Live Nation Beats Antitrust Lawsuit Over Allegations of ‘Predatory’ Behavior
Written by djfrosty on February 13, 2023
A federal appeals court on Monday (Feb. 13) rejected an antitrust lawsuit accusing Ticketmaster and Live Nation of exploiting its “impregnable market power” to foist inflated prices on hundreds of thousands of fans, ruling that concertgoers forfeited their right to sue when they bought their tickets.
In a 24-page ruling, the U.S. Court of Appeals for the Ninth Circuit upheld an earlier ruling that dismissed the proposed class action, saying that when the fans purchased their tickets, they had agreed to settle any disputes with Ticketmaster via private arbitration rather than in open court.
On appeal, attorneys for the plaintiffs had challenged the validity of that agreement, arguing it had not been presented clearly enough to customers. But in Monday’s decision, the appeals court was unswayed.
“At three independent stages — when creating an account, signing into an account, and completing a purchase — Ticketmaster and Live Nation webpage users are presented with a confirmation button above which text informs the user that, by clicking on this button, ‘you agree to our Terms of Use,’” Judge Danny J. Boggs wrote for a panel of three judges. “A reasonable user would have seen the notice and been able to locate the terms via hyperlink.”
The ruling came as Live Nation and Ticketmaster are facing heightened scrutiny over their market power in the wake of a disastrous November rollout of tickets to Taylor Swift’s Eras Tour.
The incident, which saw widespread service delays and website crashes, has prompted calls from lawmakers in Washington D.C. to break up Live Nation and Ticketmaster, which merged to create their current structure in 2010. It has also spawned investigations from attorneys general around the country and at least two antitrust class actions. The DOJ is also reportedly investigating Live Nation for antitrust violations, though the probe predated the Swift tour debacle.
The case decided on Monday was filed back in 2020 but raised similar accusations to critics who have spoken out in the wake of the Swift incident. Aiming to represent “hundreds of thousands if not millions” of customers, the proposed class action alleged that Live Nation’s dominance allowed it to increase prices for consumers and perform other “predatory acts” — calling it a “monster” that “must be stopped.”
“Defendants’ anticompetitive scheme has been wildly successful and today threatens to put nearly all ticketing services for major concert venues (primary and secondary) in the United States under Ticketmaster’s monopolistic thumb,” the accusers wrote in their April 2020 complaint.
But the case was quickly tossed out. A federal judge ruled in 2021 that Live Nation and Ticketmaster users had clearly assented to a form of so-called clickwrap agreement — a common online tool that presents users with terms of service before proceeding — that required them to resolve any such claims against Live Nation via a private arbitration process.
Monday’s ruling upheld that decision for Live Nation. The appeals court said the company’s agreement was not the kind of “pure clickwrap” that offers users the clearest presentation of terms of service, but the court said it also was not “browsewrap” — a less effective form of user agreement where terms are “hidden in links located at the bottom of webpages.” Whatever the format, the appeals court said Live Nation’s version “did enough” to pass legal muster.
“Appellees’ notice is conspicuously displayed directly above or below the action button at each of three independent stages that a user must complete before purchasing tickets,” Judge Boggs wrote for the court. “Crucially, the ‘Terms of Use’ hyperlink is conspicuously distinguished from the surrounding text in bright blue font, making its presence readily apparent.”
The ruling will effectively end the current case, but a second similar lawsuit against Live Nation (filed by the same team of attorneys from the law firm Quinn Emmanuel) based on slightly tweaked allegations is still pending in a lower federal court.
Both a representative for Live Nation and an attorney for the plaintiffs did not immediately return a request for comment on the Ninth Circuit’s ruling.