- Ticketmaster and Live Nation want a judge to boot 27 states from the DOJ’s antitrust lawsuit.
- The event goliath argued Wednesday that the states can’t prove a direct injury to their residents.
- Opening their venues to multiple ticketers and promoters could raise ticket prices, they argued.
Lawyers for Ticketmaster’s parent company asked a judge on Wednesday to stop 27 states from participating as plaintiffs in an antitrust lawsuit filed by the Justice Department last May.
The 27 states can’t prove direct injury to their residents as a result of Live Nation’s actions, lawyers for the entertainment giant argued in federal court. More competition could actually result in higher — not lower — costs for concertgoers, the lawyers said, arguing that without proof of injury, the states have no standing to seek damages in the case.
“If Ticketmaster wasn’t doing what it was doing, then multiple ticketers could sell for an event, and then the customers would be better off in that world? That is only a theory,” Live Nation attorney Andrew Gass told the judge on Wednesday.
The 8-month-old lawsuit is still in its early stages, with no trial date set. It seeks to break up Live Nation, saying the company controls 60 of the country’s 100 largest event amphitheaters.
Artists who use these venues are forced to hire Live Nation’s own promoters and use its own ticket distributor — Ticketmaster — creating a monopolistic “ecosystem” that harms competitors and hikes costs for artists and fans, the lawsuit alleges.
The 27 states Live Nation is seeking to remove from the case are seeking triple monetary damages on the argument that their residents have been injured by the inflated ticket prices resulting from this lack of competition.
In his arguments before US District Court Judge Arun Subramanian on Wednesday, the Live Nation attorney said concertgoers are too far removed from the alleged monopolistic conduct for states to sue on their behalf.
“There is such an attenuated chain of causation” between the ticket consumer and any exclusivity deals involving artists, promoters, and venues, he argued.
It is inefficient for the states to be “piggybacking” on the federal goverment’s claims over the exact same conduct, Live Nation also argued.
In downplaying the idea that competition would cut ticket prices as just “a theory,” Gass offered the judge a hypothetical.
Let’s say Live Nation allowed its rival promoters to bid for access to its amphitheaters, the lawyer told the judge. Rival promoter “A” would then offer Live Nation a sizable cut of its profits, only to be outbid by rival promoter “B” offering an even bigger cut. “And then the price of the event goes up,” Gass argued.
The judge voiced some skepticism.
Subramanian said the idea that consumers would save money if Ticketmaster competed with other ticket sellers for the same event “seems like a very straightforward theory.”
Other arguments Wednesday focused on Live Nation’s request that the judge dismiss another major part of the lawsuit: the government’s claim that artists who use Live Nation event venues are barred from using their own promoters, and instead must pay in-house promoters.
“The policy is that third-party artists may not rent their amphitheaters unless those artists purchase Live Nation promotion services as well,” DOJ attorney Arianna Markel told the judge.
“The artist is essentially forced to use Live Nation for its promotion services if it wants to use those amphitheaters,” she said. That’s exactly the kind of “tying” arrangement that is barred under antitrust case law, she said.
Live Nation is asking the judge to dismiss this claim. On Wednesday their lawyer countered that this isn’t “tying” at all — it’s simply a company refusing to do business with its rivals, as is its right.
Here, the judge appeared to agree with Live Nation. “I can’t force them to rent these amphitheaters to rival promoters,” he said.
The judge gave the parties until Monday — and no more than five pages — to file final arguments for and against Live Nation’s dismissal motions.
