Flagship Theatres of Palm Desert, LLC v. Century Theatres, Inc.Annotate this Case
In this antitrust dispute involving licensing of motion pictures to movie theaters for public exhibition, Flagship obtained a jury verdict against Century. Flagship owned the Palme d'Or theater and Century owned The River theater. The jury found true Flagship's allegations that Century had engaged in "circuit dealing" by entering into licensing agreements with film distributors that covered licenses to play films not just at The River, but at multiple other Century-owned theaters as well, and using these agreements to pressure distributors into refusing to license films to Palme d'Or.
The Court of Appeal agreed with Century that Flagship did not present substantial evidence of anticompetitive effects in the relevant market. The court also agreed with Century that this failure of proof warrants reversal, as circuit dealing based on multi-theater licensing agreements is not per se illegal under the Cartwright Act. Therefore, the court reversed the judgment and need not reach Century's remaining arguments on appeal. The court also did not need to address Flagship's case from the court's postjudgment order awarding Flagship attorney fees in an amount lower than Flagship had requested.