The Justice Department on Thursday sued Live Nation Entertainment, the concert giant that owns Ticketmaster, asking a court to break up the company over allegations that it illegally maintained a monopoly in the live entertainment industry.
In the lawsuit, joined by 29 states and the District of Columbia, the government accuses Live Nation of dominating the industry by locking venues into exclusive ticketing contracts, pressuring artists to use its services and threatening its rivals with retribution. financial.
These tactics, the government argues, have resulted in higher ticket prices for consumers and stifled innovation and competition across the industry.
“It is time to break up Live Nation-Ticketmaster,” Merrick Garland, the attorney general, said in a statement announcing the lawsuit, which was filed in the U.S. District Court for the Southern District of New York. The lawsuit asks the court to order “the divestment of, at a minimum, Ticketmaster” and prevent Live Nation from engaging in anti-competitive practices.
The lawsuit is a direct challenge to the business of Live Nation, an entertainment industry colossus and a force in the lives of musicians and fans. The case, filed 14 years after the government approved the merger of Live Nation and Ticketmaster, has the potential to transform the multibillion-dollar concert industry.
Live Nation’s scale and reach far exceed that of any competitor, encompassing concert promotion, ticket sales, artist management and operation of hundreds of venues and festivals around the world.
According to the Department of Justice, Live Nation controls about 60% of concert promotions at major U.S. venues and about 80% of primary ticket sales at major concert venues.
Lawmakers, fans and competitors have accused the company of engaging in practices that harm rivals and increase ticket prices and fees. At a congressional hearing early last year prompted by a Ticketmaster pre-sale of Taylor Swift’s tour that left millions of people unable to buy tickets, senators from both parties called Live Nation a monopoly.
In its complaint, the Justice Department refers to the many additional fees as “essentially a ‘Ticketmaster tax’ that ultimately increases the price fans pay.”
In response to the lawsuit, Live Nation denied that it was a monopoly and said that its dissolution would not result in lower ticket prices or fees. According to the company, artists and sports teams are primarily responsible for setting ticket prices, and other business partners, such as venues, take the lion’s share of the surcharges.
In a statement, Dan Wall, Live Nation’s executive vice president of corporate and regulatory affairs, said the Justice Department’s lawsuit followed “intense political pressure.”
The government’s case, Wall added, “ignores everything that is actually responsible for rising ticket prices, from rising production costs to the popularity of artists to 24/7 online ticket scalping. week, which reveals the public’s willingness to pay much more than the main cost of tickets. ”
The company also says its ticket market share has declined in recent years as it competes with rivals to win business.
In recent years, American regulators have sued other big companies, testing centuries-old antitrust laws against the new power big companies wield over consumers. The Justice Department sued Apple in March, arguing that the company made it difficult for customers to abandon their devices, and has already filed two cases arguing that Google violated antitrust laws. The Federal Trade Commission last year filed an antitrust lawsuit against Amazon for harming sellers on its platform and is filing another against Meta, in part over its acquisitions of Instagram, Facebook and WhatsApp.
The Justice Department allowed Live Nation, the world’s largest concert promoter, to buy Ticketmaster in 2010 under certain conditions set out in a legal agreement. If venues didn’t use Ticketmaster, for example, Live Nation couldn’t threaten to cancel tours.
In 2019, however, the Department of Justice concluded that Live Nation violated these terms and modified and extended its agreement with the company.
The Justice Department argued in its court filing that it provided to The New York Times that Live Nation exploited relationships with partners to keep competitors out of the market. Request a jury trial.
The government’s complaint argued that Live Nation threatened venues with losing access to popular tours if they didn’t use Ticketmaster. That threat could be explicit or simply an implication communicated through intermediaries, the government said, adding that it could also prevent artists who don’t work with the company from using its venues.
Additionally, Live Nation acquired a number of smaller companies — something Live Nation described in internal documents as eliminating its biggest threats, according to the government.
The Justice Department accused Live Nation of anticompetitive behavior with Oak View Group, an events company co-founded by Live Nation’s former chief executive. Oak View Group avoided bidding against Live Nation when it came to working with artists and influenced concert halls to sign deals with Ticketmaster, the government argues.
In 2016, Live Nation’s chief executive complained in an email that Oak View Group had offered to promote an artist who had previously worked with Live Nation. Oak View Group backed out, according to the government.
“Our people have made some progress,” the company’s chief executive responded via email, according to the government. “Everyone knows we don’t promote and only tour with Live Nation.”
The Justice Department’s latest investigation into Live Nation began in 2022. Live Nation has simultaneously stepped up its lobbying efforts, spending $2.4 million on federal lobbying in 2023, up from $1.1 million in 2022, from according to records available on the nonpartisan website OpenSecrets.
In April, the company co-hosted a lavish party in Washington before the annual White House Correspondents’ Association dinner, which featured a performance by country singer Jelly Roll and napkins displaying positive facts about Live Nation’s impact on the economy, like the billions he says he pays to artists.
Under pressure from the White House, Live Nation said in June it would begin showing prices for shows at venues it owns, including all charges, including extra fees. The Federal Trade Commission has proposed a rule that would ban hidden fees.
A former commission chairman, Bill Kovacic, said Wednesday that a lawsuit against the company would be a rebuke to previous antitrust authorities who allowed the company to grow to its current size.
“It’s another way of saying that the previous policy failed and failed badly,” he said.
