The US Department of Justice files a severance suit Living Nation, parent company Ticketmaster in connection with alleged violations of antitrust law.
The lawsuit, joined by 30 states and filed Thursday, follows a Justice Department investigation into whether Live Nation maintains a monopoly in the ticketing industry. The investigation began in 2022 and was bolstered by fan complaints over the botched ticket sales for Taylor Swift’s Eras tour.
“We allege that Live Nation relies on unlawful, anticompetitive conduct to exercise its monopoly control over the U.S. live events industry at the expense of fans, artists, smaller promoters and venue operators,” Attorney General Merrick Garland said in a statement. “As a result, fans pay more in fees, artists have fewer opportunities to play shows, smaller promoters are eliminated and venues have less choice in ticketing. It is time to part ways with Live Nation-Ticketmaster.”
Live Nation shares fell 5% on Thursday morning.
In a statement, Live Nation said Justice Department’s monopoly allegations are ‘absurd’.
“The Department of Justice’s complaint attempts to portray Live Nation and Ticketmaster as the causes of fan frustration in the live entertainment industry. He blames the high ticket prices on concert promoters and ticket selling companies – none of them controls ticket prices. “It ignores everything that is actually responsible for these higher ticket prices, from rising production costs to artist popularity to 24/7 online ticket scalping that reveals audiences’ willingness to pay far more than the original cost of tickets,” said Dan Wall, executive vice president Live Nation Corporate and Regulatory Affairs.
Live Nation and Ticketmaster merged in 2010, creating a dominant entity in the live events industry. According to the Justice Department lawsuit, the company handles and manages ticket sales for live entertainment shows around the world and owns and operates more than 265 entertainment venues in North America, including more than 60 of the world’s top 100 amphitheaters.
The complaint alleges that through Ticketmaster, Live Nation controls approximately 80% or more of prime concert tickets at major venues.
The Department of Justice lawsuit filed in the U.S. District Court for the Southern District of Modern York accuses Live Nation of maintaining a self-perpetuating business model by capturing fees and revenue from concert fans and sponsorships, which it then uses to lock artists into exclusive promotional offers that give artists access to key entertainment venues throughout the country. Live Nation then uses that dominance to tie recent venues to long-term exclusionary contracts, thus starting the cycle all over again, the lawsuit alleges.
Live Nation is also accused of threatening financial retaliation against potential competitors and properties working with rivals; strategic sourcing of smaller and regional competitive threats; and exploiting its relationship with venue partner Oak View Group, handing contracts to the latter to Ticketmaster and discouraging competition in concert promotions.
Live Nation made headlines last year when a surge in demand from 14 million users, including bots, for Taylor Swift concert tickets led to site outages and leisurely lines. A Senate subcommittee issued a subpoena to Live Nation and Ticketmaster in November 2023 following a months-long investigation into the exorbitant overpricing of Swift Eras tour tickets.
High prices for U.S. shows prompted legions of fans to seek out Swift’s tour tickets in other countries, which could often be cheaper even after international air travel.
“Music fans in the United States are deprived of ticketing innovation and forced to apply antiquated technology, paying more for tickets than fans in other countries,” the Department of Justice said in a news release.
Live Nation said Thursday it doesn’t benefit from monopoly pricing, saying Ticketmaster fees “are no higher than elsewhere, and often lower.” The company noted that its overall net profit margin is on the low end of S&P 500 companies.
Live Nation argued that the lawsuit would not reduce ticket prices or service fees. Artist teams were found to set the prices of their tickets and seats and then keep most of the ticket fees.
“Some call it ‘anti-monopoly,’ but in reality it’s just anti-business,” Live Nation’s Wall said. “There is no legal basis to oppose vertical integration for this reason.”
Live Nation earlier this month announced its “biggest first quarter ever” citing first-quarter revenues that increased 21% compared to the prior-year period.
The company came into the public eye last year over transparency issues regarding hidden fees in ticket prices.
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