Live Nation Faces ‘Fed Up’ States After 16 Years of Battles

Live Nation Entertainment Inc. and dozens of states tried for days last week to settle an antitrust lawsuit accusing the company of illegally monopolizing the live entertainment market and overcharging concertgoers millions of dollars for tickets.

Despite a federal judge ordering settlement talks, only six states joined the Justice Department in reaching a deal, leaving more than 30 of them to continue with a trial that resumed Monday.

The Justice Department settlement — which stopped short of a breakup and allowed Live Nation to keep Ticketmaster — came as a shock to the states, Bloomberg News has reported. The rebuke added to the hard feelings following more than a decade and a half of antitrust-related combat between the states and the company.

The DOJ’s exit from the trial also created serious logistical hurdles for the states, which are now relying on an outside law firm to help litigate the case. It also marks the third time since 2010 that antitrust enforcers have entered into a deal with Live Nation over its conduct in the live events market.

The states “are essentially fed up” and don’t want to agree to a third deal with Live Nation that doesn’t change the company’s behavior, said Gwendolyn Lindsay Cooley, who headed antitrust for the state of Wisconsin until 2024.

The states want to see a full breakup “of the Ticketmaster ticketing system from Live Nation,” said Cooley, now the founder of an AI legal startup. For them, anything else “will not be enough.”

Internal Emails

On Tuesday, the states called several Live Nation employees to testify, drilling down in internal emails, texts and presentations where they discussed how the company could “consolidate” the amphitheater market in some areas and “use the leverage” in negotiations with artists.

Live Nation, the Justice Department and the New York attorney general’s office that is now leading the case, didn’t immediately respond to requests for comment on antitrust clashes between states and the company.

The Justice Department and 39 states plus Washington DC sued Live Nation in 2024, alleging the company illegally monopolized the live events industry. Both the federal agency and state attorneys general can enforce US antitrust law, but only the states can seek damages on behalf of their citizens. By filing jointly, enforcers could seek a breakup of the company and money to pay back concertgoers who were allegedly overcharged because of Live Nation’s monopoly.

The lawsuit drew on years of history between the US’s largest concert promoter and antitrust enforcers.

When Live Nation sought to buy Ticketmaster, the largest ticketing platform, in February 2009, several states were opposed – particularly California, New York and Tennessee, states where much of the music industry is based.

While former President Barack Obama’s top antitrust officials were initially eager to challenge the deal, they knew a lawsuit would have been difficult to win, according to people familiar with the case. Concerned about the impact of a court loss on future cases, the Justice Department negotiated a deal to allow the merger with conditions and persuaded the states to sign on.

That consent decree, signed by 16 states, sought to alleviate concerns that one half of the business might disadvantage rivals of the other half, for example, by leveraging Live Nation’s control over concerts to benefit Ticketmaster. The settlement required the new company to pledge not to tie its services together or retaliate against venues that switched promoters or ticketing services.

It didn’t take long, though, for both federal enforcers and the states to begin hearing complaints about Live Nation’s conduct. Those complaints came to a head in 2019 as Live Nation’s 10-year consent decree was set to expire and some within the industry lobbied antitrust enforcers to extend it.

During the first Trump administration, the Justice Department and the states had an uneasy relationship on antitrust. In July 2019, a group of states led by New York sued to block the merger between Sprint and T-Mobile Inc., arguing the Justice Department’s settlement wouldn’t resolve competition concerns. In September, the states announced their own antitrust probes of Alphabet Inc.’s Google and Meta Platforms Inc., not trusting the Trump administration to investigate the companies and bring cases on its own.

Joint Probe

At first, the Live Nation case was an exception to the tension between federal and state antitrust enforcers. As the 2010 consent decree neared its expiration, the Justice Department and the states opened a joint probe into complaints that the company threatened to withhold concerts or blacklist venues if they switched from Ticketmaster to an alternative.

The group spent thousands of hours investigating, eventually honing in on six instances between 2012 and March 2019 where Live Nation allegedly threatened venues. Until November 2019, Justice Department staff and the states were moving towards a lawsuit and the DOJ antitrust chief at the time, Makan Delrahim, authorized filing a complaint, according to people familiar with the case.

Federal and state antitrust officials on the case believed they had solid evidence that Live Nation had violated its earlier settlement, which would allow them to seek stiff fines or potentially ask for a breakup of the company, the people said.

But Live Nation maintained it had done nothing wrong. The agreement with antitrust officials that allowed Live Nation to buy Ticketmaster a decade earlier required a showing of intent – that Live Nation didn’t book a concert at a venue in order to retaliate for lost business. The company argued that in each of the cases the reason for a switch was economics and not retaliation.

Still, concerned about the negative publicity, the company offered to settle claims that it had violated the earlier agreement, according to the people, who asked not to be named discussing confidential negotiations. The Justice Department on its own quickly negotiated a new consent decree with Live Nation, said the people. The agreement was presented to the states as a done deal, sparking screaming matches between officials representing the states and Justice Department leaders and led to continued hard feelings, the people said.

New Agreement

After the Justice Department filed court papers that it had reached a new agreement in 2019, states filed their own briefs alleging they weren’t adequately consulted.

Only then did Live Nation agree to negotiate with the states and add terms giving the attorneys general authority to investigate and sue over violations without the Justice Department, the people said.

Despite the 2019 changes – which included a monitor to ensure Live Nation’s compliance – state and federal antitrust enforcers alleged in the new lawsuit in 2024 that the company continued to threaten venues that sought to switch away from Ticketmaster.

The company’s alleged threats are a key part of the current case. The first trial witness on March 4 – a former executive for the Barclays Center in New York – testified that a Live Nation employee texted him a “warning” that he should “think about the bigger relationship with LN” before switching away from Ticketmaster.

John Abbamondi, the former CEO of BSE Global, which owns the Barclays Center and the Brooklyn Nets basketball team, also said Chief Executive Officer Michael Rapino warned that Live Nation might withhold concerts once Barclays transitioned away from Ticketmaster.

In a phone call played for the jury, Rapino said Live Nation was going to have “a tough time” offering concerts to the venue despite an agreement that guaranteed it a certain number per year.

“I interpreted his comment as a veiled threat,” Abbamondi said.

Some of the state enforcers still believe the 2019 settlement was a mistake, allowing Live Nation to continue its bad behavior, several other people said. Having been burned twice by the Justice Department agreeing to a deal with Live Nation without fully consulting them, the states are highly reluctant to agree to a third settlement.

Top photo: The Live Nation logo arranged on a smartphone in New York, US, on Wednesday, April 17, 2024. Photographer: Gabby Jones/Bloomberg.