When tens of thousands of Taylor Swift fans were unable to complete their orders for tickets in November for her coming New Eras tour, those legions of devastated Swifties were left with little recourse beyond denouncing Live Nation Entertainment Inc.’s botched online ticket sales process and making tearful TikTok videos. But the company could still suffer plenty of hurt from the fiasco, which has left the US Department of Justice under intense pressure to fix what many say was a mistake in allowing Live Nation and Ticketmaster to merge in 2010. The agency has opened a new antitrust probe into the largest concert promotion and ticketing company, a move that could even be a prelude to a breakup if the company is found to have abused its market power.
“It would certainly be a very hard case,” says David Balto, an antitrust lawyer who testified against the merger before the Senate and has represented Ticketmaster complainants. But “here the facts are clear: Ticketmaster has increased prices and reduced service. Those are the landmarks of anticompetitive conduct by a monopolist.”
A Live Nation Entertainment spokesperson says the company cooperates with ongoing federal oversight of its ticketing business. The company has advocated for Congress to strengthen legislation banning bot purchases of tickets and has urged the Federal Trade Commission to require that ticket sellers display so-called all-in pricing—including the face value of a ticket plus a listing of any fees—as New York state did earlier this year.
Since the 1990s, Ticketmaster has been the subject of multiple federal investigations into its business practices, including one that led to $10 million in fines for illegally spying on a rival and another the appointment of an outside monitor who reports to the Justice Department on the company every few months. In the first case, Ticketmaster agreed to a deferred prosecution agreement and admitted its employees engaged in illegal computer intrusion, wire fraud and conspiracy. Its past behavior will likely play a part in what the DOJ chooses to do next.
Live Nation Entertainment has “become too big to care,” US Federal Trade Commission Chair Lina Khan said at a Dec. 6 business conference in Washington. “There is a certain amount of investment in their services and their products that we don’t see, because they’re not facing that type of robust competition,” said Khan, whose agency enforces consumer protection laws, including one that prohibits bots from buying up large amounts of tickets.
A House panel ordered Ticketmaster parent Live Nation Entertainment to provide details this month on the steps it’s taken to comply with that law, while the Senate is planning a hearing focused on Ticketmaster’s potential antitrust issues for early next year.
Live Nation Entertainment says the problems with the Swift sale resulted from unprecedented demand, not bots. The company notes that only a small fraction of Swift tickets are now being offered for resale.
“We always welcome the opportunity to discuss important issues facing the live entertainment industry,” a Live Nation Entertainment spokesperson says of the congressional inquiries. “The industry is more competitive than ever, but there are many industry reforms that would make the ticketing experience better for fans and artists.”
For almost three decades, Ticketmaster critics have blasted the company as a monopoly and urged intervention on antitrust grounds. Complaints by Seattle rock band Pearl Jam in 1994 sparked an antitrust probe by the Clinton administration, which ended with no action.
Fifteen years later, Live Nation, the largest concert promoter, proposed buying Ticketmaster, the largest ticketing company, reviving antitrust scrutiny. In the time leading up to the deal, the two companies were becoming rivals as Live Nation developed a ticketing service and Ticketmaster acquired a controlling interest in the entertainment promoter that represented Fleetwood Mac, Aerosmith and other acts. When the deal was announced in February 2009, it was viewed as a first test case for the new Obama administration’s approach to antitrust.
Obama’s top antitrust officials were initially eager to challenge the deal, according to three people involved in the probe, who spoke anonymously because they weren’t authorized to discuss internal deliberations. But a lawsuit would’ve been difficult to win. While Live Nation and Ticketmaster were beginning to tread into each other’s territory, they primarily competed in adjacent businesses. US antitrust law generally favors such vertical tieups, as the DOJ would discover in 2018 when it unsuccessfully sought to block AT&T Inc.’s merger with Time Warner Inc.
Not wanting the first major case to be a loss, the DOJ’s antitrust leaders eventually agreed to a settlement, say the three people involved in the probe. The legally binding consent decree required the companies to divest some assets to Comcast Corp. and license software to rival Anschutz Entertainment Group Inc.—both moves that the DOJ hoped would help establish a rival to Ticketmaster. Live Nation and Ticketmaster agreed to be bound by the consent decree to resolve the antitrust complaint.
In a first, the agreement also sought to alleviate concerns that one half of the business might disadvantage rivals of the other half, for example, by leveraging Live Nation’s control over concerts to benefit Ticketmaster. The settlement required the combined company—renamed Live Nation Entertainment—to pledge not to tie its services together or retaliate against venues that switched promoters or ticketing services.
Ticketmaster has also faced charges of corporate espionage against rivals. In August 2013 it hired Stephen Mead after he left a ticketing startup for artists to sell concert tickets directly to fans. For the next two years, Mead and other Ticketmaster employees illegally accessed the startup’s computer systems to collect confidential information, according to Justice Department prosecutors. The corporate spying scheme became public when the now-defunct startup, called Songkick.com Inc., sued Ticketmaster in 2015.
Ticketmaster employees sought to “bring down the hammer” on its smaller rival, Songkick alleged, monitoring weekly which artists were using the startup for ticket sales so Ticketmaster could pressure them to use its service instead. Live Nation Entertainment terminated Mead and his supervisor, Zeeshan Zaidi, in October 2017—when Songkick went out of business—and paid $110 million soon after to resolve the litigation. Because it was a civil antitrust suit, the full terms of the settlement beyond the compensation were not made public.
“Ticketmaster put them out of business,” says Adam Wolfson, a lawyer who represented Songkick. They “squashed the competition.”
Regarding the lawsuit’s resolution, Ticketmaster in a statement said it was “pleased that we were able to resolve this dispute and avoid protracted and costly legal proceedings.”
Federal prosecutors opened a cybercrime investigation following Songkick’s lawsuit. Zaidi, who headed Ticketmaster’s Artist Services division, pleaded guilty to computer fraud charges in October 2018. Lawyers for Zaidi, who’s yet to be sentenced after a series of requests for continuances by the government, didn’t respond to a request for comment. Mead, who was never publicly charged and now lives in London, also didn’t respond to a request sent via LinkedIn.
In the final days of the Trump administration, Ticketmaster paid a $10 million fine and agreed to a settlement acknowledging the criminal activity and promising to improve compliance. That deferred prosecution deal will see Ticketmaster’s own computer fraud and conspiracy charges dismissed in December 2023 if the company doesn’t further violate the law.
“Two Ticketmaster employees violated company policy, for which they were fired and prosecuted. That has nothing to do with antitrust or competition in the ticketing industry,” says Dan Wall, an antitrust attorney at Live Nation Entertainment’s longtime law firm Latham & Watkins.
While the Justice Department’s cybercrime prosecutors were investigating Ticketmaster, the agency’s antitrust lawyers spent 15,000 hours probing competition complaints about the concert promotion and ticketing giant, according to another person familiar with the antitrust investigation. The probe initially focused on more than a dozen potentially problematic negotiations between Live Nation and venues, before zeroing in on six instances in which prosecutors said that from 2012 through March 2019 the company threatened to withhold concerts or blacklisted venues that considered switching from Ticketmaster.
The Justice Department’s top antitrust official at the time, Makan Delrahim, authorized suing the company over alleged violations of the 2010 settlement, the person says. Faced with that looming complaint, Live Nation Entertainment agreed to a new settlement in 2019.
Since the 2010 merger, Live Nation Entertainment has developed a “well-earned reputation for threatening behavior and retaliation,” federal prosecutors said in court filings outlining the terms.
The agreement imposed an external monitor—Mark Filip, a former federal judge from the law firm Kirkland & Ellis, where then-Attorney General Bill Barr and his No. 2, Jeffrey Rosen, formerly worked. The monitor is charged with investigating further disputes and ensuring Live Nation Entertainment complies with the deal’s terms through December 2024. Under the new settlement, Live Nation Entertainment wasn’t required to admit liability for the six instances that DOJ lawyers alleged violated the 2010 consent decree.
When Live Nation and Ticketmaster originally merged in 2010, 17 states signed on to the agreement. But the Justice Department negotiated the new deal without involving the states, according to another person involved in the discussions.
Neither the states nor the DOJ prosecutors negotiating the new antitrust settlement were aware of the Songkick allegations, the two people say, even though the first set of charges against Zaidi were filed in October 2019, two months earlier. Both individuals requested anonymity because they weren’t authorized to discuss the confidential deliberations.
The Justice Department declined to comment on either the cybercrime or antitrust case. Delrahim, now a partner at Latham & Watkins, also declined to comment aside from noting that he’s recused from doing work for Ticketmaster because of his involvement in the DOJ case.
Antitrust advocates and many music fans are hopeful the Justice Department will finally challenge the ticketing giant in the wake of the Taylor Swift debacle. The Biden DOJ’s top antitrust official, Jonathan Kanter, has been skeptical of merger settlements like the one used in the Ticketmaster-Live Nation deal, arguing in an April speech that it’s “not our role to micromanage corporate decision-making under elaborate consent decrees.” Kanter has also pushed the agency to bring more cases against alleged monopolies, especially when consumers are paying high fees and have few choices.
The Justice Department made a “strategic choice” in 2019 to renegotiate the settlement instead of pursuing a bigger case against Ticketmaster, says Henry Hauser, a former DOJ antitrust lawyer. “DOJ got to say this is a win without going to trial,” says Hauser, now an antitrust counsel at the law firm Perkins Coie. “There’s still a lot on the table” they could pursue now.
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