Blockbuster, Netflix settle patent dispute

DALLAS Blockbuster disclosed in an SEC filing today that on June 25 Blockbuster and Netflix resolved the parties’ pending patent litigation. While the terms of the settlement are confidential, the parties have agreed to secure dismissal of all claims in the litigation. According to Blockbuster, the settlement will have no material effect on the company's future financial performance.

Last year Netflix and Blockbuster entered into a patent dispute, in which Netflix claimed Blockbuster owed the company royalties for its entry into the online DVD market. Blockbuster countersued, claiming Netflix was in violation of antitrust legislation and that its patents were too broad.

Blockbuster recently announced that it would offer new lower-priced Blockbuster By Mail subscription plans that starting at $4.99 a month to all current and new subscribers to Blockbuster's online rental service. Included is the company's most popular three-out unlimited movie plan which will now be offered at $16.99 for Blockbuster By Mail subscribers.