The Celestial Cinema is a theater like no other. The central venue at the recently concluded Maui Film Festival in Hawai'i is outdoors, and patrons sit on the thick grass of Wailea Golf Club to see films projected on a giant screen under a star-filled sky. Each night's festival showing is preceded by an authentic hula performance and a quick astronomy lesson.

It's the perfect place to watch an entertaining comedy like "Little Miss Sunshine," and for a few days last month, Maui festival organizers planned on doing just that.

But Fox Searchlight, the film's distributor, pulled the plug.

The very things that make the open-air Celestial Cinema such a special moviegoing setting also expose it to the possibility of piracy — with about 3,000 film buffs carrying lawn chairs and blankets into the evening showings, there's no sure way for security officers to search everyone and everything. What's more, the venue is so sprawling that guards can't really use night-vision goggles to police the audience and monitor any illegal videotaping or illicit use of camera phones.

Because of that, Fox Searchlight asked that "Little Miss Sunshine" be moved out of a prominent Saturday night showing at the Celestial Cinema and into a smaller indoor venue, where it was seen by only a handful of people.

Hollywood has scoured the globe in search of film thieves, finding them in Los Angeles alleys and Chinese tenements. Although the Motion Picture Association of America says it knows of no instances of piracy occurring at a film festival, studios nevertheless have been clamping down on these nearly weekly events, sometimes going so far as to require that programmers watch films submitted for festival consideration with a security guard always nearby.

"I've had security guards come to my home theater" says Bill Pence, co-director of the Telluride Film Festival in Colorado. Festival piracy, he says, "is an issue. And we take it very seriously."

The MPAA estimates that piracy costs the U.S. entertainment industry $3.5 billion a year. The leading film festivals offer potential pirates tempting fruit. Those festivals (Sundance, Cannes, Toronto, Telluride, Berlin, Venice) tend to show acclaimed films months before their theatrical premieres. Cell phones are rarely confiscated at festival doors; in fact, scores of Sundance Film Festival attendees talk and send e-mails on their mobile devices during screenings. Finally, festival venues are usually run by volunteers, people with little expertise in security.

Barry Rivers, who runs the 7-year-old Maui festival with his wife, Stella, says that although he was disappointed by Fox's decision, he appreciates the gravity of the issue.

"I see it as a very realistic and understandable concern on the part of the studios," Barry Rivers said.

For the outside festival screening, Fox Searchlight substituted its film "Thank You for Smoking," but it wasn't quite the same, as "Smoking" had already been released in April, and "Little Miss Sunshine" doesn't debut until July 26.

For a Celestial Cinema screening of Sony's "Monster House," the festival confiscated the cell phones of about 100 attendees, including that of Rivers' wife. Nevertheless, dozens of festival-goers could be seen using cell phones before the start of the movie. There were no reported piracy incidents.

"Monster House" producer Steve Starkey says he and Sony weighed the possibility of piracy at an outdoor venue against the promotional value of showing the PG-rated haunted-house film to thousands of people. As opposed to Fox Searchlight, they decided to go for it.

One very real issue for studios is the pre-festival selection process, when programmers watch thousands of early and sometimes unfinished copies of films. Some companies won't ship DVD copies of new films via FedEx or UPS (don't even mention the Postal Service). Rather, they have the films hand-delivered, even if that means sending someone in a plane across the country to do nothing more than hand a DVD to a programmer, wait while the movie is seen and grab the next flight home.

Rachel Rosen, director of programming for the just-concluded Los Angeles Film Festival, acknowledged that "awareness of piracy in the climate has changed" the festival experience for movie buffs. In fact, a few studios balked at screening their movies at the L.A. festival's outdoor venue, the John Anson Ford Amphitheatre.

It remains to be seen whether festivals will ramp up security, and possibly copy Telluride's zero-tolerance cell-phone policy.

But what if Sundance and other festivals started barring agents, acquisitions executives and producers from bringing their cell phones into screenings? Would films play to just 20 people?

"The general public is happy enough to sit through a screening without their BlackBerrys," says Lionsgate's Tom Ortenberg. "If forced to, the industry will do the same."