Movie Pass continues the fight to survive. The company dubbed the “Netflix of movies.” And their latest plan may look good on the surface But the devil is in the details.Buzz60’s Mercer Morrison
Helios and Matheson Analytics Inc., the parent company of subscription-based movie ticketing service MoviePass, is denying claims that it misled investors about its finances amid a fraud investigation.
The company said in an email on Wednesday that it is “fully cooperating” with the probe opened by New York Attorney General Barbara Underwood.
“We are aware of the New York Attorney General’s inquiry and are fully cooperating with it. We believe our public disclosures have been complete, timely and truthful and we have not misled investors,” Helios explained.
On Wednesday, a source familiar with the investigation said that the office of the attorney general opened the inquiry citing the Martin Act, a New York anti-fraud law often used to litigate issues related to securities trading. Under that statute, the AG’s office can bring civil or criminal actions against alleged violators.
The source was not authorized to speak publicly about an ongoing investigation and wished to remain anonymous.
Helios and Matheson acquired a majority stake in the movie-theater subscription service in August 2017 and took full ownership in February 2018 to continue “growth and expansion,” according to MoviePass.
The popular, but frequently troubled, company has since faced a number of setbacks.
In April, the company began preventing members from using the service to view the same movie more than once. Over the summer, it began testing out “surge pricing” and blocking in-demand showtimes. Also during that time, the app experienced service outages after MoviePass ran out of cash.
Most recently, MoviePass sent out a questionable email letting old customers know that the company would be un-canceling select user accounts unless they “opt out.”
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