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MoviePass Couldn't Afford To Take Members To The Movies Thursday

CHICAGO (CBS)---Going to the movies is more expensive than ever, so it's no wonder why movie subscription service app MoviePass has seen booming success.

That's until this week, when $5 million in debt the company owes left would-be moviegoers out in the cold.

Helios and Matheson, the parent company of the popular movie subscription service, said that it had a service outage on Thursday because it couldn't afford to pay for movie tickets.

Because the company missed a payment to one of its fulfillment processors, the contractor stopped processing payments made to the app.

The company borrowed $5 million in cash Friday to pay its merchant and fulfillment processors.

One disappointed MoviePass user, Megan Walendzinski, told CBS 2's Jeremy Ross she tried unsuccessfully to buy tickets to a show on Thursday night.

The monthly $9.95 fee she pays to use the app for unlimited movies was wasted money because she ended up paying the full ticket price.

"I go to see movies three or four times per month now that I have MoviePass," Walendzinski said, adding that the experience left her frustrated.

MoviePass issued an apology Friday, but left no explanation for why it ran out of money the day before.

"It's a huge red flag," Walendzinski said. "People become very leery of signing up for that company because they're just not sure if they'll be around.

Attorney Karl Leinberger said that consumers would likely continue to be on the hook for their currently monthly fee if the company goes under, but would be able to cancel their future membership.

Members won't be able to wage legal action against the company because MoviePass protected itself in its "terms of use" policy users agreed to when signing up.

The company did not respond to CBS 2's requests for comment.

 

 

 

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