Live Nation to be sued by US Justice Department over violation of antitrust laws

Live Nation, the parent company of Ticketmaster, is reportedly set to face an antitrust lawsuit from the US Justice Department as soon as next month.

The story was first reported in the Wall Street Journal, with the suit set to allege that the company’s concert promotion and ticketing operations have undermined competition in the live music industry.

The report claims that since the 2010 merger of Live Nation and Ticketmaster, the enterprise has gone on to control more than 80 per cent of the market for ticket sales in the US. The Journal reports that issues covered by the suit will include unfair market leverage, high transaction fees and flawed customer service.

In response to the report, Live Nation’s head of corporate affairs, Dan Wall, argued that the company in fact has more competition than ever. “If you have to hone in on one slice of the market in order to allege a monopoly, then there isn’t one,” he said.

Ticketmaster (Photo Illustration by Mateusz Slodkowski/SOPA Images/LightRocket)

Last February, a previous antitrust lawsuit that had been filed against Live Nation was thrown out by a federal appeals court after it was ruled that buyers had waived their right to sue.

A class action suit had been filed on behalf of “hundreds of thousands, if not millions” of customers in April 2020, claiming that Live Nation was a “monster [that] must be stopped”, before being dismissed by the court of appeals.

Ticketmaster faced high-profile controversy in late 2022 after well-publicised issues surrounding the ticket sales for Taylor Swift’s ‘Eras Tour’. The company said there had been “historically unprecedented demand” for the concerts.

As well as US lawmakers calling for an investigation into the company as a result, two US senators urged the Federal Trade Commission (FTC) to answer for “the steps” it was taking to “combat the use and operation of bots in the online ticket marketplace”.

Some fans of Swift later filed a class action lawsuit against Ticketmaster, with plaintiffs accusing the company of violating two laws – the California Cartwright Act and the California Unfair Competition Law – during the first Verified Fan pre-sale. Live Nation president Joe Berchtold blamed cyber attacks for the sale issues. The main plaintiff in that case dropped the suit in December 2023, with both sides “agreeing to continue their ongoing settlement discussions through mediation.”

Furthermore, last May, Live Nation CEO Michael Rapino was forced to address another controversy surrounding sales for The Cure’s 2023 North American tour.

In a bid to keep costs down for fans, the band had opted out of Ticketmaster’s dynamic pricing scheme, which frontman Robert Smith said was “a bit of a scam”, and they restricted ticket transfers in states where they were legally allowed to do so. But some fans attempting to buy tickets reported that Ticketmaster fees (including service fee, facility charge and order processing fee) exceeded the price of actual tickets, with Smith saying he was “sickened” by this.

Rapino responded by saying: “There was a screenshot of a venue, which wasn’t even a Live Nation venue… that showed a ticket service fee of $20 on $20. It doesn’t matter whether justifying the service fee is a good idea or not, we have an industry where we have to build some credibility back.

Music Venue stock image. CREDIT: Jena Ardell/Getty Images

“I couldn’t defend in any version that we were going to add a $20 service fee to a $20 ticket. We made a decision that we would spend some money, give back the $10, and get it to a reasonable place for those fans.”

When asked whether he thought it was reasonable to expect to see The Cure in an arena for $20, he replied, “No”, adding: “I think the pricing of concerts in general – there’s this fine line between, yes, we want it accessible, and it’s a fine art and there’s a price to it.”

He argued that fans are willing to pay high prices, even those inflated by dynamic pricing, because they see “concerts as a really special moment in their life.”

Meanwhile, Live Nation reported 2023 to have been its most successful ever commercial year. In its end of year report, published in February, the company stated that it sold 620million tickets, a 13 per cent increase on the previous year. Its revenue also increased by 32 per cent to nearly $3billion (£2.4billion).

Their total revenue jumped 36 per cent to $22.7billion (£18.2billion), while operation income rose by 46 per cent to $1.07billion (£860million).

Live Nation’s success comes amid a recent report from the Music Venue Trust (MVT) that outlined the “disaster” that struck the UK’s grassroots venues over the same period.

The findings revealed that 125 UK venues abandoned live music in 2023 (approximately two per week) and that over half of them had shut entirely.

Responding to Live Nation’s 2023 report, the Trust’s CEO Mark Davyd said that “all 125” of the affected grassroots venues “could have been saved for somewhere in the region of £3million; about $3.8million. That’s just 0.06 per cent of Live Nation’s additional revenue this year.

“Not their total revenue, their additional revenue. That is the additional revenue Live Nation made in the year those venues closed down […] And even if you show them these maths they still insist that a sustainable grassroots sector is an unaffordable financial burden on the industry.”

In response to the crisis, music industry figures argued for a £1 ticket levy for all arena-sized gigs and above during a recent UK Parliamentary session, in order to secure the future of grassroots venues and artists.

The post Live Nation to be sued by US Justice Department over violation of antitrust laws appeared first on NME.

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