Theater chains subject of federal antitrust probe
Columbus, Ohio — The Justice Department and several states are investigating alleged antitrust violations by the country’s biggest movie theater chains, according to securities filings and the Ohio attorney general.
AMC Entertainment Holdings Inc. and Cinemark Holdings Inc. both acknowledged investigative demands by the government in recent SEC quarterly filings. Last month, AMC also acknowledged similar requests from Ohio, Florida, Kansas, New York, Texas, Washington and the District of Columbia.
Ohio Attorney General Mike DeWine said Thursday his office was the first among 10 jurisdictions examining whether AMC, Cinemark and Regal Entertainment Group have taken action to keep competitors and new theaters out of the market.
At issue is so-called exclusionary conduct by AMC, Cinemark and Regal that would limit consumers’ choices and stifle innovation, DeWine said. The investigation is looking at whether the chains have tried to thwart independent movie theaters and nonprofit film centers, among others, said DeWine spokesman Dan Tierney.
“All businesses should have a fair chance to compete,” DeWine said. “We’re investigating the movie theater chains because of concerns that smaller, independent businesses have been unfairly pushed out of the market.”
DeWine’s office declined to reveal the other nine states involved in the probe.
All three major U.S. theater chains – AMC, Regal, and Cinemark – have previously said that clearance agreements are a long-established industry practice that only affect a small number of locations. Additionally, they say the requests are only approved at the discretion of movie studios.
The government wants documents related to potentially anticompetitive conduct, “including film clearances and participation in certain joint ventures,” AMC said in a Nov. 4 SEC filing. The company said it may receive similar requests from other jurisdictions.
“The Company does not believe it has violated federal or state antitrust laws and is cooperating with the relevant governmental authorities,” AMC said in the SEC filing.
The Justice Department declined to comment.
Messages seeking comment were left with AMC, Cinemark and Regal.
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