Live Nation Responds to Antitrust Battle with US Government

The Living Nation published its first official response to the US government’s antitrust lawsuit accusing the live fish giant of anti-competitive conduct and seeking to force the sale of its Ticketmaster business. In a letter to the court, the live streaming giant’s legal team highlighted a number of technical defenses, noting that the judge overseeing the case recently invited them to identify key issues that will form part of a future motion to dismiss.

We have already received some arguments from Live Nation’s public relations team against the accusations made by the US government. Ministry of Justicein that the company’s net profits do not suggest a monopoly, that the live events market is more competitive than ever, and that nothing the government department proposes will lower ticket prices. But the lawyers focused on legal formalities, not big, bold statements.

They say the government accuses Live Nation of creating an “illegal tying arrangement” between its amphitheater venues and its concert promotion business. But any exclusivity agreements between venues and the company’s promoters are actually protected, not prohibited, by U.S. federal competition law, also known as antitrust law. Meanwhile, the allegations that Live Nation violated state laws are vague and, in some cases, made too late.

A tying agreement, according to the Legal Information Institute, is “an agreement in which a seller makes the sale of one product (the ‘tying’ product) contingent on the buyer’s agreement to purchase a separate product (the ‘tied’ product).” Tying agreements are not necessarily illegal, but they can be if they are used to increase market power or weaken competition.

According to the attorneys, the Department of Justice alleges that Live Nation conditioned access to the amphitheaters it operates (the tying product) on the provision of concert promotion services (the tied product) whenever Live Nation did not allow other promoters to hold concerts at its facilities.

However, lawyers say, the government is actually describing a “refusal to cooperate” in which “Live Nation refuses to rent its amphitheaters to other promoters,” thereby securing a “competitive advantage in the promotion marketplace.”

They argue that such conduct is entirely legal. Citing legal precedent, they say that U.S. federal law “does not limit the long-recognized right” of the company “to exercise its own independent discretion as to whom it will do business with.”

The second part of the legal brief concerns state rights. When the U.S. government filed suit against Live Nation, it was accompanied by claims from 30 state attorneys general, 22 of whom accused Live Nation of violating state rights as well as federal law.

But, Live Nation’s lawyers say, “these claims are hackneyed and vague,” simply incorporating all of the allegations in the main complaint and then “citing state laws that defendants allegedly violated and asking for relief.”

“They do not state the elements of each state law claim and do not say what conduct is alleged to violate the challenged state rights.” So, in essence, “the current articulation of state law claims is legally flawed.”

Some of the state-level claims should also be dismissed under statutes of limitations, the legal filing also argues. The conduct complained about in the legal filings includes the 2010 merger of Live Nation and Ticketmaster, other acquisitions in 2016 and 2017, and correspondence between Live Nation and rival venue operator Oak View Group in 2016.

However, under the state laws that Live Nation is accused of violating, the longest statute of limitations is six years, meaning all claims are barred.

The U.S. Justice Department and state attorneys general have not yet responded to this week’s letter. But it seems certain that we can expect many additional legal issues to be raised as the litigation continues.