A coalition of more than 30 states, most of which objected to a settlement between the Justice Department and Live Nation, the concert giant that includes Ticketmaster, will resume an antitrust case on Monday in Federal District Court in Manhattan.
Following three days of testimony that included venue operators testifying that Live Nation employees had threatened to retaliate against them unless their venues signed contracts with Ticketmaster, the trial was abruptly paused after Live Nation and the Justice Department announced in court on Monday morning that they had reached a settlement deal.
The judge overseeing the case, Arun Subramanian, had urged the states to negotiate with Live Nation this week to reach a possible settlement, but the majority of them came to no deal.
The trial will resume with the same jury that was sworn in this month. The witness who was in the middle of testimony last Friday, Jay Marciano, the chief executive of AEG Presents, Live Nation’s biggest corporate rival, is expected to return to the stand to continue his questioning.
The suit brought by the Justice Department two years ago, and ultimately joined by 39 states and the District of Columbia, accused Live Nation of illegally maintaining a monopoly in the live entertainment industry that had stifled innovation and competition, and resulted in higher ticket prices for consumers. Live Nation denied it is a monopoly and says it does not threaten venues.
A “term sheet” outlining the deal had been signed on March 5 by Omeed A. Assefi, the acting head of the Justice Department’s antitrust division, and Michael Rapino, the chief executive of Live Nation. But the existence of their deal was not immediately revealed to the court, and so testimony continued the following day.
Judge Subramanian was livid when he learned that the settlement had not been disclosed to the court in a timely manner. “It shows absolute disrespect for the court, the jury and this entire process,” he said in open court on Monday, outside the presence of the jury. “It is absolutely unacceptable.”
In its term sheet with the Justice Department, Live Nation agreed to allow any promoter to put on concerts in their amphitheaters — reversing a longstanding policy that had blocked outside promoters — and to let venues use any ticketing vendor if they choose not to make an exclusive deal with Ticketmaster.
The agreement also set aside a fund of up to $281 million for states that opt in to that settlement. But it was unclear how much of that fund would be made available to the states that join the Justice Department’s settlement.
Various attorneys general called the settlement terms insufficient to address the antitrust issues raised at trial.
The deal “falls far short of protecting consumers, artists and venues from the harms that Live Nation and Ticketmaster have caused,” Andrea Joy Campbell, the attorney general of Massachusetts, said in a statement after the settlement was revealed.
A total of 26 states, along with the District of Columbia, filed a motion for a mistrial this week, seeking a new jury and additional time to prepare their case. On Friday, the states withdrew their motion.
In addition to Massachusetts, the states that remain plaintiffs in the case include New York, California, Tennessee, Colorado, Connecticut, Illinois, New Jersey, Virginia and Michigan.
Judge Subramanian said that any states who had signed on to the case would remain as plaintiffs unless they filed documents in court showing that they had settled with Live Nation, and assert that they understood they would be “fully bound” by those agreements.
A handful of states have reached settlement agreements with Live Nation, or are in the process of doing so, according to a representative of the Texas attorney general’s office, who said he had been authorized to speak on their behalf. Those states include Arkansas, Mississippi, Nebraska, Oklahoma and South Dakota. Two others, Iowa and South Carolina, are still negotiating.
The states continuing with the case have hired Jeffrey L. Kessler, an experienced lawyer known for cases involving antitrust and the business of sports, to represent the states as outside counsel.
Ben Sisario, a reporter covering music and the music industry, has been writing for The Times for more than 20 years.
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