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  • Writer's pictureNancy C. Prager

Lawsuit against Live Nation, LLC and Ticketmaster, LLC

The Department of Justice and 29 states plus the District of Columbia have filed a lawsuit against Live Nation, LLC and Ticketmaster, LLC calling for the court to break up the conglomerate. 

The reason?

The parties claim that the combined companies exert monopolistic control over the markets in which they operate. 

A monopoly occurs when an entity is able to exert an unreasonable restraint on competition in a market. 

In 2010 when I worked with antitrust counsel to oppose the merger of Live Nation and Ticketmaster that created the conglomerate, I think the Department of Justice had a difficult time understanding the market. 

I tried to explain to them how ticketing and concert promotion are conjoined markets, and that the combination of the two companies would result in a monopoly. 

They didn't get it. 

It did not seem to matter to the DOJ attorneys that Live Nation had been developing their own ticketing solution which would have been competitive to Ticketmaster. Live Nation gave up the process and decided it was easier to join forces with Ticketmaster! 

Fast forward 14 years, and this Department of Justice team gets it. 

The lawsuit clearly defines three markets in which the combined companies have "suffocate[d] competition, and inhibit[ed] the evolution of the live music industry" that a free market would support. 

The three primary markets in which the DOJ has identified significant anticompetitive conduct are:

1) Primary Ticketing Services Markets impacting venues and fans;

2) Concert Promotion Services Markets for major venues impacting concert venues and artists; and

3) Large Amphitheaters impacting artists.

Significantly, the complaint focuses on concert promotion for "major venues" and "large amphitheaters" because the market for such services and venues is distinguishable from the market for small clubs and venues. Most musical talent will not graduate from the local clubs and Live Nation serves as a gatekeeper for those who do. 

The complaint lays out significant claims that Live Nation and Ticketmaster exert market power to foreclose on competition as well as make indirect and direct threats to impede potential rivals' progress in the markets. The examples of anti-competitive behavior include:

1) colluding with a rival that was created by a former executive of Live Nation to avoid directly competing for opportunities;

2) threatening venues that did not accept their terms that future opportunities might be at risk; and

3) denying opportunities to artists that are not managed or promoted by Live Nation.

I will do a deeper dive into the complaint and the allegations the DOJ and states are making in a video soon. I am curious about what you think about the claim that Live Nation is a monopoly. Let me know in the comments!

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