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Live Nation-Ticketmaster consent decree extended
The US district court for the District of Columbia (Washington DC) has issued a judgment extending the 'consent decree' governing the 2010 merger of Live Nation and Ticketmaster for a further five and a half years.
Live Nation reached a settlement extending the decree with the United States Department of Justice (DOJ) in December, following a DOJ investigation into alleged anti-competitive business practices.
The DOJ alleges Live Nation has violated provisions of the decree – which, among other things, requires Ticketmaster to license its ticketing software to competitors – on multiple occasions over the past decade. The claims are strenuously denied by Live Nation, which says the North American ticketing market is more competitive now than ever.
As a result of the court judgment, Live Nation will pay the DOJ's costs, as well as fees for monitoring and enforcement of the decree through 2025.
"We strongly disagree with the DOJ's allegations in the filing and the conclusions they seek to draw"
Makan Delrahim, assistant attorney-general in the DOJ's antitrust (competition) division, says: "The amended decree reimburses the American people millions of dollars and makes it easier for the antitrust division and state enforcers to identify and prosecute future transgressions."
"Live Nation settled this matter to make clear that it has no interest in threatening or retaliating against venues that consider or choose other ticketing companies," said a Live Nation spokesperson in a statement issued on 9 January.
"We strongly disagree with the DOJ's allegations in the filing and the conclusions they seek to draw from six isolated episodes among some 5,000 ticketing deals negotiated during the life of the consent decree. [In a court filing earlier this month, DOJ lawyers submitted evidence they allege shows instances in which six venues were told Live Nation would stop booking acts there if they used a ticketing company other than Ticketmaster.]
"Nevertheless, in keeping with our decision to settle, our focus is now on bringing this matter to its conclusion and continuing to deliver the best live event experiences to fans everywhere."
Photo: Phyzome/Wikimedia Commons (CC BY-SA 3.0)
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Live Nation shares up 10% post DOJ settlement
Live Nation's share price rose by US$6.79 to $70.60 yesterday (Thursday 19 December) following news that it had reached a settlement with the US Department of Justice (DOJ) over antitrust allegations.
The DOJ had opened investigations into Live Nation last Friday over concerns that the company had violated the terms of a decree governing its 2010 merger with Ticketmaster.
Both Live Nation and Ticketmaster refuted all allegations of anti-competitive practice.
As part of the settlement, the DOJ is extending and modifying the decree that permits the merger, and which was set to expire next year, until 2025. The justice department calls the agreement the "most significant enforcement action of an antitrust decree in 20 years".
Following the news, Live Nation's stock, which had dropped to around $64 per share following news of the DOJ investigation, rebounded to the levels it had been trading at before, jumping almost 10% to just over $70. Shares remained up at $69.83 at the time of writing.
"We believe this is the best outcome for our business, clients and shareholders as we turn our focus to 2020 initiatives"
"We have reached an agreement in principle with the Department of Justice to extend and clarify the consent decree," comments a Live Nation spokesperson. "We believe this is the best outcome for our business, clients and shareholders as we turn our focus to 2020 initiatives."
Under the terms of the modified agreement, Live Nation is prohibited from pressuring venues to use Ticketmaster and from withholding shows from a venue if it chooses to go with another ticketer. An independent party will monitor Live Nation's compliance with the decree, and a $1 million fine will be levied for any violation of the agreement.
"When Live Nation and Ticketmaster merged in 2010, the Department of Justice and the federal court imposed conditions on the company in order to preserve and promote ticketing competition," says assistant Attorney General Makan Delrahim of the Justice Department's Antitrust Division.
"Today's enforcement action including the addition of language on retaliation and conditioning will ensure that American consumers get the benefit of the bargain that the United States and Live Nation agreed to in 2010. Merging parties will be held to their promises and the Department will not tolerate transgressions that hurt the American consumer."
The full DOJ statement can be read here.
Live Nation refutes DOJ antitrust allegations
Live Nation and Ticketmaster have hit back at allegations their business practices are in violation of the 'consent decree' that governed the 2010 merger of Live Nation and Ticketmaster.
At a Senate antitrust subcommittee hearing yesterday (17 September), Makan Delrahim, assistant attorney-general for the US Department of Justice (DOJ)'s antitrust, or competition, division, said the DOJ is "examining allegations of violations" of the decree – which, among other provisions, required Ticketmaster to license its ticketing software to competitors including AEG (an offer AEG reportedly never took up) and offload its then-subsidiary Paciolan.
The consent decree attracted renewed attention last year when a New York Times article, 'Live Nation rules music ticketing, some say with threats', reported that the DOJ was looking into "serious accusations about Live Nation's behaviour in the marketplace", including "complaints that Live Nation, which manages 500 artists, including U2 and Miley Cyrus, has used its control over concert tours to pressure venues into contracting with its subsidiary, Ticketmaster."
Responding to the Times's article, Ticketmaster's North American president, Jared Smith, asserted that the ticketing market in the US today is "far more competitive than ever", and that Ticketmaster remains the market leader "because we have worked hard to create better products and add new services".
"We do not force anyone into ticketing agreements by leveraging content"
Delrahim (pictured) yesterday declined to elaborate on his findings, according to the Wall Street Journal.
Commenting on the DOJ investigation, Ticketmaster and Live Nation say in a joint statement: "As we have previously stated, Live Nation and Ticketmaster have always complied with their obligations under the consent decree.
"We do not force anyone into ticketing agreements by leveraging content, and we do not retaliate against venues that choose other ticketing providers."
The antitrust hearing primarily focused on the big tech firms, including Amazon, Facebook, Apple and Alphabet (Google).
NY law firm investigates LN over DOJ claims
New York legal firm Bragar, Eagel & Squire (BES) has announced it is investigating Live Nation's business practices on behalf of shareholders, amid reports the US Department of Justice (DOJ) is looking into alleged anti-competitive behaviour by the concert giant.
On 1 April, in an article entitled 'Live Nation rules music ticketing, some say with threats', the New York Times reported the DOJ is "looking into serious accusations about Live Nation's behavior [sic] in the marketplace", including "complaints that Live Nation, which manages 500 artists, including U2 and Miley Cyrus, has used its control over concert tours to pressure venues into contracting with its subsidiary, Ticketmaster.
"The company's chief competitor, AEG, has told the officials that venues it manages that serve Atlanta, Las Vegas, Minneapolis, Salt Lake City, Louisville, Kentucky, and Oakland, California, were told they would lose valuable shows if Ticketmaster was not used as a vendor, a possible violation of antitrust law."
According to BES, its investigation concerns "whether Live Nation has violated the federal securities laws and/or engaged in other unlawful business practices". Live Nation's share price dipped following the publication of the article, and BES encourages investors and shareholders who suffered a loss to contact the firm.
"I would much rather talk about the things we are doing … But I guess none of that sells newspapers"
Responding to the claims in the Times, Ticketmaster's president in North America, Jared Smith, says "it is absolutely against Live Nation and Ticketmaster policy to threaten venues that they won't get any Live Nation shows if they don't use Ticketmaster. We also do not re-route content as retaliation for a lost ticketing deal. Live Nation is the most artist-focused company in the world, and misusing our relationship with artists to settle scores with venues would be both bad business and counter to our core beliefs."
"Unfortunately, that isn't what some of our competitors, including AEG, want you to believe," Smith continues. "They have been telling anyone who will listen that the reason they often lose to Ticketmaster is not because we have worked hard to create better products and add new services, but because we threaten venues with a loss of Live Nation content (concerts) if they don't pick Ticketmaster as their ticketing partner."
Contrary to the 2010 merger of Live Nation and Ticketmaster – which was subject to a 'consent decree' which, among other things, required Ticketmaster to license its ticketing software to AEG (an offer the Times says AEG never took up) and offload its then-subsidiary Paciolan– stifling competition, Smith says the ticketing market in the US today is "far more competitive than ever".
BES's investigation concerns "whether Live Nation has violated the federal securities laws and/or engaged in other unlawful business practices"
"The proof is in how competitive the ticketing marketplace is today," he says. "It is very well known that the business is far more competitive than ever. Some of our competitors, including SeatGeek, are companies that didn't sell primary tickets until very recently. Others, like AXS and Eventbrite, have been around for years but have greatly built up their businesses with acquisitions. And new entrants are on the horizon, including resale ticketing companies and e-commerce giants."
Smith concludes: "I would much rather talk about the things we are doing to ensure that consumers get fair access to tickets, such as Verified Fan; the lawsuits and public policy efforts we have launched to fight scalpers, bad actors and bots; and our fantastic consumer security initiatives around digital tickets. But I guess none of that sells newspapers.
"So, we will continue to uphold the principles of the consent decree as we always have without shying away from talking about the things that we believe make us the best overall partner in the market. That's the way competition should work."
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