U.S. senators voice opposition to movie futures contracts
The odds could be shifting in Hollywood's favor after a group of senators have urged federal regulators to halt plans to give final approval to a new market that would trade movie futures contracts.
In a letter today, Sen. Dianne Feinstein (D-Calif.) and four of her colleagues called on Gary Gensler, chairman of the Commodity Futures Trading Commission, to hold off making a final determination about the legality and benefit of movie futures trading given the current debate in Congress over financial reform legislation.
"We are also concerned that this new derivative product may not serve a public purpose, and we encourage the Commission to seriously consider this question before approving these contracts," the senators wrote, citing the widespread opposition to the plans in Hollywood. In addition to Feinstein, the letter was signed by Barbara Boxer (D-Calif.), George LeMieux (R-Fla.), Al Franken (D-Minn.) and Jeanne Shaheen (D-N.H.).
Movie studios, joined by theater owners and the Directors Guild of America, have waged a campaign in recent weeks to fight the proposed exchange, saying it would be vulnerable to manipulation and create bad publicity for films before they hit theaters.
The announcement comes a day after a Senate committee, as part of a financial reform package, voted to ban proposed exchanges that would allow the movie industry and investors to place bets on movie ticket sales, delivering a big blow to two trading firms seeking to create the exchanges.
-- Richard Verrier