Blockbuster tries to stymie Netflix

Blockbuster, North America's largest video rental chain, today said it has filed antitrust counterclaims in a San Francisco federal lawsuit brought by Netflix Inc., an online DVD rental company.

Netflix had sued in a bid to shut down Blockbuster's online rental service. But Dallas-based Blockbuster said the lawsuit is based on unenforceable patents that it obtained deceptively, in a bid to monopolise online rentals.

Netflix accused Blockbuster in its April lawsuit of starting its online service in 2004 despite knowing that the service infringed a Netflix patent, and that Netflix was seeking a second, related patent.

Netflix, based in Los Gatos, California, said its business methodology calls for subscribers to pay monthly fees to select and rent DVDs from its website, and to tell Netflix in which order to ship films.

Marshall Grossman, a Blockbuster lawyer, said "there is nothing original about renting movies or subscription rental programmes." He likened Netflix's patent claims to "a fast-food restaurant trying to patent selling hamburgers through a drive-through window."

- REUTERS