Antitrust Law Daily Wrap Up, ANTITRUST—Tex. Dist.: Regal prohibited from blocking boutique theater’s access to films, (Jan 25, 2016)

By Greg Hammond, J.D.

The Harris County, Texas, District Court has granted iPic-Gold Class Entertainment, LLC a temporary injunction that prohibits Regal Entertainment Group from preventing iPic from licensing first-run films to exhibit at iPic’s Houston theater (iPic-Gold Class Entertainment, LLC v. Regal Entertainment Group, January 25, 2016, Ward, W.).

The temporary injunction prohibits Regal from engaging in anticompetitive and unlawful conduct by: (1) demanding or requesting exclusive film licenses or the right to exhibit films from any studio to the exclusion of iPic’s Houston theater; (2) indicating to a studio that such defendant will refuse to play a film at any of its theaters if the studio licenses the film for exhibition at the iPic Houston, or carrying out such refusal; or (3) communicating between the Regal and AMC defendants, or coordinating their respective communications with any studio, with regard to preventing iPic from receiving licenses to first-run films to exhibit at the iPic Houston.

iPic’s complaint, which alleges violations of the Texas Antitrust Act, claims that Regal and AMC have exploited their market power to prevent new competition from entering the market. In particular, the complaint alleges that Regal and AMC have threatened to boycott studios that don’t concede to their demands of denying film licenses to new theaters.

Antitrust Division, Ohio investigations. The Department of Justice, Antitrust Division and the Antitrust Section of the Ohio Attorney General’s Office are also investigating possible anticompetitive conduct by Regal and AMC, according to SEC filings.

“We do not believe the Company has violated federal or state antitrust laws and are cooperating with the relevant governmental authorities,” AMC’s filing stated. “However, we cannot predict the ultimate scope, duration or outcome of these investigations.”

The case is No. 2015-68745.

Attorneys: R. Paul Yetter (Yetter Coleman LLP) for iPic-Gold Class Entertainment, LLC and iPic Texas LLC. Samuel W. Cooper (Paul Hastings LLP) for Regal Entertainment Group. Michael A. Swartzendruber (Norton Rose Fulbright) for AMC Entertainment Holding Inc., AMC Entertainment Inc. and AMC Inc.

Companies: iPic-Gold Class Entertainment LLC; iPic Texas LLC; Regal Entertainment Group; AMC Entertainment Holding Inc.; AMC Entertainment Inc.; AMC Inc.

Cases: Antitrust TexasNews