The US Federal Trade Commission has been investigating whether Live Nation’s Ticketmaster has done enough to stop touts or scalpers from buying up tickets from its primary platform to then resale on the secondary market, according to sources who have spoken to Bloomberg.
The investigation is now “at advanced stages”, and the FTC will decide whether to bring a legal case against the ticketing company “within weeks”. If that happened and violations were proven, Bloomberg adds, the live giant could face billions in fines.
The news agency reports that the investigation is “focused on Ticketmaster’s compliance with a law meant to prevent automated ticket resales”, which will be the US Better Online Ticket Sales Act.
Among other things, FTC investigators are reportedly looking into whether Ticketmaster has “a financial incentive” to let scalpers circumvent its own restrictions on how many tickets any one person can buy, because the scalpers then resell those tickets on the Live Nation company’s resale marketplace.
Needless to say, Ticketmaster denies any wrongdoing, telling reporters that “the FTC has a fundamental misunderstanding of Ticketmaster’s policies and is taking an excessively expansionist view of the BOTS Act”, before adding, “Ticketmaster has invested more to stop scalpers than the rest of the industry combined”.
The revelations about the Ticketmaster investigation follow the FTC’s recent lawsuit against Key Investment Group, which operates a number of ticket scalping businesses. It’s accused of violating the BOTS Act, which prohibits the use of bots, or other dodgy tactics, to source tickets from primary platforms in order to resell them.
KIG pre-empted that lawsuit with its own court filing in which it said that Ticketmaster was aware of and endorsed the tactics it uses to source tickets, including the use of multiple accounts, credit cards and mobile numbers to circumvent restrictions put in place by the primary ticketing site.
Not only that, but “Ticketmaster’s ticket resale programme actively works” with KIG, it claimed, including by “providing KIG with tools to manage its multiple accounts and more easily resell tickets on Ticketmaster”.
Earlier this year President Donald Trump issued an executive order telling the FTC to crack down on unscrupulous practices in the secondary ticketing market, including by better enforcing the BOTS Act.
That said, according to Bloomberg, the FTC’s scrutiny of Ticketmaster actually pre-dated Trump’s current presidency, starting under former, and Joe Biden appointed, FTC Chair Lina Khan. However, the government agency “redoubled its scrutiny” following Trump’s executive order.
Live Nation is still much more involved in secondary ticketing in the US than in Europe, but has nevertheless started to call for more regulation of ticket resale in the US market. That’s likely, in part, to distract law-makers from seeking to more tightly regulate primary ticketing.
Any revelations that Ticketmaster itself is involved in the dodgier side of ticket scalping will therefore be particularly embarrassing at the moment.
The live giant is also continuing to battle litigation from the US Department Of Justice over allegations of anticompetitive conduct. That also began on Biden’s watch and some speculated that the DoJ’s legal action against Live Nation might be quietly parked under Trump, but so far it has proceeded unhindered.