In a downtown Manhattan courtroom on Monday, lawyers for the US Justice Department and 40 state and district attorneys general warned a jury that the concert industry was being squeezed by a monopolist: Live Nation-Tickemaster. After amassing dominance over ticketing and artists’ use of large amphitheaters, lead DOJ counsel David Dahlquist alleged, Live Nation constructed a “flywheel” of power that forced venue customers to stay within its ecosystem. It threatened or retaliated against them when they considered leaving. To even attempt to win business, Dahlquist said, ticketing rivals needed to offer “retaliation insurance” to venues worried about losing out on Live Nation shows by making the switch. “Today, the concert ticketing industry is broken,” Dahlquist told the jury in his opening statement. “It is controlled by Live Nation and the company it owns, Ticketmaster.”
In Live Nation’s telling, the story is more upbeat. The company aims to spread joy, and in fact, there’s more concert venues than ever before, said lead Live Nation counsel David Marriott. Even the opening slides were energetic, lit up with images of colorful concerts and tour posters of well-known artists like Bad Bunny and Ariana Grande. “Saying you’re better is not a THREAT!” one memorable slide told the jury, the last word written in red to underscore the point.
The next six weeks will see a long-awaited court battle over whether Live Nation-Ticketmaster illegally monopolized markets for ticketing at major concert venues and use of large amphitheaters by artists. A finding of liability by the jury could potentially lead to a breakup of the company, though Live Nation contends that should be off the table based on certain claims dismissed before trial. A loss for the government would be a blow to its aggressive anti-monopoly push in recent years, at a time when a recent shake-up at the Antitrust Division itself has raised questions about corporate influence.
In court on the first day, the government and Live Nation painted competing pictures of a company that’s omnipresent in the music business. Behind the scenes, they were engaging in aggressive lawyering — before the jury entered the courtroom, Judge Arun Subramanian warned the attorneys that he detected “gamesmanship” in attempts to get each others’ exhibits or arguments thrown out of the case.
To win, the DOJ and states need to prove that Live Nation-Ticketmaster — which it estimates holds an 86 percent market share in primary ticketing for major concert venues, and 78 percent market share for use of large amphitheaters by artists — has monopoly power in the relevant markets, and that it illegally used that dominance to harm competition, through behavior that made it difficult for customers to leave for a rival. One prominent example it plans to use to demonstrate this is negotiations with the Barclays Center, which left, then returned, to Ticketmaster as a vendor. “When they tried to switch, they got punished,” Dahlquist said.
“There are no damages here, because we’ve done nothing wrong”
Ticketmaster’s disastrous Taylor Swift meltdown is expected to come up at trial, which the DOJ cites as evidence of a monopolist’s underinvestment in its technology. Marriott chalked it up to a cyberattack that only Ticketmaster’s system could have handled as well as it ultimately did. While the state plaintiffs are seeking damages for what they believe Ticketmaster overcharged customers in what would have been a fair market, Marriott said, “there are no damages here, because we’ve done nothing wrong.”
Marriott attempted to humanize the business, introducing his trial team and some executives in the courtroom, who stood up and smiled at the jury. Though Live Nation and Ticketmaster are corporations, he said, they’re “made up of men and women who wish very much to do the right thing.” Marriott reminisced about his own experiences at live events ranging from the circus as a kid, to an “awkward” first date at a Lionel Richie concert. “Live Nation and Ticketmaster are all about bringing joy to people’s lives and doing it lawfully,” he said.
Ticketmaster only makes a small cut of the money from a ticket sale, Marriott said, with just a 5 percent take rate. And the venue operators that are “supposedly being abused” by the business are really “well-to-do folks,” Marriott said, pointing to a slide of large venues and their owners, like Intuit Dome, owned by former Microsoft CEO Steve Ballmer.
“Live Nation and Ticketmaster are all about bringing joy to people’s lives and doing it lawfully”
Marriott argued that Live Nation-Ticketmaster’s market share is really only 40 percent in ticketing and 18 percent in venues, when you count things that the DOJ left out, like stadiums and most arenas, which are often used for sporting events but also concerts. And it wasn’t retaliation that brought the Barclays Center back into the fold with Ticketmaster, but the fact that “SeatGeek fell down on the job,” he said. Marriott acknowledged that the jury may hear about a call with Barclays Center leadership where Live Nation CEO Michael Rapino “loses his cool” and “drops the F-bomb,” but these were merely signs of frustration about losing out on a contract, not true threats. After all, he said, telling a customer there are consequences for choosing an inferior product is just telling it like it is.
This call and other details could come up on Wednesday, when the DOJ plans to call former Barclays Center CEO John Abbamondi to testify. Soon after, the jury is expected to hear from a top executive for the Minnesota Wild Hockey Club, a venue management company, and the co-founder and CEO of SeatGeek. Over the course of trial, they’ll also likely hear from Rapino, artists like Kid Rock and Ben Lovett of Mumford & Sons, and even a couple music fans. Then, the jury will decide if the concert industry is really as joyful as Live Nation contends.
