In the wake of the fiasco leaving thousands of Taylor Swift fans without tickets to see their favorite performer, Ticketmaster faces scrutiny from the Department of Justice for alleged questionable business practices. Since its longstanding merger with Live Nation in 2010, many lawmakers have called union the problematic, monopolistic, and are pushing efforts to bust the trust.
“Will the combined company be tempted to divert tickets to the resale market at inflated prices because there are now no competitors to keep this behavior in check?” – this was just one of the questions asked of the two entertainment giants at the 2009 subcommittee hearing on anti-trusts before the merger. David Balto, a lawyer in the Antitrust Division of the DOJ, and music executives joined forces to oppose the merger at the subcommittee hearing in 2009, arguing that anti-competitive behavior would result from the merger of the preeminent ticketing company and the nation’s largest promoter of live shows. Nonetheless, a consent decree allowing the merger was entered in 2010, under several conditions. One such condition was that Live Nation could not use its influence or power to coerce venues into using Ticketmaster as the ticketing platform for its events. The DOJ initiated legal action against Live Nation in late 2019 for allegedly violating the terms of the consent decree. Without any admission of wrongdoing by Live Nation, the DOJ reached a new settlement with the company.
Shortly after recaching the new settlement terms, the Biden Administration came into power and lawmakers saw it as an opportunity to urge for more robust antitrust protections. On July 9, 2021, President Biden entered an Executive Order on Promoting Competition in the American Economy, with the explicit intention of putting an end to the exploitative practices of major conglomerates. With the renewed focus on eliminating monopolistic behaviors, and the reemergence of live programming after Covid-19 restrictions were lifted, consumer frustrations with Ticketmaster’s practices came into the spotlight. Unable to obtain tickets to see their favorite artists in concert, fans put pressure on Ticketmaster to fix their “glitchy” ticketing platform. Ticketmaster issued many apologies in the months leading up to the great Era’s tour debacle, but fans continued to allege that the company did not do much to improve its platform. When the Era’s tour presale crash happened, Ticketmaster publicly stated that the artist’s promotor wanted to partner with Ticketmaster due to its reputation as the best ticket selling platform in the world. However, AEG, Taylor Swift’s promotor, responded that it had no choice but to work with Ticketmaster due to its exclusive ticketing contracts with most of the nation’s largest venues – specifically, Ticketmaster holds more than 80% of the market for primary ticket sales at the largest venues nationwide.
Swift fans have since pursued legal action against Ticketmaster with allegations of exorbitant ticket fees and flawed customer service. Lawmakers, regulators, and attorneys general allege the merger is anticompetitive, looking to purported complaints from venues that fear losing Live Nation concerts should they opt to use a ticketing provider other than Ticketmaster. The DOJ announced that it is preparing to pursue legal action against Live Nation as soon as next month.
The attorneys at Chilivis Grubman represent clients in various types of government investigations and related litigation. If you need help with such a matter, contact us today.