People ex rel. Zvirin v. Roxy Theatre, Inc. (8 NYS2d 92 [Magistrate's Ct. 7th Dist 1938]), involved a prosecution under then Penal Law § 421 for making an untrue and misleading advertisement as to the cost of admission to a movie theatre.
The Court held that when the theatre was full, it was free to stop selling tickets at the low advertised price.
Despite stating in dicta that "a theatre does not sell merchandise nor render service," the holding actually analyzes the theater's activities in terms of both rendering a service and selling articles:
It would introduce the assumption that he had from the moment of advertising relinquished his rights over his property, bound it over at a stated price to the public which, at its whim, might or might not buy, and prevented himself even from disposing of his business as a going whole to another or had similarly relinquished his freedom to decline to render service, all at the peril of the penal law for a refusal to sell or serve. The mischiefs of such a law would be infinite. Again, would it rest with the customer alone to say how many of the advertised articles the advertiser would be compelled to sell to him? (id. at 97-98)