December 5, 2002

In a departure from prior judicial decisions, the United States District Court for the Central District of California (part of the Ninth Circuit) held on November 20, 2002 that a movie-theater owner who provides wheelchair seating only in the front rows of the auditorium deprives persons with disabilities of equal access, benefits and services in violation of the Americans with Disabilities Act (the “ADA”). This decision, United States v. AMC Entertainment, Inc., rejected AMC’s position that ADA guidelines as to lines-of-sight require only that theater operators provide an unobstructed view.

FACTS
In 1995, AMC Entertainment, Inc. (“AMC”) began to open stadium-style theater complexes, in which the majority of the seats are located on tiered rows, as opposed to a gradually sloping floor. The purpose of this design is to provide customers with enhanced, unobstructed lines of sight to the screen. In front of the tiered seating, approximately 2-4 rows of seats are placed on a sloped floor closest to the screen. Wheelchair and companion seating in AMC’s theaters is often located solely in this front section. Only 23.8% of AMC’s stadium-style theater auditoriums nationwide have wheelchair seating located in the tiered section. The United States Department of Justice filed suit against AMC claiming that the placement of this seating denies persons with disabilities equal access, benefits and services in violation of Title III of the ADA.

DISTRICT COURT
The district court granted summary judgment in favor of the United States, relying on §4.33.3 of the ADA Accessibility Guidelines, which requires that wheelchair areas “be provided so as to provide people with . . . lines of sight comparable to those for the general public.” The court rejected AMC’s argument that “line of sight” refers only to possible obstructions, concluding that this language refers not only to possible obstructions, but also to viewing angles. Because viewing angles from the sloped-floor portion of the theater are far inferior to the viewing angles from the tiered rows, the court held that AMC’s designs of stadium-style theaters that place wheelchair seating solely on the sloped-floor portion of the theater fail to provide “lines of sight comparable to those for members of the general public,” and consequently, violate §4.33.3. The decision will apply retroactively to all such AMC theaters.

The AMC Entertainment decision is inconsistent with a Fifth Circuit Court of Appeals decision rendered in 2000, Lara v. Cinemark, as well as another District Court decision in the Ninth Circuit, Oregon Paralyzed Veterans v. Regal, that relied on the Lara decision. The Oregon Paralyzed Veterans decision is now on appeal, so it is anticipated that the Ninth Circuit Court of Appeals will weigh in on this matter in the coming months. The reasoning in the AMC Entertainment decision might serve as the basis for the Ninth Circuit rendering an appellate decision inconsistent with the Fifth Circuit’s Lara decision. It should also be noted that the AMC Entertainment decision rejected AMC’s request that the ruling not apply to AMC’s theaters in the Fifth Circuit. Hence, if the Ninth Circuit does depart from the Lara decision, the Department of Justice apparently could, where jurisdiction is appropriate, obtain company-wide compliance by filing suit in the Ninth Circuit against theater operators.

SIGNIFICANCE
There may be several interesting repercussions for anyone that owns or finances projects that include theaters with stadium-style seating. Some projects depend on stadium-seating theaters to bring in traffic for other tenants. If some theaters are taken out of operation for a retrofitting period, it could have an impact on other tenants, especially the restaurants. Reconfiguring existing stadium-seating theaters to provide handicapped viewing from a higher location may well be both expensive and time consuming to implement. Landlords will want to examine their theater leases to confirm that the tenant is obligated to bear the expense of the renovation.

If you have any questions concerning the referenced decision, please feel free to call any of the following members of our Finance Group:

Scott Abrahamson 310-201-8925
Anna Andrews 310-201-8928
Jim Brat 310-201-8970
Andrea Bricker 310-201-8932
Chad Buelow 310-201-8974
John Cauble 310-201-8930
Steve Carey 310-201-8904
Jim Goldman 310-201-8958
Xavier Gutierrez 310-201-8989
Sheldon Halpern 310-201-8975
Steven Heller 310-201-8941
John Irons 310-201-8937
Bill Jackson 310-201-8965
Alex Jacobs 310-201-8946
Andrew Kendall 310-201-8979
Doug Lahammer 310-201-8948
Richard MacCracken 310-201-8997
Larry Meeks 310-201-8903
Herb Meyers 310-201-8936
Phil Nichols 310-201-8902
David Packer 310-201-8973
Angela Robinson 310-201-8982
Michael Scheinberg 310-201-8952
Michael Seeman 310-201-8915
Eric Shortz 310-201-8977
Stephanie Silvers 310-201-8924
Heather Smith 310-201-8927
Bruce Speiser 310-201-8908
Sheiva Taban 310-201-8914
Bill Ticknor 310-201-8956
Fred Unikel 310-201-8985