Live Nation Trial Resumes: The ‘Velvet Hammer’ Returns
▼ Summary
– The antitrust trial against Live Nation-Ticketmaster resumed with state attorneys leading the case after the Justice Department settled, following the states’ withdrawal of their mistrial request.
– Testimony revealed Live Nation’s aggressive tactics, including using a “velvet hammer” approach to pressure competitors and maintain exclusive control over major venues and ticketing.
– Evidence showed Live Nation significantly increased its control over top U.S. amphitheaters, with company emails and presentations indicating strategies to limit competition and tighten negotiations.
– Live Nation’s president testified that profitability from large amphitheaters has nearly tripled since 2019, while defending the company’s practices as competitive rather than anticompetitive.
– The trial is expected to continue for several more weeks, with Live Nation’s CEO scheduled to testify as a high-profile witness following procedural adjustments.
The antitrust trial against Live Nation-Ticketmaster resumed this week with state attorneys general now leading the charge, following the U.S. Department of Justice’s unexpected settlement. Proceedings restarted smoothly after initial uncertainty, with the state legal team withdrawing a mistrial request once they secured necessary resources and expert testimony. The case continues from where it paused, delving into allegations of anti-competitive behavior in the live events industry.
Judge Arun Subramanian welcomed the jury back, questioning them about potential exposure to case-related media. He instructed jurors not to draw conclusions from the federal government’s departure, emphasizing that numerous states are continuing the legal battle. A new coalition of lawyers, co-led by New York Assistant Attorney General Jonathan Hatch and noted antitrust attorney Jeffrey Kessler, has taken over the prosecution.
Testimony resumed with further questioning of Jay Marciano, Chief Operating Officer of rival promoter AEG. Marciano discussed differing ticketing models between the U.S. and Europe, where venues more commonly use multiple ticketing services. Under cross-examination, he addressed a previously discussed phone call where Live Nation CEO Michael Rapino reportedly told Barclays Center executives that abandoning Ticketmaster could make it harder to book concerts. Marciano characterized such negotiations as standard industry practice for securing favorable terms, noting competition from newer venues like UBS Arena would naturally impact artist bookings.
A significant portion of the day focused on Live Nation’s control over major outdoor amphitheaters. Robert Roux, President of U.S. Concerts for Live Nation, faced questioning about whether this control creates a monopoly for large-scale outdoor tours. Plaintiffs presented internal documents showing the company’s expanding dominance. A 2018 presentation highlighted that Live Nation owned, operated, or exclusively booked 62 of the world’s top 100 amphitheaters, a number Roux confirmed has since grown.
The states introduced a series of internal emails to illustrate corporate strategy. In a 2015 email, Roux noted that many artists seek amphitheater tours and that this demand allowed for “room for tighter negotiations and deals.” Another pivotal 2018 exchange involved the potential acquisition of promoter Red Mountain Entertainment. Roux wrote that the message to Red Mountain should be clear: “Either we are together or we are competitors,” a tactic he internally termed the “velvet hammer.” On the stand, Roux stated this language was intended to be firm, not antagonistic. In a separate email, he cautioned against becoming “complacent” and letting “small guys encroach from the edges.” Live Nation ultimately acquired Red Mountain that same year.
Further evidence showed executives hesitating to allow third-party promoters into their venues, even when presented with profitable deals. In 2020, Rapino advised against permitting Radio Disney and promoter Superfly to use a Live Nation amphitheater despite a contract guaranteeing over $400,000 in profit, with one executive expressing concern about allowing a competitor access “even though the money is great.”
Roux also testified about the financial performance of these large venues, revealing that profitability in major amphitheaters grew more than any other venue category between 2019 and 2024. Before certain expenses, profit from large amphitheaters reached $386 million in 2024, nearly triple the 2019 figure.
Live Nation maintains its practices are competitive, arguing the states overlook numerous other venue types that host similar events. The trial’s pace remained consistent despite the shift in prosecution teams, with both sides streamlining witness lists to stay on schedule. The proceedings are expected to last several more weeks, with Live Nation CEO Michael Rapino anticipated to testify soon.
(Source: The Verge)
