The U.S. Department of Justice and a group of states are preparing to file a lawsuit against entertainment giant Live Nation Entertainment for alleged violations of antitrust laws. This move could result in the company's dissolution.
The legal action to address Live Nation's disproportionate control over the concert ticket market will be filed in the Southern District of New York on Thursday, according to a Bloomberg News report citing sources familiar with the case.
In 2010, Live Nation, a leader in organizing and promoting concerts in the country, merged with Ticketmaster, a company specializing in the sale of tickets for events. Although the merger was approved by the Department of Justice under President Barack Obama under the condition that the company not retaliate against concert venues that did not use Ticketmaster, Live Nation was later found to have repeatedly violated this agreement.
During the Donald Trump administration, the Department of Justice amended the original agreement with Live Nation, imposing a third-party monitor to investigate new allegations of non-compliance, and most recently, under the Biden administration, a new investigation was launched due to lingering concerns about compliance with the terms of the agreement.
The case gained significant public attention in 2022 after Ticketmaster's website crashed during ticket sales for a Taylor Swift tour, leading to widespread criticism from consumers and lawmakers. In January 2023, the Senate Judiciary Committee held a hearing to investigate Live Nation's business practices, noting the company's lack of transparency and inability to prevent mass ticket purchases by bots and resellers.
Now, Live Nation will face a lawsuit in which various options are considered, ranging from requiring the company to cease its illegal practices to seeking its dissolution.
Other problems with Live Nation
In addition to alleged anti-competitive practices, the company has been criticized for high ticket prices and poor customer service. Live Nation executives, however, argue that ticket prices are determined by the artists and teams involved in the events.
Stocks go down
Following the lawsuit's announcement, Live Nation shares experienced a significant drop of 7% after the close of trading. This decline reflects investor concerns about the potential impact of legal action on the company.
