# United States v. Paramount Pictures (1948) **Argued:** February 9–11, 1948 · **Decided:** May 3, 1948 · **7–1, Justice William O. Douglas** · 334 U.S. 131 The case that broke the studio system, held the American film industry's structure in place for 72 years, and was quietly terminated in 2020. ## The defendants The **Big Five** — Paramount, Loew's (MGM), RKO, Warner Bros., and Twentieth Century-Fox — were vertically integrated across production, distribution, **and theater ownership**. The **Little Three** — Columbia, Universal, and United Artists — produced and distributed without significant theater chains. Together they controlled first-run exhibition in every major city. ## What was held illegal **Block booking**, which Douglas defined as "the practice of licensing, or offering for license, one feature or group of features on condition that the exhibitor will also license another feature or group of features released by the distributors during a given period." An independent theater wanting the year's prestige picture had to take the studio's whole slate unseen. The Court treated it as a tie: "the result is to add to the monopoly of the copyright." Also condemned: **circuit dealing**, fixing minimum admission prices, unreasonable clearances between runs, and discriminatory licensing. On theater divestiture the Court set aside the district court's findings and remanded for "an entirely fresh start on the whole of the problem" — which produced consent decrees, studio by studio, from RKO in November 1948 through Loew's in February 1952, forcing the integrated majors to separate exhibition from production and distribution. ## Why it matters twice For fifty years the Paramount decrees were the standard example of **structural relief that actually worked**. Divorcement ended the studio contract system, opened screens to independent and foreign film, and is credited with everything from film noir's economics to the arthouse circuit. Then on **August 7, 2020**, Judge Analisa Torres granted the Trump-era [[Antitrust Division]]'s motion to terminate the decrees, finding that "both the market structure and distribution system that facilitated that collusion are no longer the same," with a two-year sunset on the block-booking and circuit-dealing bans. The termination arrived at the precise moment streaming platforms were rebuilding vertical integration in a form the 1948 decree did not contemplate — a studio that produces, distributes, and owns the pipe to the viewer. The pattern is the one this vault's antitrust timeline keeps finding: a remedy is dismantled on the ground that the industry has changed, without asking whether the remedy is the reason it changed. Compare the [[AT&T Breakup]], whose seven successors reconsolidated into two. See [[US Antitrust and Monopoly Timeline]].