The Justice Department has used a trove of internal communications that offer a rare behind-the-scenes glimpse into the industry in its lawsuit accusing Live Nation Entertainment, the concert industry giant that owns Ticketmaster, of operating an illegal monopoly.
In a wide-ranging complaint filed Thursday, the Justice Department sought to break up the companies, arguing that the 2010 merger of Live Nation and Ticketmaster stifled competition, stifled innovation and led to higher ticket prices and consumer fees.
Live Nation, the world's largest concert promoter, responded by denying that it is a monopoly and does not have the power to unilaterally raise prices. Despite the government's allegations that it has great power, Live Nation says it faces tougher competition than ever before and that “ticket prices and service fees will not fall” in the Justice Department's lawsuit.
The government detailed the allegations in stunning emails it said were written by Live Nation CEO Michael Rapino and other concert industry leaders.
Below are some of those accusations:
Potential rival Kanye West's concert
One incident in 2021 goes to the heart of the Justice Department's charges that Live Nation went to great lengths to protect its competitive position.
Later that year, Live Nation “threatened commercial retaliation” against Silver Lake, a private equity firm that had invested in TEG, an Australian ticket sales and promotion company involved in a highly anticipated benefit concert co-hosted by Kanye West and Drake at the L.A. Coliseum, according to the government. Silver Lake also had an investment in Oak View Group, a venue management company with close ties to Live Nation.
According to the government, Rapinoe complained to Oak View Group executives that she viewed TEG as a competitor, and Oak View Group told investors that Live Nation was “unhappy.” Rapinoe then told Silver Lake that she was “all in” with Oak View Group and “why would you disrespect me by investing in things like ticket sales and promotions when you have such a big role in the venues?”
TEG had an agreement to sell tickets through StubHub, and the lawsuit alleges that Live Nation attempted to “embarrass” TEG by blocking those tickets, resulting in “hundreds of StubHub customers being denied admission to the event.”
Live Nation then “threatened to withdraw its support for Oak View Group,” and Oak View Group co-founder and leading artist manager Irving Azoff would not allow TEG to promote shows for artists he managed. Azoff told Rapinoe he would demand that Silver Lake sell TEG, to which Rapinoe replied, “I love you.” According to the lawsuit, Silver Lake sought to sell TEG and approached Live Nation about it.
In a detailed response to the Justice Department's lawsuit, Dan Wall, Live Nation's executive vice president of corporate and regulatory affairs, said the allegation that Live Nation threatened Silver Lake “reveals not only a disregard for the facts, but also a deep hypocrisy.”
Wall said Lapino's complaint was “essentially similar” to the Department of Justice and Federal Trade Commission's concerns about “private equity firms making multiple investments in the same industry because of competitive 'entanglements.'”
In a separate statement about the Los Angeles Coliseum concert, Live Nation said, “All we have done is violated our primary ticket exclusivity and thwarted TEG's efforts to directly distribute tickets to the secondary market.” Silver Lake did not respond to a request for comment.
From competitor to “Hammer”
According to the government, Live Nation initially viewed Oak View Group as one of its “largest competitive threats,” but the two companies soon “conspired and developed a mutually beneficial business plan to avoid competing with each other and solidify Live Nation's dominance,” the government said.
According to the government, Oak View Group acted as an “agent” for Live Nation, describing itself as the “pimp” and “hammer” of the corporation, and sometimes made threats on Live Nation's behalf against venues that were considering abandoning Ticketmaster for another ticket seller.
The government's complaint cites purported 2016 emails in which Rapinoe complained to Oak View Group executives about Live Nation's intention to promote artists and shows with which it partners. Oak View Group backtracked, with the company's CEO (Timothy Lawek, who is not named in the complaint) saying, “Our staff got a little ahead of us. We all know we do not promote and we only tour with Live Nation.”
Live Nation executive Wall said Oak View Group “has never been, and does not aspire to be, a concert promoter” and was simply trying to fill the occasional dark night at its venues. “To portray this as an agreement not to compete to promote concerts is a travesty,” Wall wrote. A representative for Oak View Group declined to comment.
Barclays Center ticket sales rivals
In early 2023, The New York Times broke the news that Barclays Center, the Brooklyn arena, would terminate its seven-year contract with SeatGeek, an upstart and aggressive ticket distributor, and enter into a new agreement with Ticketmaster.
The sudden change caused consternation in the industry, raising questions about whether Live Nation had denied venue access to its biggest tours in retaliation for the band's switch from Ticketmaster to SeatGeek. Live Nation denied that at the time, and a Times investigation of its concert data was inconclusive. While the number of Live Nation-promoted shows at Barclays had certainly fallen since SeatGeek took over, the number of shows by independent promoters had fallen as well.
Barclays isn't named in the Justice Department's lawsuit, but Wall acknowledged it on a conference call with investors late Thursday. The government cites an email it says was sent to the venue's CEO by a “senior Live Nation executive” who heard the venue had switched to SeatGeek. “Either way,” the email read, “you should be thinking about your larger relationship with LN, not just who's going to cut you a bigger sponsorship check,” accompanied by a “wink” emoji.
According to the government, Live Nation “followed through on its threats and relocated the concert to another location.”
In response, Live Nation said it “categorically denies any allegations that the concert was rescheduled in retaliation for their decision to go to SeatGeek.”
Acquiring a rival company
The government alleges that Live Nation acquired multiple companies with the intent of eliminating rivals in both concert promotion and ticket sales.
Among the examples the government cites is Utah's United Concerts' use of a local ticket distributor called Smithix. According to what the government says are internal Live Nation communications, the company wanted to expand its ticket sales footprint in Utah but gave up on buying Smithix because “it would require going to the Department of Justice.” Instead, Live Nation bought United Concerts in 2017 and switched its venues over to Ticketmaster. Smithix eventually went out of business, the government said.
The other was Tennessee's AC Entertainment, which also participated in the Bonnaroo festival there. Live Nation took control of the company in 2016. Live Nation executives called the deal a “defense measure” against AEG, though the economics of the deal were “not particularly attractive,” according to the lawsuit. In 2018, Live Nation acquired Frank Productions, a Wisconsin promoter that used ticket distributors other than Ticketmaster. Live Nation bought the company and “switched the venue to an exclusive contract with Ticketmaster.”
Wall responded by saying the AC Entertainment deal was made with a promoter who was in his 60s and looking to retire. “Live Nation did not have an office in Knoxville so they signed a deal for $15 million,” Wall wrote. “Really? Is the Department of Justice challenging that?”
