AMC, Regal Can’t Boycott to Stop Luxury Chain

HOUSTON (CN) — A Texas appeals court refused to lift an injunction blocking AMC and Regal from threatening to boycott movie studios that license first-run films to a luxury movie theater in an effort to shut down the fledgling chain.

IPic-Gold Class Entertainment, of Boca Raton, Florida, touts itself as a high-end alternative to traditional movie theaters. Its theaters have large reclining leather seats, pillows, blankets, reserved seating, fine dining, alcoholic drinks, seat-side wait service and free popcorn.

The growing theater chain filed an antitrust lawsuit against Regal Entertainment Group and AMC Entertainment Holdings in November 2015, the same month that it opened an eight-screen Houston location.

IPic claims that Regal threatened movie studios by telling them it would refuse to play recently released movies at its nearby megaplex if they licensed the films to iPic Houston.

AMC and Regal are acting in "lockstep" to stifle competition, iPic says in the lawsuit filed in Harris County.

The same day Regal threatened to boycott studios' new films at its theater, iPic says, AMC made the same threat about iPic's planned theater in Frisco, about 25 miles north of Dallas. That theater is set to open in 2017.

Texas' First Court of Appeals rejected the movie houses' request to reverse the temporary injunction issued in January. The order prohibits them from requesting from any film distributor the right to exhibit films to the exclusion of iPic Houston.

"In sum, we hold that the trial court did not abuse its discretion in concluding that iPic demonstrated a probable, imminent, and irreparable injury," Judge Rebeca Huddle wrote in the September 29 ruling.

IPic says it's competing for different customers than those who attend the "megaplexes" operated by AMC and Regal; that it's opening of other theaters has not reduced the ticket sales of nearby megaplexes, but increased the total number of moviegoers; and it's in Hollywood studios' interest to license first-run films to all theaters.

The court found that Regal's conduct harmed the market for premium exhibition of first-run films, and that iPic presented evidence showing "the existence of a conspiracy or coercion."

IPic calls AMC, Regal and Cinemark the "Big Three" in the lawsuit. It says they "control 60 percent of the revenue from movie ticket sales in the United States," and "60 percent of the screens and 69 percent of the box office revenue" in Houston.

Cinemark is not a defendant in the lawsuit.

IPic now runs 14 theaters in 10 states. It seeks damages for three violations of the Texas Antitrust Act. A trial is set for March.

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