Ticketmaster sued in federal court for anti-trust violations
Monday, members of the rock band The String Cheese Incident joined representatives of their ticketing company, SCI Ticketing, and others at a news conference in New York City to explain the details of a lawsuit filed in the U.S. Federal Court in Denver last week.
SCI Ticketing filed the lawsuit claiming that ticketing giant Ticketmaster
has monopolized the ticketing industry, using its immense market power to prevent competition for the sale of concert tickets. SCI Ticketing is the first artist-centered ticketing company to sue Ticketmaster in federal court.
SCI Ticketing is owned by The String Cheese Incident and their management company, Madison House Inc., based in Boulder. Madison House is a management and booking agency that was started in 1996 with the vision of centralizing all of the music industry’s individual functions. SCI
Ticketing is one of the “family of businesses” located in the Madison House/String Cheese headquarters.
According to Neil L. Glazer, an attorney at the Philadelphia law firm, Kohn
Swift and Graf, P.C., who is leading the team of lawyers representing SCI
Ticketing in the lawsuit, SCI Ticketing “had no other recourse than to take
“SCI Ticketing has literally hit the wall in terms of being able to sell tickets directly to fans because of Ticketmaster’s anticompetitive practices,” Glazer said. “Our client has carved out a truly unique and successful way to do business. Unfortunately, they simply cannot compete because Ticketmaster is restricting the supply of concert tickets.”
Because Ticketmaster has exclusive dealing arrangements with so many venues and promoters, they have closed out independent, artist-driven ticketing companies like SCI Ticketing. This has made it increasingly difficult for Madison House to book bands such as The String Cheese Incident, who feel strongly about having the right to sell an allotment of their tickets directly to fans.
Glazer said that the antitrust violations alleged in the suit include:
nTicketmaster has entered into combinations, agreements, or conspiracies
with promoters, venues and others, in restraint of trade, in violation of
section 1 of the Sherman Antitrust Act.
nTicketmaster has monopolized, attempted to monopolize, or abused its
monopoly power in the market for the sale of tickets to popular music
concerts, in violation of section 2 of the Sherman Antitrust Act.
In addition, SCI Ticketing asserts a state law claim for tortious
interference with prospective business advantage.
“The decision to file this lawsuit was not one taken lightly,” Glazer added. “SCI Ticketing is a very small company, and Ticketmaster is one of the behemoths of the concert industry. By filing this lawsuit, SCI Ticketing is hoping to put a stop to anticompetitive practices that harm not only innovative young companies, but also artists and consumers.”
Mike Luba, co-founder of SCI Ticketing and a partner in Madison House Inc.,
said he believes that being able to compete in the concert ticketing industry is critical to his organization’s creative and business philosophy. “For bands like The String Cheese Incident,” explained Luba, “who depend on heavy touring and lasting fan relationships in order to succeed, services like direct artist-to-fan ticketing are essential. It allows fans to enjoy the complete String Cheese experience, from beginning to end. This involves giving the fans unprecedented attention for the essential part they play in the artists’ career, and being able to offer fans SCI performances in high quality venues and with affordable prices. Today, cultivating an artists’ fan base through such things as touring, creative internet communications, and how they sell tickets are some of the ways for bands to survive outside the music industry’s corporate machine. Bands like The String Cheese Incident rely on these tools for survival,” he added.
Keith Moseley, bassist/vocalist of The String Cheese Incident, said the band has aligned SCI Ticketing with their creative vision to fulfill a life-long dream.
“Its been a huge commitment – our touring and reinvesting and sacrifice,” said Moseley. “We hope this action sends the message loud and clear that monopolies like Ticketmaster cannot and will not be the only game in town; our fans deserve more than that.”
“We are not saying Ticketmaster doesn’t have a place in the ticketing
business, but we have a different philosophy of doing business, one that
caters more directly to our fans,” said Jason Mastrine, general manager of
SCI Ticketing. “Now, for the first time in our company’s history, Ticketmaster is preventing us from acquiring the same reasonable ticket
allocations we used to get from promoters and venues. There’s room for
everyone in the mix.”
According to Luba, the music industry is changing dramatically with many
artists wanting to take more control of their own careers.
“This involves everything from the labels they choose to who does their ticketing,” Luba continued. “But it’s not just about artists wanting to control their own destiny and providing better service to their fans, it’s also an economic issue. For many artists in today’s music industry, touring has become a much more important source of revenue than record sales because constant touring encourages community building and fan loyalty, which promotes a sustainable career.”
“The music industry is suffering right now, but there is no reason that the
artists and their fans have to go down with it,” said Luba. “We hope that the positive ramifications of filing this lawsuit will reach well beyond just The String Cheese Incident and their fans, and benefit everyone.”