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Ticketmaster fined $10m for ‘choking Songkick

World News
December 19, 2020

UNITED STATES

A CRIMINAL investigation into unfair competition by ticketing multi-national Ticketmaster (TM) has been resolved with the payment of a $10 million fine by the Live Nation Entertainment (LNE) subsidiary.

The payment represents the final chapter in a dispute lasting over five years with now-defunct newcomer Songkick, which provided direct-to-fan services for artistes including Paul McCartney, Adele, Metallica and Mumford & Sons.

TM had previously paid Songkick an out-of-court settlement of $11m, plus a “substantial” undisclosed sum for assets including its ticketing platform, anti-scalping algorithm and patents (see Audience issue 216).. However, the legal battle also attracted criminal charges when some of TM’s practices were made public.

In December, the company formally accepted a fine for “repeatedly and illegally access[ing] without authorization the computer systems of a competitor,” according to a statement by the US Attorney’s Office. It said the company had attempted to “choke off” its competitor.

As part of a deferred prosecution agreement TM must now operate an ethics programme designed to prevent similar transgressions in the future.

The attorney’s announcement explains how TM illegally accessed Songkick’s computers after a former employee of the smaller company provided stolen passwords and URLs, sharing up to 85,000 confidential documents. As reported in Audience (issue 205), that employee was Stephen Mead, former senior vice-president of CrowdSurge, acquired by Songkick in 2015.

In October 2019, TM’s former senior vice-president of artiste services, Zeeshan Zaidi, pleaded guilty to conspiring to commit computer intrusions and wire fraud in relation to the case. Court filings said that Zaidi accessed Songkick’s systems on “numerous occasions” between 2013 and 2015.

According to Acting US Attorney Seth. D DuCharme, “Ticketmaster’s employees brazenly held a division-wide ‘summit’ at which the stolen passwords were used to access the victim company’s computers, as if that were an appropriate business tactic.

“Today’s resolution demonstrates that any company that obtains a competitor’s confidential information for commercial advantage, without authority or permission, should expect to be held accountable in federal court.”

 

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