Class Action Accuses Live Nation of Withholding Tickets

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Last week, a putative class action was filed against Live Nation Entertainment Inc. alleging that the ticket seller sets aside a portion of available event tickets, driving customers to buy tickets from overpriced scalpers to obtain entrance to concerts and other events.

New Jersey residents Steven Glickman and Andrew Kimmel allege in their class action lawsuit that Live Nation has been “withholding” a portion of available tickets for events held at various New Jersey venues, including Boardwalk Hall, the Izod Center, Prudential Center, and Metlife Stadium since 2008. The plaintiffs allege further that Live Nation’s practice of withholding violated the Consumer Fraud Act.

According to the class action lawsuit, Live Nation sets aside a percentage of tickets for “connected insiders.” The regular consumer, the plaintiffs allege, must buy tickets from scalpers for a steep surcharge.

In the class action lawsuit, the plaintiffs point to several examples where Live Nation withheld a percentage of tickets to events, including a Maroon 5 concert where the plaintiffs allege that regular tickets peaked at $121, while secondary market tickets ranged from $290 to $460.

“The effect of defendants’ withholding of tickets from sale to the public is the limitation of available seats that the general public can purchase at face value, which increases demand for tickets and ticket prices in the secondary market,” alleged the plaintiffs in the Live Nation class action lawsuit.

The plaintiffs point out that tickets to Phish and Jimmy Buffett concert tickets were also subject to withholding practices by Live Nation. According to the class action lawsuit, Live Nation enters into agreement with secondary ticket dealers, including VIP Packages, Official Platinum Seats, TicketsNow, and TM+, to provide these dealers with large blocks of tickets prior to public availability.

The secondary ticket dealers then allegedly sell these tickets at a steep markup. The plaintiffs allege further that Live Nation provided a chart listing venues hosting a concert along with which tickets to withhold for that concert.

“Simply put, defendants are providing the best tickets to venues, artists and ticketing companies, who are then scalping those tickets to general public for more than face value,” allege the plaintiffs in the Live Nation class action lawsuit.

According to the Live Nation class action lawsuit, this practice has been under review by the Ticket Brokering Study Commission established by the governor of New Jersey in 1997. The plaintiffs allege that a 2001 report concludes that withholding tickets “disproportionately affect the general public’s opportunity to obtain tickets in favor of privileged insiders.” Further, the commission reportedly recommended that the practice be eliminated or curtailed and, as a result, the New Jersey Legislature enacted a Consumer Fraud Act provision requiring that 95 percent of all tickets be made available to the public.

The Live Nation class action lawsuit seeks injunctive relief, damages, compensation, interest, disgorgement, costs of suit, and treble damages and attorneys’ fees.

Glickman and Kimmel are represented by Bruce H. Nagel of Nagel Rice LLP.

The Live Nation Class Action Lawsuit is Glickman, et al. v. Live Nation Entertainment Inc., Case No. 2:15-cv-08041, in U.S. District Court for the District of New Jersey.