An old-style movie theatre in Metro Circle that shows black and white reel-to-reel film through a projector - "like in the Middle Ages" as Zack Lee says; owned by Dottie Mellon and maintained by her simple, yet somewhat sinister son Freddie. When April goes there looking for Cortez, the Mercury has both Casablanca and The Maltese Falcon (which April thinks is a Disney movie with singing mice) on its marquee. There are several posters on the theatre as well; one is for A Welsh Ghost Story by Ragnar Tørnquist, which April claims is a classic. Another is for a film called Women In Dire Need of Medical Attention - April suspected this was porn, then guesses it's just a very artsy foreign film. A third poster advertises a Bergman festival which opens on Tuesday; April likes the look of it and considers going.
While Freddie Mellon sweeps up outside the Mercury, April meets Newport's most conspicuous undercover cop, Frank Minelli, who, as it later emerges, was waiting for Cortez at the command of the Vanguard. In fact, Cortez is hiding inside watching an old movie called Victory Hotel (created for the game). When April finally manages to get inside, Cortez tells her that he doesn't really like modern movies much, "too loud and expensive or too obscure and selfindulgent. But old movies - really old movies have a charm and simplicity that appeals to me." It seems he is a regular patron of the Mercury.
The Mercury Theatre was the name of the theatre company founded by Orson Welles. It eventually grew to Mercury Theatre On The Air, the radio show that hosted Welles' famous 1938 'War of the Worlds' broadcast. This broadcast caused panic as listeners thought they were listening to a news account of an alien invasion.
April's description of Casablanca involves a couple adopting a baby leopard, a possible reference to Bringing Up Baby.