Justice Dept. Sues Live Nation Alleging Antitrust in Ticket Sales
NEW YORK — The Justice Department sued concert promoter Live Nation Thursday in one of the biggest antitrust enforcement actions of the Biden administration.
The lawsuit accuses Live Nation and its Ticketmaster unit of inflating ticket prices and providing customers with poor service.
Live Nation controls about half the market for concert promotion. Ticketmaster dominates ticket sales in the nation’s biggest venues with more than 80% of the market share.
“It’s time to break up Live Nation,” U.S. Attorney General Merrick Garland said in a statement.
The lawsuit was filed in federal court in New York and joined by 30 states and the District of Columbia.
The Justice Department accuses Live Nation of using its near monopoly power to trample competition and to retaliate against competing concert promoters.
Live Nation’s market dominance is largely a result of a $2.5 billion merger in 2010 between Ticketmaster Entertainment Inc. and Live Nation Inc.
At the time, antitrust regulators assured critics the merger would provide benefits to consumers as a result of conditions they placed on the deal.
The merged company was required to sell some of its assets and to license parts of its software to a competitor. Live Nation also was prohibited from retaliating against concert venues that used competing ticketing providers.
The complaints from consumers started shortly after the merger and culminated in late 2022 with a glitch by Ticketmaster for sales to Taylor Swift’s “Eras Tour.”
Ticketmaster was forced to cancel ticket sales for what it said was “extraordinarily high demands on ticketing systems and insufficient remaining ticket inventory to meet that demand.”
On Nov. 15, 2022 — the opening day of ticket sales — Ticketmaster sold more than 2 million tickets to the “Eras Tour” with 3.5 billion system requests.
The problem was exacerbated by scalpers who used bots to purchase large numbers of tickets that they resold at higher prices and by fans who tried to purchase tickets from the Ticketmaster website without registering in advance.
Fans who sued said Ticketmaster could have foreseen the problems and taken measures to manage the demand but did not prepare adequately because they lacked the incentive of market competition.
The Justice Department made similar allegations in its lawsuit filed Thursday. It also said Live Nation violated conditions of its 2010 merger.
“The result is that fans pay more in fees, artists have fewer opportunities to play concerts, smaller promoters get squeezed out, and venues have fewer real choices for ticketing services,” a Justice Department statement said.
Ticketmaster said the lawsuit would not resolve problems that contribute to consumers’ complaints about prices and access to high-demand shows. It mentioned scalpers as one of the problems.
“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,” the company said in a statement.
Ticketmaster said it would use its defense against the lawsuit as an “opportunity to shed light on the industry, and continue to push for reforms that truly protect consumers and artists.”
The lawsuit continues what President Joe Biden pledged shortly after getting elected would be an aggressive policy of antitrust enforcement to ensure competition in a wide range of industries, such as large technology companies and health care.
Other recent Justice Department antitrust lawsuits were filed against Apple, Amazon, Facebook and Google.
Sen. Amy Klobuchar, D-Minn., who presided over a January 2023 Senate hearing into consolidations in the ticketing industry, said in a statement Thursday that she supported the Justice Department lawsuit against Live Nation.
“The hidden fees, the messed up processes, and the stranglehold on competition has long hurt fans,” Klobuchar said. “As a result, the live event entertainment experience has become increasingly out of reach for many Americans.”
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