Item 3. Legal Proceedings
Item 3. Legal Proceedings .
On October 27, 2011,
the Company, together with National Amusements Inc. and the MovieTickets.com Joint Venture, filed a lawsuit against AMC Entertainment
Inc. (“AMC”) and MovieTickets.com Inc. (as nominal defendant) (Case No. 50 2011 CA 016684) in the Circuit Court of
the 15th Judicial Circuit in and for Palm Beach County, Florida relating to MovieTickets.com. On February 8, 2012, MovieTickets.com,
Inc. joined the lawsuit against AMC and an amended complaint was filed. MovieTickets.com is an online movie ticketing service
in which Hollywood Media, National Amusements, Inc. and AMC each own a 26.2% equity interest.
The amended complaint
alleges that AMC has breached and continues to breach the MovieTickets.com Joint Venture Agreement, which obligates AMC to exclusively
provide its ticket inventory to MovieTickets.com, and has breached its contractual and common law duties of good faith, fair dealing,
and loyalty with respect to the MovieTickets.com Joint Venture and its joint venturers, Hollywood Media and National Amusements,
Inc., as a result of various actions by AMC. The amended complaint contends that when AMC’s demands for greater control
and a larger share of MovieTickets.com were not met, AMC breached and continues to breach the MovieTickets.com Joint Venture Agreement,
which obligates AMC to exclusively provide its ticket inventory to MovieTickets.com. The amended complaint further specifies breaches
by AMC of its contractual and common law duties of good faith, fair dealing, and loyalty and violations of Florida’s Deceptive
and Unfair Trade Practices Act. Among other things, the plaintiffs allege in the amended complaint that AMC used its inside
position with MovieTickets.com and access to MovieTickets.com’s proprietary information in order to advance AMC’s
own goals in contravention of its duty of loyalty to the joint venture and to the detriment of MovieTickets.com.
Hollywood Media and
the other plaintiffs have asked for a jury trial and are seeking unspecified consequential damages and have reserved the right
to seek punitive damages. Hollywood Media and the other plaintiffs also are seeking a declaratory judgment that
AMC is obligated to make available on MovieTickets.com’s website AMC’s ticket inventory for sale on an exclusive basis
and to honor its contractual and common law fiduciary duties of good faith and loyalty to the MovieTickets.com Joint Venture and
its joint venturers, Hollywood Media and National Amusements, Inc.
Item 4. Mine Safety Disclosures.
None
13
PART II
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.