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Bryan Cranston-owned theater's case against Cinemark heads to court

Bryan Cranston-owned theater's case against Cinemark heads to court
Cinemas Palme d'Or part-owner Bryan Cranston attends the L.A. premiere of "All the Way" at Paramount Pictures. (Richard Shotwell/Invision/AP)

Bryan Cranston's independent movie theater may be closing its doors, but its legal case against national chain Cinemark lives on.

This week an appeals court in California sided with Palm Desert movie house Cinemas Palme d'Or, reinstating its long-pending antitrust lawsuit against the third-largest theater operator. Palme d'Or has long accused Plano, Texas-based Cinemark of pressuring movie studios to keep the indie theater from getting the biggest film titles.

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The latest move reverses a previous court decision in 2014 to dismiss the case because of the loss of emails that were sought as evidence.

Cinemas Palme d'Or part-owner hailed the decision, which paves the way for the theater to make its case in front of a jury.

"It's unfortunate that we've had to choose this long path to seek justice, but we are pleased with the court's decision," the Emmy-winning "Breaking Bad" star said in a statement.

In 2006, Palme d'Or accused Cinemark of "circuit dealing," an industry practice in which theater chains leverage their size and buying power to prevent distributors from booking movies at theaters owned by their rivals.

Cinemark did not immediately respond to a request for comment, but the company has long denied that it engages in circuit dealing. In court filings, Cinemark has argued that its business practices are lawful and that it did not have sufficient strength in the Coachella Valley market to stifle competition. The company runs the 15-screen River Cinema in nearby Rancho Mirage.

Besides Cranston, Palme d'Or's owners include ESPN radio personality Steve Mason and businessmen Andreas Mauritzson and Brian Tabor.  They opened the 10-screen location in 2003 with ambitions to create a destination for cinephiles to see the kinds of art house, specialty and foreign films often restricted to the Los Angeles city limits.

But in April, the theater announced it could no longer stay in business, citing its protracted battle with Cinemark that prevented it from getting enough major film releases.

It is set to officially shut down June 30. The ongoing dispute reflects tensions between independent theater owners and big chains. Mom-and-pop operators have complained that their bigger rivals have abused the tradition of so-called clearances, in which chains ask studios for exclusive rights to show a movie within a certain geographic area.

The Justice Department has been investigating the issue of clearances, which is seen as less expansive than circuit dealing, to see whether the largest chains have violated federal antitrust laws.

Studios have become increasingly divided on the practice. This year, 20th Century Fox said it would no longer honor clearance requests from cinema chains. Universal Pictures will stop granting the requests after the release of its movie "Warcraft" in June, and Paramount Pictures has historically denied clearances.

Other major studios have continued the practice.

Follow Ryan Faughnder on Twitter for more entertainment business coverage: @rfaughnder

UPDATES:

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May 26, 4:24 p.m.: This post has been updated with additional information about clearances.

It was originally published at 3:11 p.m.

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