Injunction Granted Against Regal Theater Chain in 'Clearance' Lawsuit
January 25 2016 - 5:00PM
Dow Jones News
A judge has granted a temporary injunction against Regal
Entertainment Group, saying the nation's biggest theater chain must
stop requesting that certain cinemas in the Houston market get
exclusive access to certain movies.
The injunction increases the likelihood that the practice, known
in the exhibition industry as "clearance," will be debated in
court. A civil trial is set for Oct. 3.
The injunction had been requested by iPic Entertainment, a
Florida-based theater chain that accused Regal and its next-largest
rival, AMC Entertainment Holdings Inc., of using their market power
to reserve exclusive rights to certain movies and hurt the business
of smaller competitors. The iPic case, filed in a Houston state
court, involved locations in Texas, and the judge heard evidence
that included testimony from Regal Chief Executive Amy Miles.
The injunction issued Monday says Regal's practices "did and
will prevent plaintiffs from licensing first-run films to exhibit"
at iPic locations. "Regal's actions will cause imminent,
irreparable harm to plaintiffs' business, property, reputation and
goodwill, as well as to the movie-going public," the judge
wrote.
A representative for Regal said the company doesn't comment on
pending litigation. AMC didn't immediately respond to a request for
comment.
Clearance has become a more controversial practice in recent
years, even though it affects a small number of the nation's 40,000
screens. Several smaller operators have targeted the major chains
in lawsuits across the country, seeking an end to the practice.
Some small operators have said that clearance led to their
businesses having to close.
Government scrutiny of the practice also has heated up.
Among other accusations, IPic's suit accused Regal and AMC of
working together to get studios to grant them exclusive rights to
some movies. The injunction issued Monday mainly addressed Regal,
but did say the two companies aren't allowed to "[coordinate] their
respective communications with any studio."
Write to Erich Schwartzel at erich.schwartzel@wsj.com
(END) Dow Jones Newswires
January 25, 2016 16:45 ET (21:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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