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AMC Wins Antitrust Suit As Texas Justices Find No Collusion

Jan. 14, 2022, 7:33 PM

Movie theater chain AMC Entertainment Holdings Inc. won an antitrust case brought by iPic-Gold Class Entertainment LLC, alleging AMC had conspired with another movie theater to keep iPic out of two Texas locations, under a ruling from the Supreme Court of Texas on Friday.

In a reversal of an appeals court ruling, the state’s highest court said that the alleged collusion between AMC and Regal Entertainment Inc. to stop luxury movie theater iPic from screening first-run movies in Houston and Frisco was “implausible.”

The two alleged conspirators would have to endure losses for a long period of time, and each would have a strong incentive to let the other suffer losses, the court said.

“The absence of any plausible motive to engage in the conduct charged is highly relevant to whether a genuine issue for trial exists,” said Chief Justice Nathan L. Hecht in the opinion.

The Court of Appeals, First District, had ruled in December 2019 that iPic had offered enough circumstantial evidence of collusion by AMC and Regal to go to trial. The trial court had previously granted summary judgment to AMC after Regal settled.

The high court rejected iPic’s claims that AMC and Regal used a film distribution joint venture called Open Road to conspire, because there was no evidence that the two movie theater chains ever communicated about iPic.

There was no evidence that AMC and Regal sought to act as a unit rather than independently when they made decisions to ask film distributors for clearance to screen first-run movies, the opinion said.

Under the Texas Antitrust Act and federal law, iPic argument can’t survive summary judgment because it rests only on “parallel conduct and suspicion,” the court said.

The court’s opinion was unanimous. Justice Evan Young did not participate in the decision.

AMC was represented by Norton Rose Fulbright US LLP. Yetter Coleman LLP represented iPic.

The case is AMC Ent. Holdings Inc. v iPic-Gold Ent. LLC, Tex., No.20-0014, 1/14/22.

To contact the reporter on this story: Janet Miranda in Houston at jmiranda@bloombergindustry.com

To contact the editor responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com

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