The Federal Trade Commission (FTC) has initiated a significant legal action against Ticketmaster and its parent company, Live Nation, accusing the companies of misleading consumers regarding ticket prices and colluding with scalpers to inflate resale prices. This lawsuit, filed on Thursday, underscores the FTC's commitment to protecting both artists and music fans from unfair practices in the ticketing industry.
The complaint has garnered support from several states, including Colorado, Florida, Illinois, Nebraska, Tennessee, Utah, and Virginia. FTC Chairman Andrew N. Ferguson emphasized the importance of accessibility in American live entertainment, stating, "American live entertainment is the best in the world and should be accessible to all of us. It should not cost an arm and a leg to take the family to a baseball game or attend your favorite musician's show."
The lawsuit, lodged in the U.S. District Court for the Central District of California, accuses Ticketmaster and Live Nation, the largest ticketing and live entertainment company in the country, of engaging in three primary illegal practices. The first allegation points to a bait and switch tactic, where ticket prices are initially advertised at deceptively low rates, only to surge by 30% or more during the checkout process due to hidden fees.
According to the FTC, Ticketmaster has profited immensely by misrepresenting the total ticket prices, leading consumers to spend billions annually on mandatory fees that are not disclosed in the original ticket listings. Despite artists setting prices and limiting ticket purchases to enhance accessibility, the FTC claims that Ticketmaster knowingly permits scalpers to breach these limits.
The lawsuit details how ticket brokers can acquire thousands of tickets for a single event and subsequently resell them on Ticketmaster's secondary market at significantly inflated prices. This practice is reportedly facilitated by Ticketmaster and Live Nation, which allow brokers to exploit multiple accounts to bypass security measures, violating the Better Online Ticket Sales Act.
While Ticketmaster has attributed the challenges fans face in obtaining tickets at face value to scalpers and bots, the FTC argues that Ticketmaster benefits from this arrangement by charging fees at multiple stages. These include initial sales to scalpers, subsequent resale listings, and final sales to consumers buying secondhand tickets. The FTC estimates that from 2019 through 2024, Ticketmaster has collected approximately $3.7 billion in fees on resale tickets.
As of now, Live Nation and Ticketmaster have not provided a response to requests for comment from NPR. This legal action follows an antitrust lawsuit filed by the Department of Justice and 30 states in 2024, which seeks to break up Ticketmaster and Live Nation due to concerns over an illegal monopoly in ticketing, promotion, venue ownership, and management, potentially leading to increased ticket prices.
Live Nation has previously stated that the DOJ's lawsuit will not effectively lower ticket prices for fans or resolve their concerns regarding service fees and access to highly sought-after shows. Instead, they argue that the real issue lies within the secondary market, where resellers inflate prices, extracting billions from the industry, ultimately affecting both artists and fans.
