Cinemark and IMAX End Legal Battle Over Digital Cinemas

Companies resolve patent claims and will open new theaters together in California and Texas

After a years-long legal standoff, Cinemark Holdings and IMAX are burying the hatchet.

The two companies announced Monday that they have amicably resolved their litigation claims against each other and are partnering on a series of IMAX theaters in Cinemark owned locations. 

Terms of the settlement were not disclosed.

In September 2009, IMAX sued Cinemark over its attempts to produce its own high-end theater system. In court filings, IMAX charged that Cinemark had violated its contract and stolen trade secrets stemming from its long association with the big screen chain to build a competing system called Cinemark XD and Extreme Digital Cinema.

Yet, the two have put aside their differences and say that all claims and counterclaims in the patent litigation in Texas and contract litigation in New York are being dismissed with prejudice.

Cinemark Holdings will acquire two new digital IMAX theatre systems in Lancaster, Calif. and Corpus Christi, Texas, the companies announced Monday.

Both theatres are expected to open by April of 2011. In addition to adding two new sites, Cinemark will upgrade all six of its film-based IMAX locations to IMAX digital theaters. That should also be completed by April.