The Federal Antitrust Lawsuit Highlights The Cozy Relationship Between Stay Nation And Oak View Group

LOS ANGELES (CelebrityAccess) — The federal antitrust lawsuit in opposition to Stay Nation underscores the corporate’s shut relationship with Oak View Group (OVG), the venue administration and advisory firm launched by former Stay Nation chairman Irving Azoff and Tim Leiweke, the previous President and CEO of Anschutz Leisure Group, Stay Nation’s major U.S. rival.

When Oak View Group launched in 2015, it appeared poised to develop into a significant competitor to Stay Nation by reserving high artists for its managed arenas and different main live performance venues throughout the U.S., difficult Stay Nation’s dominance in main excursions. The launch of OVG led Stay Nation to explain the corporate as one among its “Largest Competitor Threats” shortly after OVG’s inception, in accordance with the federal lawsuit.

Nonetheless, that potential rivalry didn’t materialize, and in accordance with the Division of Justice (DOJ), this was not a coincidence.

The DOJ alleges that emails between senior executives of each firms reveal a detailed and coordinated relationship. OVG executives described the corporate as a “pimp” and “hammer” for Stay Nation, serving to to carry venues into the Stay Nation/Ticketmaster fold.

“I at all times shield you on rebates, promoter place, ticketing,” Tim Leiweke instructed Stay Nation CEO Michael Rapino in a single communication cited by the DOJ lawsuit.

Moreover, the federal lawsuit alleges that Oak View Group successfully ceded the live performance promotion enterprise to Stay Nation, whereas the promoter large backed away from the sector house to keep away from encroaching on OVG’s enterprise.

“It has been our coverage to remain on the sidelines in terms of shopping for and particularly selling tour dates as we’re cognizant to not compete with our companion Stay Nation on this aspect of the enterprise,” an Oak View Group Senior Vice President instructed a colleague through electronic mail, in accordance with the federal government’s lawsuit.

The DOJ cites a 2016 incident wherein the 2 firms labored to keep away from competitors in negotiations with artist representatives over a possible tour.

“What’s up? We’ve got accomplished his [touring] and Vegas[.] Let’s make certain we don’t let [the artist agency] begin enjoying us off,” Rapino purportedly instructed Oak View Group, with OVG’s Tim Leiweke responding, “Our guys acquired a bit forward. All know we don’t promote and we solely do excursions with Stay Nation.”

One other incident cited by the DOJ in 2022 adopted an analogous theme.

“Who can be so silly to do that and play into [the artist agent’s] arms?” Rapino reportedly wrote in an electronic mail to colleagues at Oak View Group. OVG CEO Tim Leiweke, responded, stating, “We’ve got by no means promoted with out you. Received’t,” and later added, “More than pleased to do these offers by LN as I’ve at all times been aligned,” and “I by no means wish to be rivals,” in subsequent emails, in accordance with the DOJ.

The DOJ’s swimsuit additionally claims that Oak View Group helps steer venues to Stay Nation’s Ticketmaster platform. In line with the swimsuit, OVG projected that it could transition not less than 22 venues to Ticketmaster over the following 4 years.

Oak View Group has not been accused of wrongdoing and isn’t a celebration to the lawsuit.

In response to the federal antitrust lawsuit, Stay Nation’s Dan Wall, Government Vice President of Company and Regulatory Affairs, addressed the corporate’s relationship with Oak View Group in a prolonged assertion launched on Thursday.

“The criticism makes two principal claims regarding Stay Nation’s relationship with the Oak View Group (OVG), a venue administration firm. The primary is disingenuous, as it’s premised on the concept OVG was a severe potential rival to Stay Nation in live performance promotion. OVG owns and manages venues. It has by no means been a live performance promoter, nor aspired to be one—which is exactly the purpose made within the electronic mail DOJ quotes. DOJ’s declare relies on two incidents wherein Stay Nation and OVG had been discussing what to do when an OVG venue needed to e book an occasional present itself on a darkish night time. To painting that as an settlement to not compete in live performance promotion is farcical—notably when the criticism defines the related promotions market as a marketplace for regional or nationwide excursions and explicitly disavows the suggestion that ‘self-supply’ of reveals from venue homeowners is a part of that market.

Regardless, OVG’s conduct as a venue operator is totally in line with each main area and stadium within the nation—they should have an in-house booker who helps fill in any other case darkish nights, however they’ve no real interest in systematically taking over the danger of ensures that may very well be within the thousands and thousands of {dollars} for a present or tens of thousands and thousands of {dollars} for a tour.

DOJ additionally claims it was anticompetitive for Ticketmaster to compete for and win a ticketing contract OVG provided. The speculation is that the contract gave Ticketmaster an unfair benefit in securing the enterprise of impartial venues that had been managed by OVG as a result of it creates monetary incentives for OVG to ‘advocate for’ Ticketmaster. However there may be nothing remotely anticompetitive about that. Business preparations that contain incentive or advertising and marketing funds are widespread all through this business (and plenty of others). Venue administration firms like OVG and ASM are able to advocate for quite a lot of service suppliers, together with however not restricted to ticketing firms. So there may be competitors for the enterprise alternatives at each the venues they personal, which they management, and the venues they handle, which they don’t management however can probably affect. Ticketmaster competed and received the contract on the deserves as a result of OVG decided it was the most effective ticketing system obtainable.”