Live Nation Entertainment has reached an agreement with the Justice Department to extend restrictions that were placed on its 2010 merger with Ticketmaster, including a provision that prohibits retaliation against concert venues for using another ticketing company.
The agreement was reached after the Justice Department concluded that Live Nation violated restrictions placed on its merger, which combined ticket, promotion, concert and management businesses. The merger restrictions, set out in a consent decree, were to last until 2020. The new agreement extends them by 5 1/2 years.
“We have reached an agreement in principle with the Department of Justice to extend and clarify the consent decree,” Live Nation Entertainment said in a statement on Thursday. “We believe this is the best outcome for our business, clients and shareholders as we turn our focus to 2020 initiatives.”
The Justice Department’s Antitrust Division said that the agreement was “the most significant enforcement action of an existing antitrust decree by the Department in 20 years.”
The DOJ claimed that Live Nation “repeatedly and over the course of several years engaged in conduct that, in the Department’s view, violated” the consent decree.
“When Live Nation and Ticketmaster merged in 2010, the Department of Justice and the federal court imposed conditions on the company in order to preserve and promote ticketing competition,” said Makan Delrahim, the chief of the Antitrust Division. “Today’s enforcement action including the addition of language on retaliation and conditioning will ensure that American consumers get the benefit of the bargain that the United States and Live Nation agreed to in 2010. Merging parties will be held to their promises and the Department will not tolerate transgressions that hurt the American consumer.”
The DOJ filed a motion in the U.S. District Court in D.C. to modify the settlement agreement. The new agreement spells out the prohibitions on Live Nation’s business conduct, including withholding concerts from a venue if it chooses a ticketing firm other than Ticketmaster. It also restricts Live Nation from making threats to withhold concerts.
An independent monitor will oversee Live Nation’s compliance with the consent decree. Live Nation will be subject to a penalty of $1 million for each violation, and will pay the costs and fees for the DOJ’s investigation and enforcement.
Live Nation Entertainment’s stick price was up 9.19% to $69.83.