U.S. court ruling in Cineworld bankruptcy proceedings halts Cineplex case in Ontario

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TORONTO — Cineplex Inc. says a US court decision will mean the Ontario Court of Appeal will not hear a case between the Toronto theater giant and its former suitor Cineworld Group PLC as planned.

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Cineplex says the U.S. court, where U.K.-based Cineworld filed for bankruptcy earlier this month, denied Cineplex’s request to allow a Canadian case between the two companies to proceed as was due in October.

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Cineplex says Cineworld and its subsidiaries took the position that the Canadian case was contingent on proceedings before the United States Bankruptcy Court for the Southern District of Texas.

The Canadian case dates back to 2020, when Cineworld walked away from a $2.18 billion deal to buy Cineplex, sparking a court battle over whether Cineworld had the right to get out of the deal.

An Ontario court ruled in favor of Cineplex last year, awarding the company $1.24 billion in damages, but Cineworld has since appealed the ruling while Cineplex is seeking an even higher payout.

Cineplex says its case still has merit and it will continue to pursue other avenues to recover the money it believes it is owed.

This report by The Canadian Press was first published on September 28, 2022.

Companies in this story: (TSX:CGX)

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