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Paramount Takes Over Bay Theater in Pacific Palisades From Netflix
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In brief
Paramount Pictures, operating under its parent company Skydance, has taken over the lease of the Bay Theater in Pacific Palisades from Netflix and will reopen the fire-damaged venue later in 2026 with developer Rick Caruso. The deal follows the 2020 termination of the long-standing Paramount consent decrees, which had barred major studios from owning movie theaters for decades.
Paramount Pictures has taken over the lease of the Bay Theater, a five-screen cinema inside Rick Caruso's Palisades Village shopping center in Pacific Palisades, Los Angeles. The theater had been leased and operated by Netflix since 2021 but has sat closed since the January 2025 Palisades fire damaged the surrounding retail center, according to Yahoo Entertainment.
What is changing at the theater
Under the new arrangement, Paramount — now part of the newly formed Skydance company following its October 2026 acquisition of Warner Bros. Discovery — has partnered with Caruso to restore and reopen the venue. Day-to-day operation will be handled by The Lot, a La Jolla-based luxury dine-in cinema chain that runs four locations in California, Yahoo Entertainment reported.
The reopened theater is planned to show first-run releases from all studios, not only Paramount titles, alongside repertory screenings and special programming. Reported plans include upgraded projection systems and in-seat food and drink service. A specific reopening date within 2026 has not yet been announced.
From Cinépolis to Netflix to Paramount
The current five-screen Bay Theater opened in 2018 inside Palisades Village, with signage designed as a tribute to a 1940s theater that previously stood on the site, according to a 2021 press release from Caruso's company. The venue reopened under a Netflix partnership on October 22, 2021, with Netflix using it for special events, classic-film screenings and theatrical releases.
The theater, along with the rest of Palisades Village, closed after the January 2025 Palisades fire. The shopping center itself reopened in August 2026 following more than $100 million in renovations addressing fire-related damage and contamination, Yahoo Entertainment reported, setting the stage for the theater announcement.
Why a studio can own a theater again
For over 70 years, major film studios were barred from owning movie theaters under the 1948 Paramount consent decrees, which followed the U.S. Supreme Court's antitrust ruling in United States v. Paramount Pictures, Inc. and forced the largest studios to divest their theater chains. A federal judge in the Southern District of New York formally terminated the decrees on August 7, 2020, clearing the legal path for studios to acquire or operate cinemas again, according to LegalClarity and the Wikipedia summary of the case.
Yahoo Entertainment reported that Caruso raised the idea of reopening the Bay Theater with Skydance chief executive David Ellison during a lunch meeting last year while Ellison was working to acquire Paramount, with the two discussing Ellison's views on the importance of the movie theater business.
| Year | Development |
|---|---|
| 2018 | Five-screen Bay Theater opens inside Palisades Village |
| 2021 | Netflix becomes lease operator; theater reopens Oct. 22, 2021 |
| Jan. 2025 | Palisades fire forces closure of theater and shopping center |
| Aug. 2026 | Palisades Village reopens after $100M+ in renovations |
| Oct. 2026 | Paramount/Skydance completes Warner Bros. Discovery deal |
| 2026 | Paramount takes over Bay Theater lease; reopening planned |
This theater has always meant more than movies alone – it's woven into the fabric of this neighborhood, and helping restore it is a privilege.
What is not yet known
- No exact reopening date has been set; Yahoo Entertainment reported it will come "later in 2026."
- Financial terms of the lease transfer from Netflix to Paramount have not been disclosed.
- It is not yet confirmed whether Paramount will seek additional theater acquisitions beyond the Bay Theater.
Questions
- Who operated the Bay Theater before Paramount?
- Netflix held the lease and operated the Bay Theater starting in 2021, after the venue reopened under a Netflix-Caruso partnership on October 22, 2021.
- Why was the Bay Theater closed?
- The theater closed after the January 2025 Palisades fire damaged Palisades Village, the Caruso-developed shopping center where it is located; the center reopened in August 2026 after more than $100 million in renovations.
- Who will run the theater day to day?
- The Lot, a La Jolla-based luxury dine-in cinema chain with four California locations, has been selected to operate the Bay Theater once it reopens, according to Yahoo Entertainment.
- Is it legal for a studio to own a movie theater?
- Yes. Studios were barred from owning theaters under the 1948 Paramount consent decrees, but a federal judge terminated those decrees on August 7, 2020, allowing studios to acquire or operate cinemas again.
- When will the Bay Theater reopen?
- Reports indicate a reopening later in 2026, but neither Paramount nor Caruso had announced a specific date as of mid-October 2026.
Sources
- Yahoo Entertainment — Paramount takes over Netflix's Bay Theater in Pacific Palisades, plans reopening
- Yahoo Entertainment — Paramount, Caruso to reopen Bay Theater
- Yahoo News UK — The Bay Theater in Palisades Village, closed since the LA wildfires, will reopen thanks to Paramount and Rick Caruso
- Caruso — Los Angeles' Iconic Bay Theater in Pacific Palisades Re-opened by Netflix (2021 press release)
- LegalClarity — The Paramount Decree: History, Impact, and Termination
- Wikipedia — United States v. Paramount Pictures, Inc.
This piece was prepared with artificial intelligence and passed an automated source check before publication. If you see an error, ask for a correction. Request a correction or reply · How we make this
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