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Hollywood Doesn't Want You Betting on -- or Against -- It

By Eric Lipman

How much do you think the new "Nightmare on Elm Street" is going to rake in when it opens in a few weeks? You wanna bet? Sorry. I meant "Would you be interested in purchasing a futures contract?" Even if you would be interested, the movie studios and several lawmakers don't necessarily want you to have that option. The New York Times reports that the Motion Picture Association of America will be filing formal comments with the CFTC today urging it not to approve applications by Cantor Fitzgerald and somebody called Veriana to establish markets for box office futures. A pretty good simple explanation of how the exchanges might work can be found at the Movie Banter blog. The MPAA sent a letter (PDF) to the CFTC last week previewing some of its concerns, including the potential for manipulation and purported requirements that the studios supply proof of box office receipts to the entities running the proposed exchanges. California Senators Barbara Boxer and Dianne Feinstein also wrote to the Commission urging it to take the studios' views into account, as did Rep. Henry Waxman. Cantor already runs the Hollywood Stock Exchange, where the public can bet on the success of...

Full post as published by Legal Blog Watch on April 08, 2010 (boomark / email).