Regal Ordered to Stop Blocking One Movie Theater's Access to Studio Films

A Texas judge issued an injunction that prohibits Regal from demanding exclusive film licenses near iPic's Houston theater.
 Courtesy of AEG

Regal Entertainment must stop preventing a smaller movie chain from gaining access to studio films like The Hateful Eight, Ride Along 2 and The Revenant, a Texas state judge has ruled.

The temporary injunction order on Friday comes at the behest of iPic, which alleges that Regal has coerced Universal, Sony, 20th Century Fox, Lionsgate and The Weinstein Co. The plaintiff's antitrust lawsuit targets so-called "clearance" pacts, which ensure that first-run films are only shown at certain theaters in a set geographical region.

iPic and other small independents have voiced anticompetive concerns about the arrangement between exhibitors and distributors. Several lawsuits around the country are pushing the case that the three largest exhibitors — Regal, AMC and Cinemark — are using their nationwide dominance to push Sony and others into holding back popular films from smaller competitors in local areas. The concerns are also being investigated by the U.S. Department of Justice, according to SEC filings.

In pending lawsuits, judges have split. Regal beat one lawsuit in California while over in Georgia, an independent theater owner was allowed to move forward in a case against AMC. A lawsuit is also pending against Regal in New York and another lawsuit targets AMC in Texas.

The latest decision marks the first time that a judge has intervened in the ongoing controversy by enjoining a theatrical giant from demanding exclusive film licenses.

iPic runs a theater in the River Oaks District of Houston, Texas.

According to the plaintiff, Harris County Judge Wesley Ward found this iPic theater not to be in "substantial competition" with the Regal Greenway Grand Palace Stadium and ordered Regal to refrain from demanding "clearances."

Regal had no comment about the ruling. A trial is tentatively scheduled for October.

The order states, "Based on the evidence presented at the evidentiary hearing, defendant Regal Entertainment Group's actions did and will prevent plaintiffs from licensing first-run films to exhibit at plaintiffs' Houston theater. Access to the films is essential to plaintiffs' business. Defendant Regal's actions will cause imminent, irreparable harm to plaintiffs' business, property, reputation, and goodwill, as well as to the movie-going public."

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