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The U.S. Justice Department and almost 30 states sued Live Nation Entertainment seeking to force the company to sell off ticketing giant Ticketmaster.
In a complaint filed Thursday in New York federal court, antitrust enforcers alleged that Live Nation and Ticketmaster illegally monopolized the live events industry by engaging in a variety of anticompetitive practices. Those include locking venues into long-term exclusive contracts and retaliating against rivals and venues that seek to use alternatives.
Shares of Live Nation were down 5.5% to $95.84 at 11:05 a.m. in New York, shortly after the lawsuit was filed.
The suit was first reported by Bloomberg.
‘No other options’
Live Nation controls more than 265 concert venues in North America and manages more than 400 musical artists, according to the Justice Department. Overall, Live Nation controls at least 80% of major concert venues’ ticketing for concerts. The Justice Department said that has led fans to pay more in fees because “there are no other options.”
Live venues fear they will lose concerts and revenue if they don’t work with Ticketmaster, according to the Justice Department.
“It is well understood across the live concert industry, as a result of Live Nation’s historical conduct and exactly as Live Nation intended, that choosing ticketers other than Ticketmaster carries enormous risk and financial pain,” the Justice Department said in the complaint.
Live Nation said it would defend itself against the suit’s “baseless allegations.”
“The DOJ’s lawsuit won’t solve the issues fans care about relating to ticket prices, service fees, and access to in-demand shows,” the company said in a statement. “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, such as the fact that the bulk of service fees go to venues, and that competition has steadily eroded Ticketmaster’s market share and profit margin.”
Broader conduct
Live Nation exerts control at every level of the live music ecosystem and needs to be broken apart for competition to flourish, senior Justice Department officials said. They declined to offer a figure for how much consumers were allegedly overcharged, saying that would be determined later in the litigation.
Antitrust enforcers allowed Live Nation and Ticketmaster to merge in 2010 subject to conditions. But that prior consent decree, “which addressed a claim different from those at issue here,” has “failed to restrain Live Nation and Ticketmaster from violating other antitrust laws in increasingly serious ways,” the Justice Department said in its complaint.
The conduct at issue in the current case is broader, more recent and involves additional markets, said people familiar with the matter who asked not to be named discussing the department’s thinking.
The suit is the fourth major monopolization case being pursued by the Justice Department’s antitrust unit, along with twin cases against Google and a lawsuit filed earlier this year against Apple.
A bipartisan group of states and territories joined the complaint, including Texas, Florida, California, New York and Washington, D.C.
Rocky history
Ticketmaster, the largest ticketing company in the U.S., merged with Live Nation, the biggest concert promoter, 14 years ago following a lengthy antitrust investigation. The Justice Department required the combined company to pledge that it wouldn’t tie its services together or retaliate against venues that switched promoters or ticketing services.
In 2019, the Justice Department alleged that the company had violated that promise and entered a new settlement imposing an external monitor to ensure compliance and investigate any further disputes.
The Biden administration opened a new antitrust probe into the company that has garnered widespread public interest after Ticketmaster bungled the massive demand for Taylor Swift tickets in 2022.
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Leah Nylen and Emily Birnbaum, Bloomberg , 2024-05-23 20:01:33
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