Live Nation and Ticketmaster have been accused of allowing scalpers to hoover up millions of tickets so they can be resold on Ticketmaster’s own resale platforms at a steep markups to customers.
A new lawsuit brought by the Federal Trade Commission and seven states accuses the country’s biggest concert promoter and ticketing website of engaging in “three illegal practices that injure artists, cause consumers to pay significantly more for event tickets, and benefit Defendant’s bottom line.” The first two are: Allegedly hiding fees from customers until they check out, a tactic described as a “bait and switch approach” to advertising prices; and allegedly allowing ticket brokers to “exceed” the limits artists place on the number of tickets people are allowed to purchase at once.
The third accusation is arguably the most significant, with the FTC accusing Ticketmaster and Live Nation of earning “hundreds of millions of dollars in revenue by systematically violating” the BOTS (Better Online Ticket Sales) Act. That law, as the suit notes, makes it illegal to sell tickets purchased “in circumvention of measures used to enforced” ticket-purchase limits or other purchasing rules.
Rather than enforce these rules, the suit alleges, Live Nation and Ticketmaster “knowingly allow, and in fact even encourage, brokers to use multiple Ticketmaster accounts to circumvent Ticketmaster’s own security measures and access control systems… so that those same brokers can then list the unlawfully purchased tickets on Defendants’ resale marketplaces.” This, the FTC continues, “drives up the price of tickets and leaves ordinary fans unable to access the finite pool of tickets available at their face value.”
The FTC also alleges that this effectively allows Live Nation and Ticketmaster to “triple dip” on ticket fees, raking in money: First, when brokers originally purchase tickets; then when those same brokers re-list those tickets; and then lastly when consumers purchase those re-listed tickets.
In a statement, FTC Chairman Andrew N. Ferguson highlighted the executive order President Donald Trump signed in March, which stated that the FTC must work with U.S. Attorney General Pam Bondi to make sure ticket resellers are following competition laws; that scalpers are in compliance with IRS rules; and that BOTS Act is enforced to keep scalpers from using computer programs to scoop up tickets.
Ferguson said the order was meant to “protect Americans from being ripped off when they buy tickets to live events, adding: ”American live entertainment is the best in the world and should be accessible to all of us. It should not cost an arm and a leg to take the family to a baseball game or attend your favorite musician’s show. The Trump-Vance FTC is working hard to ensure that fans have a shot at buying fair-priced tickets, and today’s lawsuit is a monumental step in that direction.”
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A representative for Live Nation did not immediately return Rolling Stone’s request for comment.
In a statement, Stephen Parker, executive director of the National Independent Venue Association, praised the lawsuit, saying it gave “credibility to what fans, artists, and independent stages have believed for years: Live Nation and Ticketmaster exploit their dominance not just in concert promotion and primary ticketing, but in the resale market as well.”
He continued: “This is not just bad business; it is deception and abuse of monopoly power. By turning a blind eye to scalpers, even giving them the tools to bypass limits and harvest tickets, Live Nation has acted as the promoter, the primary ticket seller, the artists’ manager, and the scalper.”
The FTC’s lawsuit significantly compounds Live Nation’s troubles with the federal government after federal prosecutors filed a massive antitrust lawsuit against the company last May. That case remains ongoing, with a judge rejecting Live Nation-Ticketmaster’s bid to dismiss a core element of the DOJ’s case this past spring.
The suit goes into great detail about Ticketmaster’s alleged preference for hiding fees from listed ticket prices. It cites internal documents going back to at least 2014 that show Live Nation and Ticketmaster “consistently chose to continue obscuring the true price of tickets after internal test results showed that accurate, transparent pricing would reduce sales.”
The FTC claims it wasn’t until this past May that the company announced “their intention to incorporate fees into listed ticket prices.” This was well into the agency’s investigation, the suit notes, and right before a new rule designed to combat unfair or deceptive fees went into effect.
This story is developing…
From Rolling Stone US
