DOJ officially files antitrust lawsuit against Live Nation

US Justice Department officials have officially filed an antitrust lawsuit against event promoter and ticket vendor Live Nation (LYV). Yahoo Finance Legal Reporter Alexis Keenan joins Market Domination to explain Live Nation's alleged regulatory violations the Department of Justice (DOJ) is bringing forward in its case. Concertgoers have been fuming for years over inflated ticket prices and online fees when purchasing from Live Nation, who merged with Ticketmaster in 2010.

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This post was written by Luke Carberry Mogan.

Video transcript

The justice department is widening its antitrust crackdown as it goes after live Nation filing a lawsuit Thursday that seeks a break up of the entertainment giant.

Yahoo Finance is Keenan here with more details.

Hi, this is something perhaps we suspected ever since like executives got ha before Congress Taylor swift effect cetera.

But now we know the details.

Yes.

So everyone saw it coming but it is a very sweeping lawsuit.

And what the deal J is alleging against Live Nation is that it is using coercive tactics and it violated agreement that it entered into after already getting approval from the DOJ back in 2010 to go ahead and merge with uh Ticketmaster that was under the Obama administration and then another revised settlement agreement to keep this merger intact that happened in 2020.

So what the DOJ is now saying is that they are acting as a gatekeeper over the entire industry in the US for live music.

So the ecosystem that does allow promotion and events to actually get carried on in the US.

Now, who are they saying is being harmed here?

They say artists uh as well as venues, fans, competitors as for artists, they say that artists are being blocked from venues and that live nation is strong arming artists and saying, well, unless you use our promotional services, you're not gonna go to these top venues as for venues.

They say that they're pushing on these venues, these long term contracts that say you must exclusively use Ticketmaster for the ticket sales or else.

No go also fans controlling how they purchase their tickets, controlling the fees that they pay.

And if you look at the list of fees that are in this complaint, you have service fees, platinum fees, VIP fees per order fees, handling fees, payment processing fees.

You get the idea.

Uh I just went on to the website Ticketmaster just before he came on here and tried to buy a $300 worth of tickets.

So two tickets and on top of that, it became a 359 95 deal.

So they don't like that.

They think that is not good for consumers, not good for competition.

As for live nation.

They said that Ticketmaster is not a monopoly at all, they say, and by the way, this lawsuit will not solve this problem that consumers are having with the fees, the bulk of the fees they say go to the venues.

Uh But this is really rare.

The doj here is asking for a break up.

They're putting that on paper.

They say at the very least we want you to divest Ticketmaster.

And what do analysts say that will, do?

They say, well, that will leave the company as just a shell of its former self because the bulk of the fees, uh, the bulk of the profits are generated through that, uh, Ticket Master operation.

I mean, it, I just, I remember I'm old enough to remember when Ticketmaster didn't belong to live nation.

Right.

You and me both and the fees were still high, they were still high.

So there may be some merit to that.

It's just, you know, I just wonder, will this really solve what they're trying to solve for?

And, or would there need to be some sort of legislative remedy for ticket fees instead?

Not that Congress has moved on that?

They talked about it, but we haven't seen that.

I mean, so you have control of the market wise, the percentage share according to the DOJ is that on the ticket sales side, Ticketmaster is holding 80% of that market.

That is, that's what it is.

But what was it before live Nation bought them?

I, I don't know that I can find out that either our next story.

And on the promotional side, they say it's 6060 plus percent.

Uh So they really make these allegations like they have in some of the other complaints that have come to antitrust complaints under this administration.

They say it's this confluence of activities.

Uh these, these strong arming of different parties and they say that there's collusion really, they don't necessarily use that word, but they say that there's also acquisitions of smaller promoters that have come along the way.

Um So, you know, maybe some points will be taken by uh a ju they're asking for a jury here.

That's also a, a new kind of move by the justice department doesn't happen very often on that, on that jury.

Yeah, of course, It all, this all came up because of that meltdown or with the Taylor Swift sales.

So, uh a lot of attention came after that.

Thanks a lot, Alexis.

Appreciate it.