Texas AG Paxton joins DOJ lawsuit against Live Nation, Ticketmaster over monopoly concerns
Texas Attorney General Ken Paxton is joining the U.S. Justice Department and more than two dozen states in suing Live Nation Entertainment, the parent company of Ticketmaster, alleging it monopolized live events.
The lawsuit, filed Thursday, seeks to lower prices for fans and open venue doors to more musicians.
Live Nation, which generates $22 billion a year in revenue, owns or controls more than 265 concert venues in North America, including 60 of the top 100 amphitheaters, such as the Hollywood Bowl in Los Angeles, according to the Justice Department.
The company bills itself as “the largest live entertainment company in the world."
“Mega-corporations cannot control entire industries to create anti-competitive environments, drive up prices, and take advantage of consumers,” Paxton said in announcing Texas' involvement in the case. “With this lawsuit, we aim to ensure fair competition for ticket sellers, concertgoers, venues, and others in the entertainment space who have been affected by this merger.”
A major facet of the lawsuit revolves around the fees that concertgoers pay in securing tickets. In its filing, the Justice Department refers to those company fees as “essentially a ‘Ticketmaster Tax’ that ultimately raise the price fans pay.”
“The result is that fans pay more in fees, artists have fewer opportunities to play concerts, smaller promoters get squeezed out, and venues have fewer real choices for ticketing services,” U.S. Attorney Merrick Garland said Thursday. “It is time to break up Live Nation.”
Attorneys general from both political parties joined the lawsuit, including Democrats in California and New York and Republicans in Texas and Oklahoma.
What does the lawsuit allege?
The lawsuit alleged the company’s “flywheel” strategy captures fees and revenue from concert fans and sponsorships, pours the revenue into signing artists to exclusive promotion deals and wields the cache of artists to sign venues into exclusive, long-term ticketing deals.
"When families want to attend a concert, the add-on fees they need to pay shouldn’t break the bank," U.S. Deputy Attorney General Lisa Monaco said. "When an independent venue wants to host the next big show, they should have the opportunity to compete. And when a regional promoter wants to publicize an artist, they shouldn’t have to fear retaliation."
The fees Ticketmaster charges for concerts can be staggering. For example, a 2022 Red Hot Chili Peppers show at Bank of America Stadium in Charlotte, N.C., had per-ticket fees of $25.75, plus $3.49 for processing, meaning one concertgoer would pay $29.24, an additional 36% of the original $81.50 ticket cost.
Dan Wall, Live Nation’s executive vice president for corporate and regulatory affairs, said in a statement that the lawsuit blames promoters and ticketing companies for high prices when neither controls ticket prices.
“It ignores everything that is actually responsible for higher ticket prices, from increasing production costs to artist popularity, to 24/7 online ticket scalping that reveals the public’s willingness to pay far more than primary tickets cost,” Wall said.
The lawsuit is much broader than the one that led to the Justice Department reaching a consent decree in 2010 that allowed Live Nation to merge with Ticketmaster, according to department officials. The lawsuit alleges monopolization in all aspects of the business, including promotion of events, access to venues and ticket sales.
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The lawsuit accuses Live Nation of:
Retaliating against potential competitors.
Locking out competitors by signing venues into long-term contracts that block rival ticket sellers or ticketing technology. Ticketmaster’s exclusive agreements cover more than 70% of concert ticket sales at major concert venues.
Restricting artist access to venues by owning or controlling access to the locations.
Live Nation's reaction
Live Nation and Ticketmaster issued a statement saying the bulk of ticket fees go to venues and competition has eroded Ticketmaster’s market share. The companies said a 1.4% annual profit reflects the “opposite of monopoly power.”
“The DOJ's lawsuit won't solve the issues fans care about relating to ticket prices, service fees, and access to in-demand shows,” the statement said. “We will defend against these baseless allegations, use this opportunity to shed light on the industry, and continue to push for reforms that truly protect consumers and artists.”
DOJ lawsuit latest criticism of Ticketmaster
Criticism of Ticketmaster's ticket-selling practices and lack of competition is not new but reached a crescendo after ticket sales for Taylor Swift's Eras tour resulted in major delays and errors in online queues to buy tickets.
“Since Ticketmaster’s Taylor Swift ticketing debacle in 2022, my AG colleagues and I have relentlessly sought justice for Americans wanting to attend concerts without having their pocketbooks pillaged by Live Nation’s monopoly,” Tennessee Attorney General Jonathan Skrmetti said in a statement.
Other music star fans and musicians, including Bruce Springsteen, Foo Fighters and Garth Brooks, have long criticized Ticketmaster's practices. Garland, who said he could remember being transformed as a college senior seeing a young Springsteen warming up for Bonnie Raitt, said the department filed the lawsuit on behalf of fans.
"We all knew that we had just seen the future of rock and roll," Garland said. "The Justice Department filed this lawsuit on behalf of fans, who should be able to go to concerts without a monopoly standing in their way. We have filed this lawsuit on behalf of artists, who should be able to plan their tours around their fans, and not be dictated by an unlawful monopolist."
This article originally appeared on Austin American-Statesman: DOJ, Texas Attorney General Ken Paxton sue Live Nation, Ticketmaster
