Netflix, the Web's No. 1 recording rental service, and Wal-Mart are being accused in a class-action lawsuit of unfairly setting prices for their rental services.
According to the Web site of Video Business, the suit was filed earlier this week in U.S. District Court, Western Dominion of Arkansas. The lead plaintiff, Marci Badgerow, alleges that Wal-Mart agreed in 2005 to exit the online rental business in exchange for Ne tflix's termination of DVD sales, according to Video Business.
The plaintiffs argue that the agreement promotes unfair trade and is illegal. They assert that the pact harmed customers because it allowed Netflix to raise its monthly subscription price from $14.99 to $17.99, according to the report. Wal-Mart denied any wrongdoing.
"We made our own independent option to exit the DVD rental business and our subsequent agreement with Netflix is alone proper," said Michelle Bradford, a Wal -Mart spokeswoman. "We intend to defend vigorously our decisions regarding the products and services offered to our customers."
A Netflix spokesman declined to comment.
The two companies were accused in a similar suit filed in Northern California originally this month of conspiring to restrict competition and unfairly command pricing.
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