Movie theater industry: DOJ inaugurates a new shakedown

Movie theater industry: DOJ inaugurates a new shakedown

[Ed. – What unnatural acts of “cooperation” and compliance will the theater chains have to perform, to get out from under this one?]

Regal Entertainment Group and AMC Entertainment Holdings Inc., the nation’s two largest movie theater chains, have received formal inquiries from the Justice Department’s Antitrust Division, signaling growing government scrutiny of a tactic large theater operators commonly use to keep movies out of competing locations.

AMC, which has faced the most backlash in the exhibition industry over the practices, told investors the Justice Department wants information “in connection with an investigation,” according to an AMC notice filed with the Securities and Exchange Commission on Monday, into “potentially anticompetitive conduct” at the company.

Regal made a similar disclosure on Monday. …

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The Justice Department’s civil investigative demands, received by AMC and Regal on May 28, give it subpoena power and request documents and answers to certain questions. AMC and Regal soon after received additional civil investigative demands from the office of the attorney general of Ohio, which has a “similar inquiry” under that state’s antitrust laws, AMC’s notice said. …

The government’s interest in clearance practices appears to have grown from a separate DOJ investigation into the proposed merger of National CineMedia Inc. and Screenvision LLC, two major in-theater advertising companies. Justice filed a lawsuit last November seeking to block the deal, and the companies scrapped it in March. Regal, AMC and Cinemark are majority owners of National CineMedia.

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