The antitrust suit was filed on Thursday in the United States, accusing Ticketmaster and parent company Live Nation of running an illegal monopoly of live events in America.
Live Nation is primarily owned by Liberty Media, the parent company of the commercial rights to Formula 1, and chaired by Greg Maffei.
“We allege that Live Nation relies on unlawful, anticompetitive conduct to exercise its monopolistic control over the live events industry in the United States at the cost of fans, artists, smaller promoters, and venue operators,” read a statement from attorney general Merrick Garland.
“The result is that fans pay more in fees, artists have fewer opportunities to play concerts, smaller promoters get squeezed out, and venues have fewer real choices for ticketing services.
“It is time to break up Live Nation-Ticketmaster.”
Live Nation responded with a lengthy response on its website that said, in part: “The complaint—and even more so the press conference announcing it—attempt to portray Live Nation and Ticketmaster as the cause of fan frustration with the live entertainment industry.
“Despite admitting that ‘[t]he face values of tickets are typically set or approved by artists,’ it blames concert promoters and ticketing companies—neither of which control ticket prices—for high ticket prices.
“It ignores everything that is actually responsible for higher ticket prices, from rising production costs, to artist popularity, to 24/7 online ticket scalping that reveals the public’s willingness to pay far more than primary ticket prices.
“It blames Live Nation and Ticketmaster for high service charges—and just the fact that there are fees—but ignores that Ticketmaster retains only a modest portion of those fees.
“In fact, primary ticketing is one of the least expensive digital distributions in the economy.”
The development occurs at an awkward time for Liberty as it in in the midst of a planned acquisition of MotoGP’s commercial rights holder, Dorna.
For that deal to complete, it must be cleared by regulators in a number of markets, including Australia.
Speaking shortly after the announcement of the planned acquisition, senior Liberty figures were confident of getting the $7 billion deal across the line.
That included acknowledgment that when CVC Capital was forced to divest Dorna by the European Commision when it held both assets in 2006.
“The CVC decision, which is almost 20 years old, was never really followed up on in terms of any kind of in-depth investigation or appeal process – they chose to just quickly close and move on,” explained Renee Wilm, Liberty Media’s head of legal.
“So I think when you factor in that we are going to engage very quickly with the regulators, making all the points that Greg just very clearly articulated, and also just noting the changes in the media landscape over the last 20 years, we’re pretty confident we can get this done quickly and get the transaction cleared.”
Liberty Media’s intent is to run MotoGP as an entirely separate entity to Formula 1, though structure it within the broader Formula 1 Group.
Treating the two motorsport assets individually, without crossover, is a key point when it comes to getting the deal cleared by regulators and was stressed by Liberty Media CEO Greg Maffei.
The DOJ lawsuit raises questions over that deal as it suggests there are concerns within the United States about the anticompetitive practices of other aspects of Liberty Media’s interests.
That could result in regulators taking a dim view of Liberty Media, potentially resulting in the necessary approval not being granted.
Speedcafe has reached out to Liberty Media through Formula 1 for comment on the potential impact of the Live Nation suit on the MotoGP deal, though no response has been received.
It’s been a busy period for Liberty Media, which is also under fire over its rejection of Andretti Global’s effort to join the F1 grid.
Congress and the House Judiciary Committee had reached out in recent weeks requesting further details on that process and decision, a matter that has now been referred to the assistant attorney general.
Live Nation and Ticketmaster are active within Australia, the platform handling ticket sales for the Australian Formula 1 and MotoGP events.
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