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Live Nation — fighting legal battles on multiple fronts amid renewed scrutiny of its 2010 merger with Ticketmaster stemming from the company’s botched sale of tickets to Taylor Swift’s latest tour — has won a skirmish in an antitrust suit from consumers with a federal appeals court ruling that the case belongs in arbitration rather than court.
The Ninth Circuit Court of Appeals sided with Live Nation, finding that the company can arbitrate claims that it allegedly forced purchasers to pay inflated fees for tickets by leveraging its monopoly. The order issued on Monday affirms dismissal of the case.
The ruling may alleviate some of the pressure the ticketing giant faces as it grapples with escalating accusations from lawmakers and fans that it employs anticompetitive practices in the ticket resale market. The Department of Justice has opened an antitrust investigation into Ticketmaster, reported The New York Times in November.
Appealing a federal judge’s order dismissing the case, ticket purchasers argued that the arbitration agreement is invalid because it didn’t properly identify the legal names of the corporate entities, Ticketmaster and parent company Live Nation Entertainment, as parties to the contract.
A unanimous 9th Circuit panel sided with Live Nation that “California law doesn’t require corporate parties to a contract to use their full legal names.”
The panel added: “Even if California law required the recitation of a corporate entity’s full legal name, ‘Live Nation Entertainment, Inc.’ is explicitly referenced multiple times in the Terms, including in the arbitration clause itself.”
Instead of pursuing their claims in a prospective class action, ticket purchasers will have to do so before an arbitrator. Companies typically prefer arbitration because plaintiffs can’t team up and leverage others’ claims to negotiate big-money settlements.
Attorneys representing ticket purchasers in the suit may turn to filing arbitration claims en masse. The tactic has been used against companies that enforce such agreements. Under most policies, companies are required to pay legal fees for the proceedings.
In 2021, Amazon changed its terms of service to allow customers to file suits after plaintiffs’ attorneys hit the company with tens of thousands of individual arbitration demands.
One of the firms that spearheaded the legal strategy, Keller Lenkner, represents a plaintiff in the suit.
Ticketmaster and Live Nation merged in 2009, two years after the live-events organizer announced plans to build its own ticketing service. Prior to the deal, Live Nation was Ticketmaster’s largest customer.
Antitrust regulators approved the deal with certain conditions. They required Ticketmaster to sell its ticketing service subsidiary, Paciolan, to Comcast and to license its ticketing software to Live Nation’s competitor, AEG. The new company was also not allowed to bundle or retaliate against venues for working with other ticketing services.
But the Justice Department found in 2019 that Live Nation had been violating the terms of the settlement by forcing venues to accept Ticketmaster’s ticketing services as a condition for hosting Live Nation performers and retaliating against those that refused. The agency, in turn, threatened to assess monetary penalties for additional violations and installed a monitor tasked with investigating further breaches of the consent decree, which was extended until 2025.
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