Russia’s largest cinema chain has filed a lawsuit against IMAX, demanding that the large format company resumes operations in Russia. The lawsuit from the joint cinema chains Formula Kino and Cinema Park is due to IMAX pulling out of Russia on 1 June of this year, after Hollywood studios and other companies severed economic ties with Russia following the February invasion of Ukraine.
The lawsuit was filed on 26 October by the cinema chain’s legal entities Cinema Park and Rising Star Media. The lawsuit seeks to compel IMAX “to perform duties in kind,” i.e. to do what is written in their contract, rather than to pay compensation or fiscal damages. The lawsuit follows a ruling of the Arbitration Court in Moscow. In August the CEO of the Formula Kino and Cinema Park cinema chain, Alexei Vasyasin, stated in an interview that the chain planned to sue IMAX to comply with the terms of its contract if it does not resume work by the end of this year. Although the IMAX equipment belongs to the cinema chain, IMAX is thought to have forbidden it from being used to screen films.
In August of this year the Arbitration Court of the Chelyabinsk Region accepted case brought before it by Empire Games company, the parent company of the Soft Cinema network. There were no IMAX representatives at the preliminary hearing, as there are reportedly none left in the Russian Federation. The next hearing in the case is scheduled for 6 March 2023. According to research by Neva Film, Soft Cinema network had to close 32% of its screens in the first half of 2022, more than any other Russian cinema chain. As reported in Russian business newspaper Kommersant:
According to Mr. [Alexey] Voronkov [Chairman of the Association of Cinema Owners (AVK)], cinema chains suing IMAX are counting on the return of the global film business to the country: “There will be no such relations as before. If suddenly in five or ten years the film companies decide to start working again in Russia, the decision of the court in the IMAX case will be a trump card for cinemas.” It is impossible to change the situation out of court, he believes, since IMAX “will never admit that they have agreed on something with Russian companies.”
Unlike regular digital cinema projectors, KDMs for films screened on IMAX systems are issued by IMAX rather than by distributors of each title. IMAX also carries out daily remote software updates and checks on the system before each screening, adjusting picture and sound. It is thus not possible for a cinema to over-ride or operate the IMAX equipment locally. Russian cinemas have had to rely on domestic films or film imported from markets such as India or Korea in the absence of Hollywood films, though some Russian cinemas have shown pirated versions of the latter. But none of these films cannot be shown on IMAX screens without IMAX’s active consent and involvement.
It is believed that Formula Kino and Cinema Park are pursuing the right to operate the equipment itself, but since the details of the company’s contract with IMAX are not known, the legal outcome of this case cannot be easily predicted. Similar court cases have been persued earlier, following the withdrawal of many Western companies in the wake of Russia’s attack on Ukraine. Russian Railways succeeded in compelling Germany’s Siemens to fulfill its obligations through interim measures, as part of its claims to challenge the unilateral termination of its contracts. Following the ruling, special tools, measuring equipment, spare parts, as well as other materials and equipment necessary that were covered by the contract were transferred to Russian Railways.
Neither representatives from Formula Kino and Cinema Park or IMAX have commented on the latest lawsuit.
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