Class-action lawsuits and 'F' ratings from the Better Business Bureau: Customers should be wary of MoviePass and Sinemia

Marvel Studios/Disney

• Movie-ticket subscription services have been the hottest topic in the movie-theater business this year, as MoviePass has sparked a surge in customer interest.
• But both leaders in the space that aren't tied to a specific chain, MoviePass and Sinemia, have "F" ratings from the Better Business Bureau.
• They have also both been hit with class-action lawsuits that are ongoing.
• Since I began to report on the space, I have received hundreds of angry complaints from customers, especially in recent months.

Over the last year, the rise of MoviePass has helped stoke widespread interest in movie-ticketing subscription services. But the Better Business Bureau has a message for potential customers: buyer beware.

In general, there are two main types of subscription services on the market in the US: those tied to a specific theater chain like AMC Stubs A-List (AMC Theatres), and those that can be more widely used (like MoviePass and Sinemia).

The services that offer theater flexibility can feel like the more attractive option for many consumers. But the two main competitors in that space, MoviePass and Sinemia, both sport an "F" rating from the Better Business Bureau.

MoviePass has had a whopping 2,461 complaints filed against it, while smaller Sinemia has had 169.

Both also have had class-action lawsuits filed against them that are still ongoing.

MoviePass' parent company, Helios and Matheson Analytics, had two class-action suits filed by shareholders in August, one of which alleged that some of Helios' "statements to the market were materially false or misleading." It had a further lawsuit filed against it by a shareholder in September, alleging "breach of fiduciary duty" and "unjust enrichment" by some officers of the company.

Sinemia was hit with a class-action lawsuit this month from customers primarily over the introduction of a new $1.80 processing fee. The lawsuit claims Sinemia "lures consumers in by convincing them to purchase a purportedly cheaper movie subscription, and then adds undisclosed fees that make such purchases no bargain at all."

Read more: MoviePass competitor Sinemia is being sued by angry customers who say it ripped them off with new fees.

This year, throughout the course of reporting on both companies, I received hundreds of complaints from angry customers, and in the case of MoviePass, angry investors as well.

The common gripes about both services have been a lack of customer service and technical glitches that prevent them from seeing movies. Specifically for MoviePass, some customers have also felt cheated by the severe restrictions on movies and showtimes, which some said makes the app effectively unusable. For Sinemia, dozens complained of hidden fees, and multiple customers said they'd had trouble getting partial refunds for year-long prepaid accounts after they attempted to cancel because of major service changes (the new processing fee, for example, which is the subject of the lawsuit).

Since the summer, when MoviePass introduced unpopular restrictions and Sinemia saw a surge in new subscribers, the vast majority of people who have contacted me have had very negative experiences with both apps. Those sentiments are reflected in MoviePass and Sinemia's abysmal ratings from the Better Business Bureau.

The takeaway I've had, as both a reporter and as a subscriber to both services, is that when the deal sounds too good to be true, it usually is.

MoviePass and Sinemia did not immediately respond to a request for comment from Business Insider.