US Justice Department sues Ticketmaster and Live Nation over ‘illegal monopoly’

23 May 2024, 21:54

Ticketmaster Antitrust Lawsuit
Ticketmaster Antitrust Lawsuit. Picture: PA

The lawsuit, filed in federal court in Manhattan, was being brought with 30 state and district attorneys general.

The US Justice Department filed a sweeping antitrust lawsuit against Ticketmaster and parent company Live Nation Entertainment on Thursday, accusing them of running an illegal monopoly over live events in America — crushing competition and driving up prices for fans.

The lawsuit, filed in federal court in Manhattan, was being brought with 30 state and district attorneys general and seeks to break up the “monopoly” they say is squeezing out smaller promoters and hurting artists.

“We allege that Live Nation relies on unlawful, anticompetitive conduct to exercise its monopolistic control over the live events industry in the United States at the cost of fans, artists, smaller promoters, and venue operators,” attorney general Merrick Garland said in a statement.

“The result is that fans pay more in fees, artists have fewer opportunities to play concerts, smaller promoters get squeezed out, and venues have fewer real choices for ticketing services. It is time to break up Live Nation-Ticketmaster.”

Ticket Master Antitrust Lawsuit
The headquarters of Live Nation in Beverly Hills, California (Mark J Terrill/AP)

The Justice Department accuses Live Nation of a slew of practices that allow it to maintain a stronghold over the live music scene, including using long-term contracts to keep venues from choosing rival ticketers, blocking venues from using multiple ticket sellers and threatening venues that they could lose money and fans if they do not choose Ticketmaster.

The Justice Department says Live Nation also threatened to retaliate against one firm if it did not stop a subsidiary from competing for artist promotion contracts.

“Live music should not be available only to those who can afford to pay the Ticketmaster tax,” said assistant attorney general Jonathan Kanter of the Justice Department’s Antitrust Division.

“We are here today to fight for competition so that we can reopen the doors to the live music industry for all.”

Live Nation has denied that it engages in practices that violate antitrust laws.

When it was reported that the company was under federal investigation in 2022, the concert promoter said in a statement that Ticketmaster enjoys a such a large share of the market because of “the large gap that exists between the quality of the Ticketmaster system and the next best primary ticketing system”.

But competitor ticket sellers have long complained that Live Nation makes it difficult for them to disrupt the market with practices such as withholding acts if those venues do not agree to use Ticketmaster’s service.

The lawsuit is the latest example of the Biden administration’s aggressive antitrust enforcement approach targeting companies accused of engaging in illegal monopolies that box out competitors and drive up prices.

Ticket Master Antitrust Lawsuit
The ticket seller sparked outrage in November 2022 when its site crashed during a presale event for a Taylor Swift stadium tour (Lewis Joly/AP)

In March, the Justice Department filed a lawsuit against Apple alleging that the tech giant has monopoly power in the smartphone market. The Democratic administration has also taken on Google, Amazon and other tech giants.

“Today’s action is a step forward in making this era of live music more accessible for the fans, the artists, and the industry that supports them,” deputy attorney general Lisa Monaco said in a statement.

Michael Carrier, a professor at Rutgers Law School who specialises in antitrust litigation, said the Justice Department has a strong case. He expects Live Nation to “try to cast blame elsewhere” such as arguing that prices are set by artists or venues, but he said those explanations are weak.

“The DOJ showed how Live Nation really has its tentacles in each element of the supply chain, which means that it has a lot more control than it is letting on,” he said. “And, in terms of justifications, there is really very little that (Live Nation) can offer in terms of how they’re helping the consumer.”

A breakup between Live Nation and Ticketmaster is possible, Mr Carrier said. That, combined with other remedies such as preventing some exclusive deals that shackle competition, could potentially help fans see lower ticket prices, give artists more agency in choosing venues and boost smaller promoters’ success in the long run, he said.

Ticketmaster, which merged with Live Nation in 2010, is the world’s largest ticket seller, processing 500 million tickets each year in more than 30 countries. Around 70% of tickets for major concert venues in the US are sold through Ticketmaster, according to data in a federal lawsuit filed by consumers in 2022.

The company owns or controls more than 265 of North America’s concert venues and dozens of top amphitheatres, according to the Justice Department.

The ticket seller sparked outrage in November 2022 when its site crashed during a presale event for a Taylor Swift stadium tour. The company said its site was overwhelmed by both fans and attacks from bots, which were posing as consumers to scoop up tickets and sell them on secondary sites.

The debacle prompted congressional hearings and bills in state legislatures aimed at better protecting consumers.

The Justice Department allowed Live Nation and Ticketmaster to merge as long as Live Nation agreed not to retaliate against concert venues for using other ticket companies for 10 years.

In 2019, the department investigated and found that Live Nation had “repeatedly” violated that agreement and extended the prohibition on retaliating against concert venues to 2025.

Live Nation said on Thursday that the Justice Department’s lawsuit “won’t solve the issues fans care about relating to ticket prices, service fees, and access to in-demand shows”.

Live Nation added that “calling Ticketmaster a monopoly may be a PR win for the DOJ in the short term, but it will lose in court because it ignores the basic economics of live entertainment” — stating that most service fees go to venues.

The company said it would defend itself “against these baseless allegations” and push for other reforms.

By Press Association

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