Justice Department Sues to Break Up Live Nation-Ticketmaster

The Justice Department and more than two dozen states sued Live Nation on Thursday, alleging the entertainment giant has a monopoly in ticketing and concert promotion and should be broken up.

The lawsuit, filed in a New York federal court, alleges Live Nation used its power to squelch competition and retaliate against promoters and venues that threatened its dominance. The company chokes off competition in key pieces of the concert system, driving prices and fees higher for fans, the department said.

If the government prevails, officials said, U.S. consumers could in the future pay lower prices because a broader range of companies could offer tickets to shows. That added competition could drive down the extra fees that Ticketmaster adds to the total price of seeing a show, the Justice Department said.

“We allege that Live Nation 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,” Attorney General Merrick Garland said. “It is time to break up Live Nation.”

Live Nation shares declined more than 6.5% Thursday morning.

The company said Thursday that it doesn’t have a monopoly in ticketing or promotion and will fight the government’s case. Ticketmaster doesn’t set prices, according to the company, artists and teams do, and they are subject to high demand and low supply, while the majority of fees go to venues.

The department “will lose in court because it ignores the basic economics of live entertainment, such as the fact that the bulk of service fees go to venues, and that competition has steadily eroded TicketMaster’s market share and profit margin,” Live Nation said.

Among the practices the department challenges are long-term ticketing contracts that Ticketmaster has with venues where high-profile acts perform. Ticketmaster is a subsidiary of Live Nation. Those agreements typically run between three and five years and Ticketmaster often gives lucrative financial advances that entice the venues to sign up for long-term deals.

Live Nation tried to engage the department in settlement talks before the suit was filed, according to a person familiar with the process. The department didn’t want to entertain the company’s offers such as reducing or removing its exclusive ticketing contracts with venues, the person said.

Live Nation also prevents rival promoters from booking the venues that it owns or operates, which constrains supply, putting more pressure on prices, the government said. Live Nation owns or operates some 370 venues or festival sites globally, allowing it to route the tours it promotes through its own buildings.

The company’s exclusive contracts prevent new and different competitors in both concert promotion and ticketing as well as new business models from emerging, the complaint says. Such pacts block venues from using multiple ticketing services, who the government says would compete by offering better prices, fees, quality and innovation to fans.

The lawsuit claims that Live Nation cooperated too closely with some rivals including Oak View Group, an operator of stadiums, arenas and convention centers. The department says Oak View Group avoided bidding against Live Nation to attract tours and influenced venues to sign exclusive agreements with Ticketmaster.

The Justice Department’s move represents a second chance to challenge Live Nation’s structure. The government didn’t try to block its merger with Ticketmaster in 2010.

Department officials didn’t spell out Thursday how they want the company to be broken up, but analysts expect it would seek to separate Live Nation’s concert-promotion business from Ticketmaster.

The Justice Department has been investigating Live Nation since 2022, according to people familiar with the matter. The probe gained momentum in November of that year after Ticketmaster crashed during a fan presale of Taylor Swift’s “Eras Tour.”

Live Nation has faced accusations of exorbitant ticket fees, flawed customer service and anticompetitive practices from lawmakers, regulators and state attorneys general. The company wields commercial advantages that most of its competitors lack. Live Nation has a roughly 50% market share in concert promotion, while Ticketmaster controls more than 80% of the market for primary ticket sales in the biggest venues in the U.S.

The Justice Department’s claims about Live Nation’s relationship with Oak View Group stems from communications between the two companies that suggest they agreed to not encroach on one another’s turf.

In 2016, for instance, Live Nation’s chief executive emailed Oak View when he heard the company was bidding to promote an artist whose shows Live Nation had handled, according to the department’s court complaint. “We have done his [touring] and Vegas. Let’s make sure we don’t let [the artist’s agency] now start playing us off,” he wrote.

Write to Dave Michaels at [email protected] and Anne Steele at [email protected].