A New York court refused to toss the DOJ’s “tying” claim that Live Nation coerces artists into using its concert promotion services if they want to perform at venues in the group’s vast network. This one of the core accusations in the DOJ’s high-profile lawsuit, introduced last May.
Live Nation had argued that it is not forcing artists into tying because it is actually competing concert promoters hired by artists, not the artists themselves, who rent the venues, and Live Nation has no duty to aid its competitors.
However, US District Judge Arun Subramanian ruled that prosecutors have sufficiently established their claim that Live Nation engaged in illegal tying, which requires artists to purchase one product or service to gain access to another.
In a seven-page ruling, issued last Friday, Judge Subramanian wrote: “The nature of the financial arrangement between promoters and artists is a factual question that can’t be resolved on the pleadings, and the complaint at least suggests that it’s artist-specific,” he wrote. “If the evidence shows that promoters book venues on behalf of specific artists, that artists are the driving force behind which venues to book and when, and that artists are coerced into using Live Nation as their promoter if they want access to Live Nation’s amphitheatres, plaintiffs may have a viable tying claim.”
Historic antitrust suit
The DOJ complaint accuses Live Nation and Ticketmaster of unlawfully maintaining monopolies in concert promotion and primary ticketing markets, while engaging in other exclusionary tactics.
The suit added that the “flywheel” is Live Nation-Ticketmaster’s self-reinforcing business model that captures fees and revenue from concert fans and sponsorship, uses that revenue to lock up artists to exclusive promotion deals, and then uses its powerful cache of live content to sign venues into long term exclusive ticketing deals, thereby starting the cycle all over again.
Optimism about Trump’s DOJ
Last month, Joe Berchtold, Live Nation’s chief financial officer, said he is hopeful the new Trump administration will be more open to potential settlement discussions surrounding its antitrust lawsuit than the previous administration.
In an earnings call, Berchtold was asked about updates on the legal process and whether there was any potential to advance discussions with the agency given that President Donald Trump’s DOJ antitrust nominee Gail Slater had “indicated some openness to settlements where effective remedies can be put into place”.
He said: “Is there a path towards a resolution with the DOJ that doesn’t lead to the trial? We’ve said in the last administration, there was really no interest in any discussion on settlement. So, we’re hoping that this DOJ returns to a more traditional approach and is open.”