Appellate panel rules Live Nation, Ticketmaster can’t force arbitration in ticket price lawsuit

Update: 

• A three-judge panel on the United States Court of Appeals for the Ninth Circuit affirmed a California federal judge’s decision that Ticketmaster and Live Nation cannot force consumers to arbitrate claims they charged excessive service fees on primary and secondary ticket sales. 
• Live Nation and Ticketmaster argue the claims in the ticket price lawsuit are identical to a separate complaint brought by the same counsel and already ordered into arbitration. 
• However, the three-judge Ninth Circuit panel ruled that arbitration terms on Ticketmaster’s website are “affirmatively misleading” and link to rules that are “borderline unintelligible.” 
• The consumers argue Live Nation and Ticketmaster helped create the rules set by the duo’s arbitrator, New Era, and claim said rules are biased against them.

Live Nation, Ticketmaster ticket fees class action lawsuit overview:

• Who: Four plaintiffs allege Live Nation and Ticketmaster charge consumers inflated service fees for tickets to events at major concert venues.
• Why: Live Nation and Ticketmaster have established such market dominance regarding primary and secondary ticket sales that they can charge consumers excessive service fees.
• Where: The class action lawsuit was filed in California federal court.

(Jan. 10, 2022)

Live Nation Entertainment Inc. and Ticketmaster LLC are facing a class action lawsuit alleging they are so dominant in the ticketing service industry that they essentially have a monopoly regarding the fees charged for ticket purchases.

Four plaintiffs filed the Ticketmaster class action lawsuit Jan. 4, claiming the defendants’ market dominance has resulted in consumers paying inflated service fees when purchasing tickets through Ticketmaster.

The Ticketmaster class action lawsuit asserts the same claims brought forth in 2020, which the defendants moved to compel arbitration. The plaintiffs say this is an “unusual case” because Ticketmaster allegedly “drastically altered” the arbitration agreement to one that “skews the odds so egregiously in Defendants’ favor” and is allegedly more unconscionable than the previous agreement.

‘Unparalleled’ market dominance allegedly enables Ticketmaster to charge excessive fees

In 2010, Live Nation and Ticketmaster merged and “acquired unparalleled dominance within the live music industry,” the lawsuit says. Ticketmaster was already a dominant provider of primary ticket services in the United States, and Live Nation is a promoter and manager for many of the biggest acts that tour in the country.

“The combined Live Nation/Ticketmaster behemoth has enormous, and unique, market power in primary ticketing and concert promotion services, and has shown it is unafraid to use that power,” the class action lawsuit states.

The lawsuit alleges Ticketmaster’s practices have harmed competition in the primary ticketing services market for major concert venues. Before the company existed, venues typically paid service fees for the ticket service provider. However, it shifted that model so that consumers paid the fees instead.

Ticketmaster also started paying venues substantial upfront fees to secure the rights to provide primary ticket services, incentivizing many venues to enter long-term contracts with the company. These tactics allowed Ticketmaster to gain a significant hold on the primary ticket services market for decades, the class action lawsuit alleges.

Because of its dominance in the market, Ticketmaster is able to charge inflated fees for both primary and secondary tickets, according to the monopoly class action lawsuit.

The plaintiffs point to evidence purportedly showing lower primary ticketing services fees in regions in which Ticketmaster does not have dominance to demonstrate the effects of its allegedly anticompetitive behavior.

The plaintiffs seek to represent themselves and a proposed class of consumers who purchased primary and/or secondary tickets and paid associated Ticketmaster fees for the ticketing services for an event at a major concert venue in the United States since 2010.

Do you think Ticketmaster charges inflated service fees? Tell us your thoughts in the comments!

The plaintiffs are represented by Frederick A. Lorig, Kevin Y. Teruya, Adam B. Wolfson and William R. Sears of Quinn Emanuel Urquhart & Sullivan LLP and Warren Postman and Albert Pak of Keller Lenkner LLC.

The ticket fees class action lawsuit is Skot Heckman, et al. v. Live Nation Entertainment Inc., et al., Case No. 2:22-cv-00047, in the U.S. District Court for the Central District of California.

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