- Intertainer, an online video-on-demand site, will shut down and lay off most of its remaining staff while pursuing a lawsuit against the major movie studios, its chief executive said on Thursday.
The Culver City, California-based company plans to close its movie-selling service on Oct. 23 and lay off 10 of its remaining 15 employees two days later, Intertainer CEO Job Taplin said.
Taplin said the company, which once employed 80 people, would maintain a skeleton staff and a Web presence “so that we can put (the service) back up when we have success with the lawsuit.”
Intertainer principals Taplin and Richard Baskin and Jeremiah Chechik started the company in 1996 with $120 million in investments from Comcast Corp., Intel Corp. , Microsoft Corp., NBC, Sony Corp. and Qwest Communications International Inc. .
NBC is currently owned by General Electric Co.
Intertainer was no longer accepting new users on Thursday, and had posted a message advising of the company’s federal anti-trust lawsuit, filed Sept. 24 against entertainment giants AOL Time Warner Inc., Sony Corp. and Vivendi Universal .
The lawsuit alleges that the movie studios conspired to fix prices for online movie distribution to drive Intertainer out of business and start their own online services.
The lawsuit asks a federal judge in Los Angeles to order the companies to stop their “anti-competitive conduct” and to divest themselves of any interest in their competing online movie venture, Movielink.