- Cineplex (TSX:CGX) is appealing a decision by the Competition Tribunal after being fined millions of dollars, accused of deceptive marketing practices
- The tribunal fined the movie theatre company C$38.9 million for charging a C$1.50 online booking fee
- Cineplex has been granted an interim stay of the monetary penalty until its motion is heard by the Federal Court of Appeal
- Cineplex stock opened trading at C$10.35
Cineplex (TSX:CGX) is appealing a decision by the Competition Tribunal after being fined millions of dollars, accused of deceptive marketing practices.
The tribunal fined the movie theatre company C$38.9 million for charging a C$1.50 online booking fee. The Tribunal has ordered Cineplex to refrain from the practice for the next 10 years, as well as pay a fine equivalent to the revenue it collected since introducing the online booking fee in June 2022 until December 2023.
The Canadian theatre chain released a statement on Thursday stating that its team filed a notice of appeal with the Federal Court of Appeal to overturn the Competition Tribunal’s recent decision against Cineplex.
“With the consent of the Competition Bureau, we are bringing a motion to request a stay of the monetary penalty pending completion of the appeal. We have been granted an interim stay of the monetary penalty until our motion is heard by the Federal Court of Appeal,” the statement reads. “We continue to emphasize that the online booking fee has always been about choice and is an optional, value-added service. It provides moviegoers with the convenience of online booking – knowing they have a ticket for a specific show time and an exact seat location before they arrive at a theatre. We believe that the fee is presented on our website and app in a clear and prominent manner, and fully complies with the spirit and letter of the law.”
The decision stems from a May 2023 application by the Canadian Competition Bureau, which linked the fee to the practice of deep pricing. This involves attracting customers with low prices, only to tack on mandatory fees later in the purchasing process.
Cineplex Inc. is a household Canadian brand active in the film entertainment and content, amusement and leisure and media sectors. It operates more than 169 movie theatres and entertainment venues across the country.
Cineplex stock (TSX:CGX) opened trading at C$10.35 and has risen 23.18 per cent since the year began.
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(Top photo of Cineplex corporate office in Toronto: Yonge and St. Clair BIA)
