Live Nation Ticket Monopoly Lawsuit: Fans Score Potential Win

A recent court hearing could be a game-changer in the fight against high concert ticket prices. In a twist that could rewrite the rules for companies like Live Nation, a California Supreme Court precedent might be making a comeback.

Here's the backstory: Fans are furious. They accuse Live Nation, the giant behind Ticketmaster, of using its dominance to squeeze out competition and inflate ticket prices. This isn't just a hunch. A class action lawsuit by concertgoers alleges exactly that.

Live Nation's "Mass Arbitration Maze" Backfires?

Live Nation, like many companies, loves arbitration. It's a faster, supposedly cheaper way to settle disputes outside of court. However, the company designed special rules for mass arbitration – a scenario where thousands of fans file similar claims. Concertgoers' lawyers argue these "Kafkaesque" rules are unfair and designed to discourage them from pursuing claims.

Here's where it gets interesting. Reuters reports that the lawyers for the fans pulled out a surprising argument by reviving a 2005 California Supreme Court decision in Discover Bank v. Superior Court. In that case, the court ruled that companies cannot force customers to waive the right to litigate as a group through class action lawsuits. 

However, this win was short-lived. A 2011 U.S. Supreme Court decision in Concepcion v. AT&T Mobility overturned the Discover Bank ruling. The court concluded that the Federal Arbitration Act (FAA) preempts state laws like California's that restrict the enforceability of arbitration agreements. 

This meant companies could once again force customers into arbitration, potentially limiting their ability to fight back against unfair practices.

Fans Argue: Live Nation Broke the Rules

However, the fans' lawyers argue there's a crucial distinction. They point out that the Concepcion decision was based on the assumption that arbitration would be a traditional, streamlined process – a one-on-one dispute resolution between a company and a customer. Live Nation's complex mass arbitration system, they argue, strays far from this vision.

By making mass arbitration complicated and potentially more expensive for fans to pursue claims, Live Nation allegedly undermines the core purpose of arbitration envisioned by the Supreme Court. The fans' lawyers argue that by creating this complex system, Live Nation essentially loses the protection of the FAA, and California's Discover Bank rule against class action waivers could still apply.

This is a bold claim, and as Reuters reported, during a recent court hearing, a judge seemed to be intrigued. He questioned whether Live Nation's mass arbitration system even falls under the category of arbitration protected by federal law.

Of course, Live Nation isn't taking this lying down. They argue their mass arbitration system is simply a way to manage a complex situation efficiently. However, if the court sides with the fans, it could force companies to choose: offer traditional individual arbitration for each claim, which could be very expensive for the company, or allow fans to band together in a class action lawsuit.

Case Details

• Lawsuit: Leifer v. Live Nation Entertainment Inc.
• Case Number: 1:24-cv-03994
• Court: U.S. District Court for the Southern District of New York

Plaintiffs' Attorneys

• Israel David LLC