waited a good month [to file this lawsuit]. You should have done that in September. And I don't think [the MPAA] should be penalized for it
Curtner argued that after the ban was announced on September 30, the independent producers had been fighting the ban for a number of weeks and since the relaxing of the ban for Academy members on October 23, his clients in the film community met with Valenti to seek a resolution. Rumors of a lawsuit began floating around the film community as early as mid-October. Valenti met with Michelle Byrd of IFP/New York and Dawn Hudson of IFP/Los Angeles on November 6, took their views to the Hollywood studio chiefs and on November 14 announced that the revised ban would stand as is. The lawsuit was filed 10 days later.
Curtner, lead attorney for the coalition from the independent film community, told indieWIRE after the hearing, "We went as fast as we could." Admitting that he had hoped for "immediate relief" from the ban, Curtner added that he was encouraged by Wednesday's court appearance.
In a statement released later in the day he added, "We want everyone to be free to decide on a film by film basis whether to use screeners to promote their films and we want to restore the free market that existed in prior years.
Plaintiffs surveyed following Wednesday's hearing seemed optimistic about the fact that Judge Mukasey set a hearing for Wednesday. Indeed, the Judge could have simply thrown out the request for a TRO. On Wednesday afternoon, the defendant provided indieWIRE with a copy of its own paperwork opposing the motion for a TRO. It is the same paperwork presented to the Judge in court. A revised version will be given to the court on Tuesday.
In the introduction to the 29-page document, the MPAA reinforce that the case is about piracy that threatens that industry, and states, "It is not about limiting competition; it is about concerned men and women fighting to] preserve a business environment that will continue to foster the creation of films both large and small for the enjoyment of others."
Continuing, the document reads, "Vigorous competition for awards, including competition by independently-produced, studio-distributed films, is continuing even during the pendency of this case. The sending out of many thousand additional screeners -- at the risk of increased piracy -- sought by the Plaintiffs is not necessary to that competition."
The document also notes that the current screener ban does not apply to independent distributors. It adds, "The films for which any Studio declines to send out screeners to awards groups other than the Academy are films as to which it owns the U.S. distribution rights." Continuing it says, "Studios are conducting awards campaigns for some independently produced films, and could save the cost of doing so by not buying the rights to such films in the first place." The document, which is listed as being from MPAA counsel Barsky, Jonathan Zavin of Loeb & Loeb, and Jeffrey Rosen of Sargoy Stein Rosen & Shapiro, also discusses a number of other points, including statements that the harm to independent films is "speculative and exaggerated" and that the plaintiffs have "sued the wrong party."
While Wednesday morning's hearing brought the MPAA and a group of independent producers into the same room before a judge, the most heated exchanges on the matter came after Judge Mukasey set the date for the evidentiary hearing and left the court. In front of a group of reporters from Associated Press, Reuters, LA Times, Bloomberg, Variety, the Hollywood Reporter, indieWIRE and other publications, producer Jeff Levy-Hinte ("Thirteen") and MPAA Co-COO, EVP, and general counsel Simon Barsky debated numerous points as their respective colleagues watched.
Detailing issues of piracy in the entertainment industry that he says are the heart of the MPAA's opposition to screeners, Barsky asked, "Why would a studio want to harm those titles when it's their bottom line? They have an economic self-interest." Continuing he added, "What we are looking for is not sending out more [screeners], there is a greater risk of piracy." He added that with increased piracy the film business, like the music business, will face layoffs and economic devastation.
"We are losing our jobs because of your ban," Levy-Hinte shot back, arguing that the ban is bad for the specialty film business because it hurts small films whose investors rely on awards as one way to recoup their money. "You are killing independent films," Levy-Hinte charged.
All eyes will be on the list of witnesses called to testify at Wednesday's evidentiary hearing. One of the plaintiffs told indieWIRE that head of the studio specialty divisions will be called to testify at the hearing.
One plaintiff said that a specialty division head had been called for testimony today, but that fearing retribution from his corporate parent, his lawyer asked that he not appear. The plaintiffs maintain that they will seek to compel specialty chiefs to appear on December 3.
Plaintiffs were also buzzing Friday about comments made by Miramax head Harvey Weinstein in an interview broadcast on NPR's "Morning Edition" on November 25. In the segment, Weinstein discusses the idea of studio specialty divisions sending out screeners in opposition to the current ban.
"For Miramax, I think we can do what we want," Weinstein told NPR. "I mean, there is always the case of Michael Eisner firing us but that might be a cause for celebration you know what I mean, in all quarters, ours included."