The American Antitrust Institute (AAI) has slammed the US Department of Justice (DOJ) claiming that the extension and modification of the 2010 consent decree between Live Nation and Ticketmaster does “little or nothing to deter further anticompetitive conduct.”
Diana L. Moss, the president of AAI, which is an independent, nonprofit organisation that promotes competition, wrote a letter to the Antitrust Division of the DOJ, stating the organisation believes a “far stronger enforcement response than simply modifying the conduct remedies contained in the 2010 Decree is warranted.”
Last month, the DOJ entered an Amended Final Judgement to extend the consent decree between Ticketmaster and Live Nation to 2025.
The original consent decree, which was set to expire in July, allowed Live Nation and Ticketmaster to combine, but required them to follow a set of conditions designed to keep consumer prices in check by preserving competition in the industry.
The court settlement allowed Live Nation and Ticketmaster to continue to operate despite testimony from the DOJ, which claimed the live entertainment giant “repeatedly” broke the decree. It presented evidence it claimed demonstrated that Live Nation threatened at least six venues.
The AAI letter reads: “The DOJ did not need a crystal ball in 2010 to have predicted the imminent failure of its remedies contained in the 2010 decree. Ticketmaster’s monopoly in ticketing was a fact, as acknowledged by the government at the time.”
The AAI points to several factors that are “to blame for the failed attempt to restore competition lost by the merger”, including presumptive illegality of the merger when it was first proposed, evidence of persistent violations of the 2010 settlement, and the company’s ongoing exercise of market power over other ticket sellers in the last decade. It notes that structural remedies are the only remedial mechanism capable of deterring the company’s anticompetitive practices.
The letter adds: “Modifying the conduct remedies in the 2010 Decree does little or nothing to deter further anticompetitive conduct by Live Nation-Ticketmaster. Repeating a decade old enforcement error, while expecting a different result, does a disservice to competition and consumers.”
The DOJ asked the court to forego public comment on the amended decree, which AAI notes is a “disappointment that the public was not given the opportunity to comment.”
The letter also dives into the merger’s impact on the resale market and how the two live entertainment giants have “engaged in a systematic campaign to leverage its market power.”
The AAI said that resale can “enhance efficiency… balance supply and demand, and even expand demand for live music, to the benefit of artists and concertgoers alike.”
The letter claims the two companies acted to impede the development of resale ticketing by supposedly restricting the transferability of passes, holding back ticket inventory and releasing tickets only 48 hours before show times.
It added: “The ineffective remedies contained in the 2010 Decree not only facilitated Live Nation-Ticketmaster’s violations but also the exercise market power against resellers. These factors should have been a major factor in DOJ’s decision to amend and extend the decree instead of pursuing stronger enforcement responses.”