By Sarah N. Lynch, David Shepardson and Mike Scarcella
WASHINGTON (Reuters) -The U.S. Justice Department and a group of 30 states and the District of Columbia Thursday sued to break up Live Nation, arguing the big concert promoter and its Ticketmaster unit illegally inflated concert ticket prices and hurt artists.
“It is time to break up Live Nation,” said U.S. Attorney General Merrick Garland.
Concert fans and politicians for years have been calling for a re-examination of Live Nation’s purchase of Ticketmaster in 2010, especially after the ticket seller in 2022 botched sales to Taylor Swift’s first concert tour in years, sending fans into hours-long online queues, charging prices that customers said were too high and drawing charges of poor service.
Thursday’s legal action underscores the aggressive approach President Joe Biden’s antitrust enforcers have adopted as they seek to create more competition in a wide range of industries, from Big Tech to healthcare to groceries.
Live Nation “suffocates its competition,” Garland said. It relies on unlawful, anticompetitive conduct to exercise its monopolistic control over the live events industry in the United States at the cost of fans, artists, smaller promoters, and venue operators,” Garland said, adding that as a result fans pay more in fees, artists have fewer opportunities to perform and smaller promoters get squeezed out.
Shares of Live Nation were down 5.8%.
In the lawsuit, the Justice Department and states asked the court to “order the divestiture of, at minimum, Ticketmaster, along with any additional relief as needed to cure any anticompetitive harm.”
Live Nation called the suit a possible “PR win for the DOJ in the short term,” but said the entertainment company would prevail in court. The lawsuit “won’t solve the issues fans care about relating to ticket prices, service fees, and access to in-demand shows.”
“There is more competition than ever in the live events market,” it added.
The suit says Live Nation directly manages more than 400 musical artists and controls around 60% of concert promotions at major venues. It owns or controls more than 265 concert venues in North America, and through Ticketmaster controls roughly 80% or more of big venues’ primary ticketing for concerts.
In filing in the Southern District of New York, the DOJ argued the “vast scope” of Live Nation and Ticketmaster allowed them to “insert themselves at the center and the edges of virtually every aspect of the live music ecosystem.”
Democratic Senator Amy Klobuchar welcomed the suit in an interview on MSNBC on Thursday, but said Congress still needs to take additional action “to put the fans first” by increasing ticketing sales and blocking bots from buying blocs of tickets. “There’s just no rules for the road here.”
Attorneys general from New York, California, Florida and Texas joined the DOJ’s suit.
In 2010, the Justice Department approved Ticketmaster’s controversial merger with Live Nation, with conditions intended to stop the combined company from harming competition.
In 2020, a court extended most of the DOJ’s oversight of the merger to 2025 because, the department said, Ticketmaster retaliated against stadiums and arenas that opted to use other ticketing companies.
The Justice Department said its prior case against Live Nation “tried to protect what should be a dynamic, thriving industry.” The government alleged Live Nation has shown since then “additional, different, and more expansive forms of anticompetitive conduct and exclusionary practices.”
(Additional reporting by Chris Sanders and Susan Heavey; Editing by Tom Hogue and Nick Zieminski)