updated 02:55 pm EDT, Thu March 22, 2007
Starz Sues Disney
Cable TV network Starz Entertainment said on Thursday that it was suing the Walt Disney Company, accusing the latter of violating an exclusivity agreement by offering its movies through online stores such as Apple's iTunes Store and Wal-Mart's Video Downloads service. Filed in Los Angeles, the suit alleges that Disney broke a 2005 deal which gave Starz sole rights to Disney movies for an unpublicized amount of time on both its TV channel and its Vongo online store.
The suit could be especially damaging for Apple, whose close connection to Disney helped launch the initial catalog of iTunes movie downloads in September of last year with a swath of exclusives such as the Pirate of the Caribbean series. Apple CEO Steve Jobs currently sits on Disney's board of directors and holds the largest individual stake in the movie studio's shares.
Nevertheless, Starz has referred to its own loyalty as a motivating factor behind the suit. The entertainment channel, which is owned by Liberty Media Holding Corporation, has invested over $1 billion in securing the rights to Disney films since 1993 and believes that distribution to Apple and Wal-Mart was a particularly severe breach of trust.
No details are available concerning the financial compensation sought by Starz in the lawsuit.