AEG has been named in an antitrust lawsuit after an Oregon promoter accused the firm of refusing to allow Coachella festival acts to play other regional events.
Soul’d Out Productions, the independent producer behind Soul’d Out Festival in Portland, Oregon, has sued Coachella promoter AEG and its affiliated companies for allegedly using anticompetitive practices.
The Oregon promoter has taken issue with a so-called “radius clause” for artists contracted to play at AEG’s Coachella Valley Music and Arts Festival, which draws hundreds of thousands to southern California in mid-April.
“By means of this clause, Defendants prohibit artists who seek to perform at Coachella from performing at any other festival or themed event within a distance that extends over 1,300 miles, and for a period of nearly five months surrounding Coachella,” states the complaint.
“Such a clause has a substantial chilling effect on the market for music venues within the territory covered by the Radius Clause.”
Soul’d Out said it objects to the expansion of the radius clause to cover Oregon and Washington and alleges the territorial restrictions have no pro-competitive effect as Coachella already sells out within a matter of hours.
“Because Defendants have substantial market power, they are able to coerce artists into agreeing to these unlawful restrictions on trade,” continues the complaint, handled by attorneys at Schwabe, Williamson & Wyatt.
“As a result, those artists have lost the benefits of performing at competitive venues or festivals that exist on the West Coast. The restriction on the ability of these artists to choose performance venues has thus affected a substantial volume of commerce on the West Coast and has an anticompetitive effect on the consumer, music venues and festivals on the West Coast, and promoters of such events — entirely as a consequence of Defendants’ strong-arming and leveraging tactics.”
The plaintiff seeks a declaration that the radius clause is unenforceable and an injunction. Additionally, treble damages are being sought.
AEG’s Goldenvoice division (a co-defendant) offered a response to the lawsuit: “Radius clauses are an industry standard used by festival, concert and tour promoters designed to protect the integrity and exclusivity of their events,” said a spokesperson.
“While Coachella is a marquee brand, with close to 250,000 people attending from across the world and is a premier performance stop for 120 artists and bands, there are hundreds if not thousands of artists available to perform at venues around the country.
“The producers of Coachella will vigorously defend ourselves against this lawsuit, which calls into question the common industry practice employed by promoters and producers throughout the year.”
Image: Alan Paone
