The verdict is in: Live Nation in the US is an illegal monopoly that has exploited its market dominance to rip off music fans. That’s the conclusion of the jury at the end of the big antitrust trial in which lawyers representing 33 US states accused Live Nation and its Ticketmaster division of anticompetitive conduct.
It’s a “historic and resounding victory for artists, fans and the venues that support them”, according to Rob Bonta, Attorney General of California, one of the states involved in the litigation.
It also means Live Nation will now have to pay significant damages. Quite how significant remains to be seen, though the jury ruled that Live Nation was overcharging certain customers $1.72 per ticket over five years, and that applies to an awful lot of tickets.
But beyond the damages, there are other matters to consider. Could the judge still order that Live Nation and Ticketmaster be split up, the ultimate sanction proposed when this legal battle began? Why did the US Department Of Justice, which was originally spearheading this action, ultimately settle out-of-court, given a jury has concluded Live Nation is indeed an illegal monopoly?
And could developments in the US prompt new competition investigations into Live Nation in other markets, not least the UK?
Plus, beyond any structural changes at Live Nation that may be forced by the courts, does there need to be a cultural shift at the live music business more generally? The attitude of Live Nation executives in internal communications shared during the trial certainly empowered the US states pursuing their case against the company.
There was boss man Michael Rapino seeming very indifferent to the battle against ticket touts, because, after all, Ticketmaster has its own secondary ticketing products. “Why do we care what ends up on secondary?”, he asked Ticketmaster exec David Marcus in one email exchange, adding “we have secondary - we want to be in secondary”.
Then there was the phone call where, it was argued, Rapino seemed to threaten a venue about to drop Ticketmaster as its ticketing provider that it might also lose access to Live Nation promoted shows.
Though, of course, the internal comms that proved most explosive in court were the slack messages between Live Nation ticketing execs who joked about randomly hiking up ancillary fees at Live Nation’s amphitheater venues, adding, we’re “robbing them blind baby - that’s how we do it”.
Live Nation’s legal team - led by attorneys at law firm Latham & Watkins, also known in the music industry for representing everyone’s favourite AI copyright infringer Suno - tried their best to argue that these isolated conversations had been misrepresented, or weren’t typical of the company’s wider approach to business.
But, in his closing statements last week, attorney Jeffrey Kessler, speaking for the US states, asked the jury, “Who talks like this? What type of company uses this language? The answer, I think you will find, is a monopolist who views itself to be above the law”.
In the short-term all eyes are now on Judge Arun Subramanian. With the jury concluding that Live Nation violated various federal and state laws by willfully monopolising ticketing services to major concert venues and unlawfully tying artist use of large amphitheaters to Live Nation’s concert promotion services, he needs to decide what penalties are appropriate.
In terms of financial damages, Live Nation has already tried to play down the significance of the ruling, given it has already committed to pay out in the region of $280 million as part of its earlier settlement with the DoJ.
“The jury’s award of $1.72 per ticket applies to a limited number of tickets - those sold at 257 venues, which represent about 20% of total tickets - and only to purchases by fans (excluding brokers) in certain states over the past five years”, it said in a statement after the ruling. Based on those limitations, it reckons “aggregate single damages” would be “below $150 million”.
That would likely be trebled, because antitrust law allows that in monopoly cases. But, Live Nation hopes, the total damages bill won’t be too much higher than that $280 million, and certainly won’t run into the billions that some commentators have predicted.
For the live music industry, any structural changes forced on Live Nation by the judge are arguably more important. The live music company has agreed to abide by some new restrictions on its operations in the DoJ settlement and will be hoping that Subramanian will accept something similar, even if it is forced to accept tighter restrictions than those that were agreed with the federal government.
However, critics will argue that Live Nation also agreed to some restrictions on its operations back when it merged with Ticketmaster in 2010, via a consent decree negotiated with the DoJ, and that agreement didn’t stop the unlawful conduct exposed in this trial. And with that in mind, those critics will be wanting to judge to do something much more severe. Such as the forced split of Live Nation and Ticketmaster proposed by the DoJ when it launched this lawsuit.
That’s what Stephen Parker, Executive Director at the National Independent Venue Association, believes should now happen. “Live Nation is an illegal monopoly”, he declared after Wednesday’s ruling, and therefore “the consequences should be swift and disruptive to their vertically-integrated market power”.
What does that mean? Well, “Live Nation and Ticketmaster must be broken up now”. And Ticketmaster “should not be permitted to participate in the ticket resale market”. Plus Live Nation “should not be able to promote more than 50% of artists’ tours”.
“The nation’s fans and independent stages have hope once again because the jury saw Live Nation for what it is”, Parker continued. “Now the case is in the hands of the judge and the plaintiff states to determine the remedies that will protect and compensate fans, venues and promoters for the effects of their monopolistic conduct, and prevent it in the future”.
Live Nation’s settlement of the separate legal claims made by the DoJ was controversial when it was announced one week into the big trial. The live music giant had hired a bunch of Donald Trump allies to put pressure on the DoJ to settle, which almost certainly contributed to Gail Slater, who headed up the DoJ antitrust team leading on the lawsuit, being pushed out of her job in the government department.
Given the controversy, and the jury’s ruling, a group of US senators now want Subramanian to “scrutinise the DoJ’s proposed settlement with Live Nation and Ticketmaster to ensure the department made its decision based on the public interest”, stressing that the judge has the legal right to do so.
In a letter to the judge, senators including Amy Klobuchar and Elizabeth Warren write that the DoJ deal “fails to address fundamental issues and stops far short of prying open this industry to new competition, innovation and choice for consumers”, adding, “the facts surrounding the settlement also point toward a deal made in response to political pressure rather than the public interest”.
As for whether any of this could result in regulatory challenges for Live Nation beyond the US, well, the UK Association Of Independent Festivals certainly hopes that it will prompt British regulators to take another look at the dominance of Live Nation and Ticketmaster in the UK market.
Its CEO John Rostron said yesterday, “AIF has long spoken out and provided evidence against Live Nation’s control and practices, which harm artists, consumers and the rest of the live music sector. This jury ruling is a great first step to ending that harm, but this issue goes far beyond ticketing”.
He added, “With similar influence across everything from festivals and concerts to venues and artist management, we now need similarly strong rulings in relation to the entire live music ecosystem across all territories. We hope that the Competition And Markets Authority will use this moment to expedite real action in the UK”.
Of course, as far as Live Nation is concerned, the fight is far from over in the US. “The jury’s verdict is not the last word on this matter”, it said in its statement, noting that there are outstanding motions in the courts that could impact on “whether the liability and damages rulings stand”. Plus, “Live Nation can and will appeal any unfavorable rulings on these motions”.
To that end, it insisted, “we remain confident that the ultimate outcome of the states’ case will not be materially different than what is envisioned by the DoJ settlement”. We shall see if that optimism is justified - plenty of people in the wider live music community will be hoping it isn’t.