Exhib accused of tampering with ads, promotion

SYDNEY — Ill feeling between U.S.-owned exhib Reading and Hoyts Cinemas has escalated after Reading sued Hoyts in the Federal Court of Australia.

Reading launched its action last month after Hoyts allegedly instructed its cinema managers in New South Wales to remove a discount ticket coupon that Reading inserted in the December/January issue of Filmink, a mag distributed free at theaters around Australia.

The card, an attempt to inspire customer loyalty, enabled readers to buy two tickets at Reading’s cinemas for $A8.50 ($4.42) each, usable on three occasions.

Reading sought an injunction seeking to stop Hoyts from interfering with the mag. The case will be heard Feb. 12, Reading Entertainment Australia chief operating officer Neil Pentecost told Daily Variety, adding that Reading would allege Hoyts has breached the Trade Practices Act and seek damages.

Hoyts declined comment, but Monday’s Sydney Morning Herald quoted a letter from Hoyts’ lawyers Minter Ellison to Reading, dated Jan. 10, which said, “Our client does not admit the allegations” but adds later, “We are instructed that if the alleged conduct did occur, Hoyts has taken steps internally to ensure that it would not happen again.”

Reading execs see this as yet another in a series of moves by Hoyts (often in concert with the other big circuits, Village and Greater Union) aimed at inhibiting its ability to expand in Australia ever since Reading entered the market in 1995.

Reading U.S. chairman Jim Cotter lets fly at Hoyts’ owner Kerry Packer in the Herald article, asking rhetorically, “Could you imagine what Mr. Packer’s reaction would be if newsstands around Australia decided to destroy Packer’s publications because a competitor instructed them to do it?”

Cotter added, “We have been in Australia for over six years and have made a substantial investment and a contribution to the entertainment needs of the country. You would have thought these guys would have said to themselves by now ‘enough is enough.’ “

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