Washington The Department of Justice filed a federal lawsuit Thursday alleging that Ticketmaster and its parent company, Live Nation, are illegally monopolizing the live entertainment industry to the detriment of both concertgoers and artists.
In a 128-page civil lawsuit filed in the U.S. District Court for the Southern District of New York, federal officials allege that Live Nation has unlawfully stifled competition through its ownership of Ticketmaster, imposing undue burdens on consumers and effectively giving Ticketmaster too much control over the live entertainment market.
Justice Department officials said Thursday they are seeking structural changes to the way the company operates, which could include separating the two companies.
Attorney General Merrick Garland announced the lawsuit at the Justice Department and revealed the charges at the heart of the case.
“We allege that for too long, Live Nation has illegally monopolized the entire market for live concerts in the United States,” Garland said. “It’s time to break it up.”
In 2022, Ticketmaster’s Taylor Swift’s “The Eras Tour” ticket sales fraud The move sparked a public outcry over Live Nation’s influence over the entertainment and ticketing industries, and CBS News previously reported that the Department of Justice’s antitrust division was already investigating the company at the time of the Swift debacle.
Litigation
According to the complaint, Live Nation owns more than 250 venues and controls approximately 60 percent of concert promotions at major venues nationwide. The company also distributes approximately 80 percent of major entertainment ticket sales through Ticketmaster.
The federal lawsuit, which also included 29 states and the District of Columbia, alleges that the entertainment giant has established what regulators call a “self-reinforcing ‘flywheel,'” targeting various businesses in order to collect all associated fees. They accused the company of using factors to stifle innovation in the industry. along with the concert.
The suit says the flywheel allows the company to charge customers fees and use the revenue to attract major artists and sign them into long-term contracts to sell more tickets.
Department of Justice
“Live Nation’s monopoly, and the anticompetitive conduct that protects and maintains that monopoly, is the very industry in question that has inspired, entertained, and challenged Americans for generations. “This resonates with us because we are in the industry,” the complaint states. “Anti-competitive practices here not only harm the fabric of the live music industry and the countless people who work in it, but also harm the creation that is at the center of our personal, social and political lives. It also damages the foundations of artistic expression and the arts.”
In 2010, federal regulators, including the Department of Justice, approved the merger of Live Nation and Ticketmaster, finally bringing the promotion, venue, and ticketing industries under one company’s control.
But Thursday’s lawsuit alleges that the relationship harms American consumers and creates obstacles for artists. Justice Department officials allege that Live Nation and Ticketmaster, through monopoly middlemen, illegally sought to squeeze money out of consumers even after artists had been paid.
According to the complaint, Live Nation has imposed financial retaliation on companies that do business with competitors and has threatened to cancel future events for venues that decide not to use Ticketmaster exclusively. It is said that it is in control.
The Justice Department said such restrictions would result in concertgoers paying more for tickets and touring artists entering into long-term contracts to perform only at venues that take advantage of ticket sales programs.
Live Nation said in a statement that the lawsuit “does not resolve the issues fans care about, including ticket prices, service fees, and access to popular shows.” The company is “[c]”Giving Ticketmaster a monopoly might be good for PR for the Department of Justice in the short term, but it would lose in court because it ignores the basic economics of live entertainment,” he said, noting that “competition has steadily eroded Ticketmaster’s market share and profit margins.”
“We will defend ourselves against these baseless allegations and use this opportunity to shine a light on our industry and push for reforms that truly protect consumers and artists,” Live Nation said.
At a Senate hearing in January 2023, the artists testified Regarding the influence Live Nation has over them, Clyde Lawrence of the band Lawrence testified that Live Nation’s power comes from the fact that they are the promoter, venue and ticket company.
“Live Nation owns the venues, pays for the shows and sells the tickets, so they have extraordinary power when negotiating with artists,” he said, citing an example during the panel discussion. Ta. For one show, Lawrence set the ticket price at $30. Fans paid him $42 per ticket after Ticketmaster added his 40% handling fee. And after paying equipment costs, the band made $12 per ticket. About half of that went to covering the cost of the tour.
