Justice Department sues Live Nation and Ticketmaster for monopolizing the concert industry

Washington — The Department of Justice filed a federal lawsuit Thursday. ticket master and its parent company Live Nation have an illegal monopoly on the live entertainment industry to the detriment of both concert goers and artists.

in 128 pages of civil litigation In the lawsuit filed in the U.S. District Court for the Southern District of New York, federal authorities allege that Live Nation, through its ownership of Ticketmaster, has illegally stifled competition, imposed undue burdens on consumers and effectively controlled a large portion of the live entertainment market.

Justice Department officials said Thursday they are seeking structural changes to how the company operates, which could include separating the two companies.

In 2022, Ticketmaster’s Taylor Swift’s The Eras Tour Ticket Sales Mishandling It sparked a public outcry against Live Nation’s influence in the entertainment and ticketing industry. CBS News previously reported that the Justice Department’s antitrust division was already investigating the company at the time of the Swift scandal.

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Attorney General Merrick Garland announced the lawsuit at the Justice Department and revealed the charges at the heart of the complaint.

Garland, who is known as a Swift fan, said: “For far too long, Live Nation has illegally monopolized the entire U.S. live concert industry. It’s time to dismantle it. I’m ready for that.”Not-so-subtle nod one of her songs.

The federal lawsuit, joined by 29 states and the District of Columbia, alleges that the entertainment giant uses various business elements to collect all fees associated with its concerts, creating what authorities call a “self-reinforcing ‘flywheel.'” They accused the company of stifling innovation in the industry by building

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.

“Live Nation’s monopoly, and the anticompetitive conduct that protects and maintains that monopoly, resonates precisely because the industry at issue is one that has inspired, entertained, and challenged Americans for generations,” the lawsuit states. “Its anticompetitive conduct not only harms the very fabric of the live music industry and the countless people who work in it, but also the foundations of creative expression and the arts that are at the heart of our personal, social, and political lives.”

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.

The lawsuit alleges that Live Nation exerts control over the market by exacting financial retaliation against companies that do business with competitors and threatening to cancel future events for venues that decide not to use Ticketmaster exclusively.

According to the Justice Department, these regulations have resulted in concertgoers paying higher prices for tickets and touring artists entering into long-term contracts to perform only at venues with ticket sales programs. .

Live Nation said in a statement that the lawsuit “does not resolve fan concerns regarding ticket prices, service fees or access to popular programming.” The company is “[c]”While casting Ticketmaster as a monopoly may be a short-term PR win for the Department of Justice, it would lose in court because it ignores the fundamental economics of live entertainment,” he said, noting that “competition has steadily eroded Ticketmaster’s market share and profit margins.”

“We will defend 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 in a statement.

At a Senate hearing in January 2023, the artists testified Regarding the influence that 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 venue, pre-funds the shows, and sells the tickets, so it has extraordinary power in negotiations with artists,” he told the panel, citing an example. For one show, Lawrence set the ticket price at $30. Fans paid $42 a ticket because Ticketmaster added a 40% handling fee. And after paying facility fees, the band made a profit of $12 per ticket. Approximately half of that amount was used for tour expenses.

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• live nation
• Taylor Swift
• U.S. Department of Justice
• Ticketmaster