Coming to a Theater Near You: State Attorney General Antitrust Investigations

As holiday moviegoers shattered box office records this past weekend, both the Department of Justice and ten state attorneys general were in the midst of investigating why so many movie fans were headed to so few theater chains.

Ohio AG Mike DeWine’s office confirmed on Friday that he has been investigating the nation’s three largest movie theater chains — AMC, Cinemark, and Regal — for possible antitrust violations. In particular, the AG is seeking to learn whether the chains have engaged in unfair conduct that excluded smaller and independent theater operators. “All businesses should have a fair chance to compete,” DeWine said in a press release. Though DeWine’s office declined to name the other attorneys general involved, AMC’s quarterly SEC filings acknowledge receipt of similar requests from the AGs of New York, Texas, Florida, Washington, Kansas, and the District of Columbia. Regal and AMC had revealed the federal investigation in SEC filings in June 2015, which focused on “clearance agreements.” Such agreements give theaters the exclusive right to screen a particular film in a particular market.

Though antitrust cases in federal court under federal law are widely publicized, many states also have anti-trust laws which can be enforced by state attorneys general. In Ohio, for example, the state AG may act as the attorney at law for antitrust cases, or may appoint a special counsel, Ohio Rev. Code § 109.81, and the maintenance of monopolies is illegal under Ohio law. Ohio Rev. Code §§ 1331.01-14. As in many states, persons in Ohio injured by anticompetitive activity may privately bring suit in state court. Ohio Rev. Code § 1331.08. Massachusetts law contains a parallel provision. M.G.L. c. 93, § 12.

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