SUITS CLAIM IMAX VIOLATED ANTITRUST LAWS.

Byline: Russ Britt Daily News Staff Writer

Two Southland builders of specialty movie theaters have filed separate antitrust lawsuits against their primary competitor in the last week, claiming the firm is blocking them from the big-screen moviehouse market.

Iwerks Entertainment of Burbank and Showscan Entertainment in Culver City claim that Toronto-based Imax Corp. has launched legal attacks, bought out key equipment suppliers and warned customers that films and equipment would be restricted if they do not purchase Imax systems. The two companies say Imax has captured up to 90 percent of the market.

Imax officials say the claims made in the two lawsuits - one filed Monday by Showscan, the other filed Feb. 26 by Iwerks - are without merit. Richard Gelfond, Imax vice chairman, said the antitrust litigation is in response to lawsuits filed against suppliers of Showscan and Iwerks.

Showscan's lawsuit comes three weeks after the company said it planned to enter the big-screen market, Gelfond said.

"I think both companies are scratching their heads, saying 'How can I get a piece of Imax's business?' " Gelfond said. "I think Showscan knew about what Iwerks did and tried to use the same strategy."

Imax has charged that Cinema Technologies Inc. in Santa Clara, an Iwerks supplier, and World Odyssey Inc. in Los Altos, a Showscan supplier - both makers of big-screen projectors - acquired knowledge of Imax's trade secrets before patents expired two years ago.

Showscan officials did not return phone calls Monday. The company's lawsuit states that Imax told potential customers that using a competing system would result in a court-ordered shutdown of their business, that it will obtain an injunction to stop competitors from supplying equipment and films and that Showscan system manufacturing could be shut down by court order.

"The value of the businesses of World Odyssey and Showscan have been partially destroyed," the suit said.

Iwerks officials would not comment but the company's attorney, Alicia Rosenberg, said Imax tried to restrict the supply of cameras that can be used on big-screen theaters, in part by acquiring many of the suppliers.

"Imax has damaged Iwerks' ability to compete in the market," Rosenberg said. "This is a promising market."

Imax has built 129 big-screen theaters throughout the world, including the Museum of Science and Industry in downtown Los Angeles, the Smithsonian Institution in Washington, D.C., and on the south rim of the Grand Canyon.

Imax beat out its two competitors last year to build a big-screen theater at the Irvine Spectrum in Irvine, considered a key deal in a promising local market.

Showscan and Iwerks have concentrated on building simulated thrill rides in recent years, such as theaters whose seats move in sync with action on the screen to simulate flying. Analysts said, however, the big-screen market appears to be more promising.

Imax is the oldest of the three companies, at 28 years, and has been the most profitable of late. Gelfond said Imax reported net profits of $3.6 million for fiscal year 1995, while Iwerks lost $13.5 million and Showscan made $100,000 after five years of losses.

But it is difficult to break into the big screen market, said John Taylor, analyst for Arcadia Investment Corp. in Portland, Ore. Companies such as Imax must invest significant up-front money to build the multistory theaters in order to reap the profits that come mostly from admission to the films.

"Building the theater is not an end, it's the means to an end," Taylor said. "They're having mixed results. Some are OK, some aren't."

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Photo (Color) Burbank's Iwerks Corp. and Culver City's Showscan Entertainment are suing Imax.