NEW YORK -- A federal judge in New York ordered an end to the MPAA ban on awards screeners Friday, capping what has been a contentious battle between the major studios' specialty film divisions and the studios' trade organization.

Ruling that the ban runs afoul of antitrust laws, U.S. District Chief Judge Michael Mukasey granted a preliminary injunction that effectively lifts the ban.

According to Simon Barksy, MPAA co-chief operating officer, executive vp and general counsel, the MPAA plans to appeal the decision to the 2nd U.S. Circuit Court of Appeals, a process that could take at least two weeks.

"From Day 1, the screener policy has been about one thing: preserving the future of our industry for filmmakers of all sizes by curtailing piracy. We know, without dispute, that in the past, screeners have been sources for pirated goods both domestically and overseas. We will appeal because the impact and growing threat of piracy is real and must be addressed wherever it appears," MPAA head Jack Valenti said in a statement.

The judge's ruling followed an evidentiary hearing Wednesday in which a coalition of indie film producers presented their case against the MPAA, the object of their multimillion-dollar antitrust suit.

Mukasey found that the testimony offered by the defendants in the case -- whose witnesses included Valenti, Warner Independent Pictures head Mark Gill and a senior vp within the MPAA's antipiracy unit -- corroborated the plaintiffs' assertions that the ban would hurt the indie film business and is considered conspiracy under the law.

Valenti had testified that the ban had been implemented to combat piracy, which he called "a malignant fungus on the face of the industry." But Mukasey said the MPAA's concern over piracy did not outweigh the harm that the ban caused independent filmmakers. "The plaintiffs will likely suffer irreparable harm because of the MPAA's screener ban," the judge said. The judge called Valenti's metaphors a "forceful if not cogent analysis."

Citing Valenti's testimony, Mukasey observed that the ban prohibited the studios from competing against each other during awards season. Instead, he said, the studios should have been allowed to make their own policies individually on a film-by-film basis.

"(Those are) business decisions that should be left to the discrimination of each member," the judge said. "Mr. Valenti testified that neither the MPAA nor its members were content to leave the decision (whether to send our screeners) to its member studios."

Mukasey further pointed to Gill's testimony -- in which the former Miramax executive said: "A huge part of (an indie film's success) is getting critics to review smaller films" -- before arriving at the conclusion that the ban would keep indie films out of critics' hands, resulting in less media coverage for the films and ultimately less business. Mukasey further ruled that the decreased exposure for indie films would lead to their being less available in the marketplace, ultimately adding a burden of cost and inconvenience on the consumer seeking out such entertainment.

The judge said the MPAA did not provide the court with persuasive evidence that awards screeners lead to piracy. He also questioned why the policy covered titles already available on commercial DVDs. "Once a film reaches the home video market, they are available in stores and can be pirated at will," the judge said.

Mukasey cited yet another excerpt from Valenti's testimony, in which the MPAA boss described his role as the "voice and the conscience of the (MPAA's) member companies." Turning that statement on its head, Mukasey said Valenti "fulfilled one of the conscience's functions in this case, by getting people to behave other than they would otherwise."

However, Mukasey added that the case did not go so far as to "impose an unreasonable restriction in trade."

In making his ruling, the judge based much of his reasoning on the evidence offered by "American Splendor" producer Ted Hope and a declaration by Miramax Films co-chairman Harvey Weinstein.

Hope testified that "the success of an individual (indie) film depends on (its) critical success and word-of-mouth," and that the screener ban would hurt his "standing in the industry." Hope said the ban's repercussions would "greatly reduce" his ability to get first-look deals and attract talent to projects, causing his career to "suffer grave risk."

Weinstein asserted in a written declaration that screeners could ultimately make the difference between a film grossing $5 million and $20 million, due to the amount of exposure indie movies can get through reviews and awards. Mukasey also pointed to Weinstein's testimony in which the Miramax exec asserted that even if screeners do not result in a film winning awards, they are still of value because they may assist a film getting on critics' lists and earning nominations.

Mukasey rejected the plaintiffs' assertion that the ban was hatched by the MPAA to keep indie movies out of the awards race, dismissing that notion as a "paranoid fantasy."

Initially, when Mukasey read his ruling at 10 a.m. Friday, he issued a temporary restraining order on behalf of the plaintiffs. But the defendants then requested that he instead grant a more-encompassing preliminary injunction since a preliminary injunction is more subject to an appeal. The judge granted that request.

Ultimately, the suit could move to a trial phase that could take anywhere from months to more than a year, according to the plaintiffs' attorney, Frederick Juckniess.

"I'm glad the court recognized the detrimental effect such (a ban) would have on independent filmmakers. Indie filmmakers could have been seriously hurt by this action," Hope told reporters after the hearing. He added that the plaintiffs would like to enter into a discussion with Valenti on how to better combat piracy. "I expect those discussion will take place," he said. "We can (tackle) the issue of piracy together."


Read the judge's ruling (PDF courtesy FindLaw)