The St. Joseph Police Department said Josh Hall was released Wednesday, pending further investigation in the case.
He was taken into custody Tuesday after he reported extensive damage inside Screenland Plaza 8 on the North Belt Highway where he worked as a manager.
The theater closed for good on Sunday after approximately 30 years in business. Between Sunday night and Monday morning, the theater was trashed. Ceiling tiles and lighting fixtures were broken and trash was scattered through the building. The facility's bathrooms and a couple of the theaters were also damaged.
Hall told KQ2 Tuesday that he learned of the damage Monday. He described it as "disgusting" and said it looked like "animals" trashed the place.
Police took Hall into custody on an investigative hold for questioning related to making a false police report and property damage.
Capt. Janice Rothganger said detectives are still trying to determine the circumstances surrounding the damage.
The building is set to be demolished as the city discusses future plans for the site with Price Chopper.