Live Nation Trial Resumes with a ‘Velvet Hammer’ Approach
After a turbulent week, the antitrust trial against Live Nation and Ticketmaster resumed smoothly. This session saw various state attorneys leading the proceedings, following a mid-trial settlement involving the Justice Department. The attorneys initially sought a mistrial, fearing disruption could prejudice the jury. However, Judge Arun Subramanian indicated he would likely reject this request. Upon resolving concerns about their expert witness, the states withdrew their mistrial motion.
Key Developments in the Trial
The trial resumed, featuring testimony related to Live Nation’s strategies, including what has been termed the “velvet hammer” approach. Judge Subramanian welcomed jurors back and addressed concerns about potential media exposure during their break. He reiterated that the case would proceed without the DOJ and some states that settled.
Attorneys Leading the Case
- Jonathan Hatch from the New York Attorney General’s office
- Jeffrey Kessler of Winston & Strawn
The new legal team began questioning Jay Marciano, COO of AEG, a competitor to Live Nation. Marciano discussed ticketing practices in Europe, highlighting the difference in competition compared to the United States. In the U.S., venues often have exclusive agreements with Ticketmaster.
Allegations Against Live Nation
During cross-examination, Marciano touched on a conversation between he and Live Nation CEO Michael Rapino, who suggested that a new arena nearby could harm Barclays Center’s concert opportunities. Marciano noted that competition among venues is a normal practice in the industry.
Live Nation’s Market Control
Robert Roux, Live Nation’s president of U.S. concerts, addressed allegations regarding the company’s dominance over large outdoor venues. A presentation revealed that Live Nation had increased its stake in four of the top five amphitheaters in the nation since 2016. The company defended its practices by noting the existence of other venues that also compete for concerts.
Email Evidence of Competitive Practices
Evidence from emails illustrated Live Nation’s approach to competition. In a 2018 exchange, Rapino conveyed concerns about granting shows to a potential rival promoter, suggesting a mentality of “either we are together or we are competitors.” This tactic aligns with the “velvet hammer” strategy, a term used to describe their approach to negotiating with other promoters.
Financial Performance and Profitability
Roux detailed Live Nation’s financial growth, particularly in profitability from large amphitheaters. The company reported a profit of $386 million in 2024 for this segment, nearly tripling its earnings from 2019.
The trial is expected to continue for several more weeks, with efforts made by both sides to streamline their witness lists. Anticipation builds for Live Nation’s CEO to take the stand as one of the high-profile witnesses later this week.
