Cineplex's appeal against a $38.9 million penalty will be heard in Court in October
Cineplex Faces Appeal Over Deceptive Marketing Fine
Cineplex Inc., Canada's largest movie theatre chain, is preparing for a court battle over a $38.9-million fine imposed for deceptive marketing practices. The appeal hearing, scheduled for October 8, 2025, at the Federal Court of Appeal, will determine whether the fine stands or is overturned.
The fine originated from allegations by the Competition Bureau that Cineplex's online booking fee, introduced in June 2022, constituted "price dripping." The surcharge, amounting to $1.50, was not fully disclosed to customers upfront, leading to concerns of misleading practices.
Cineplex, however, argues that the fees were promptly disclosed and that customers can avoid them by purchasing tickets in person. The company disagreed with the fine and appealed, stating that it had adjusted how the online booking fee is communicated to moviegoers in November 2024.
CEO Ellis Jacob has expressed satisfaction about having a hearing date set, indicating the company is confident in its position as the appeal moves forward. Jacob, who will retire as CEO at the end of 2026, is waiting for the business to recover before he departs to spend more time with family and potentially pursue a law degree.
In its latest quarter, Cineplex reported a loss of $2.2 million, a significant improvement from a loss of $21.4 million in the same quarter the previous year. The company's revenue for the quarter ended June 30, 2023, was $361.8 million, a 30.5% increase from the previous year. The theatre exhibition industry is experiencing a rebound after suffering from two Hollywood strikes.
The appeal hearing will be closely watched as it could set a precedent for the way online booking fees are disclosed in the industry. In the meantime, Cineplex continues to perform well, setting new quarterly records for concession per patron at $10.04 and box office per patron at $13.68. Theatre attendance for the same quarter was 11.6 million, up from 8.7 million in the same quarter the previous year.
Notable movie releases in the quarter included "F1: The Movie," which marked the biggest global opening for an Apple original, and "Mission Impossible, The Final Reckoning," which saw the franchise's best opening domestically. "A Minecraft Movie" delivered the biggest opening of the year and the largest ever for a video game adaptation.
As the appeal process unfolds, Cineplex remains optimistic and committed to maintaining transparency with its customers. The theatre exhibition industry is poised for continued growth, with CEO Ellis Jacob predicting around 120 wide releases in the upcoming year, a significant increase from recent years.
- The upcoming appeal hearing at the Federal Court of Appeal could set a significant precedent for the disclosure of online booking fees in the entertainment industry, as Cineplex Inc., despite facing a $38.9-million fine for deceptive marketing practices, disagrees with the allegations and argues for transparency.
- As the appeal proceeds, Cineplex continues to thrive, with notable movie releases, such as "A Minecraft Movie" and "F1: The Movie," attracting large audiences, and the company showing optimism for the future of the theatre exhibition industry, predicting around 120 wide releases in the upcoming year.
