The United States government and various states have recently filed an antitrust suit against multinational entertainment corporation, Live Nation Entertainment. Claims are made that they are guilty of monopoly, which affects artists, concert venues and music enthusiasts across their live entertainment sector.
According to the lawsuit, Live Nation has breached § 1 and 2 of the Sherman Act. This longstanding US antitrust law was established in 1890 to mandate rules of free competition and outlaw unfair monopolies. § 1 of the Act declares that contracts which limit trade are illegal, while § 2 makes any attempts to monopolize any part of trade and commerce a misdemeanor.
Violations under § 1 are particularly seen in the gaming of large amphitheaters and related services. As per the case, Live Nation has unlawfully compelled artists performing in extensive venues to also acquire promotional services. This falls under the Sherman Act’s definition of free competition.
On the other hand, violations under § 2 involve Live Nation’s strategies of diverting live music performances to other locations unless these venues agree to partner with their parent company, Ticketmaster. It was also inferred that Oak-View Group was co-opted by Live Nation to escalate this strategy, warning venues that failure to coordinate with Ticketmaster would lead to losing their Live Nation contracts. More allegations include delayed sales of secondary tickets via competing ticketing platforms, refusing to advertise events at venues that utilize different ticketing platforms, and imposing long-term exclusive contracts, which last anywhere from three to 14 years.
A significant number of states, some of which include Arkansas, Arizona, and Nevada, joined the lawsuit. They assert that Live Nation violated laws on fair trade practice and bans on monopolies under the rules of their respective states.
Responding to the allegations, Vice President of Corporate Affairs at Live Nation, Dan Wall stated in a blog post that the company does not qualify as a monopoly. He claimed that monopolies are characterized by profits affected by monopoly pricing, which, in Live Nation’s case, are deeply contrasted by companies such as Airbnb that charge significantly higher service fees.
As of now, the court is yet to receive any response from Live Nation in regards to the lawsuit.