Cineplex Appeals $38.9 Million Penalty in Drip Pricing Case

Cineplex Inc. is set to appeal a significant ruling that imposed a record penalty of $38.9 million for misleading pricing practices. The decision, stemming from a Competition Tribunal ruling in September 2023, has drawn attention from industry experts who view it as a cautionary tale for businesses engaged in similar practices.

The case revolves around allegations that Cineplex misled customers by not clearly disclosing an additional fee of up to $1.50 for online ticket bookings. The Competition Bureau initiated the investigation, identifying the pricing structure as a form of drip pricing—a tactic where an initially low price is advertised, only to be inflated by additional fees during the purchasing process.

Cineplex, which declined to comment on this specific case, maintains that it has been transparent about its pricing. The company argues that these charges can be avoided by purchasing tickets directly at the theater, claiming that the fee is prominently displayed during the booking process.

Implications for Businesses

Experts suggest that regardless of the outcome of the appeal, the case serves as a strong warning to other companies. According to Vass Bednar, co-author of “The Big Fix: How Companies Capture Markets and Harm Canadians,” the Competition Bureau aims to signal to the marketplace that deceptive pricing practices will not be tolerated. “This case represents a core issue of advertising a price that isn’t actually attainable,” Bednar stated.

The ramifications of this case extend beyond the cinema industry. Many sectors, such as airlines and rental car companies, frequently employ similar pricing tactics. Bednar highlighted how the airline industry has undergone a “great unbundling of pricing,” where advertised low fares are often supplemented with additional fees for services like seat selection and baggage.

The Competition Bureau has already pursued claims against various companies for similar practices, including delivery service DoorDash and broadcaster SiriusXM Canada. While some cases have been settled outside of court, such as SiriusXM’s agreement to pay a $3.3 million penalty, others remain pending.

Consumer Protection and Regulatory Challenges

The issue of drip pricing has gained increased scrutiny, particularly since changes to the Competition Act strengthened the classification of deceptive marketing. These legal adjustments have allowed for more nuanced penalties to be imposed on companies engaging in such practices. Jennifer Quaid, a law professor at the University of Ottawa, noted that the bureau’s focus on deceptive marketing has resonated with the public, making it a source of pride for the agency.

The upcoming appeal is critical not only for Cineplex but also for consumers. The bureau views the tribunal’s initial ruling as a significant victory, asserting that Cineplex’s advertised ticket prices were “unattainable” and did not adequately inform customers about how the online booking fee could be avoided.

As Cineplex prepares its case, it plans to argue that the tribunal “erred” in its decision. The company asserts that it disclosed the online booking fee “immediately and prominently” and that customers can bypass the fee by purchasing tickets in person.

The outcome of this appeal will likely set a precedent for how companies disclose additional fees and could influence a wide range of industries. As Quaid remarked, the message to businesses is clear: “We’re watching, and you could get caught, and we will take you to court.”

This report was first published on October 7, 2025, by The Canadian Press.