The U.S. Supreme Court won’t hear a case against Live Nation over the company’s use of arbitration agreements for ticket buyers, leaving in place a ruling last year that called the provisions “opaque and unfair.”
The concert giant had asked the justices to tackle the case and overturn that strongly-worded decision, arguing it “creates massive uncertainty” for the many companies that have long required consumers to sign such clauses.
But in an order issued Monday, the Supreme Court denied Live Nation’s request; as is typical, it did not issue any explanation for the decision. The justices hear only a tiny fraction of the thousands of petitions they receive each year.
Related
Filed as a class action in 2022 on behalf of “hundreds of thousands if not millions” of ticket buyers, the lawsuit claims Live Nation and Ticketmaster violated federal antitrust laws by abusing their dominance to charge “extraordinarily high” prices to consumers.
Faced with those allegations, Live Nation argued that fans had waived their right to sue in court when they bought their tickets because they had signed arbitration agreements — a common requirement when purchasing tickets and other services from many companies.
In rejecting that argument in October, the U.S. Court of Appeals for the Ninth Circuit ruled that Live Nation’s agreements were “unconscionable and unenforceable” since they would make it “impossible” for fans to fairly pursue claims against the company.
The criticism centered on Live Nation’s decision to alter its terms of use to require fans to submit to “mass arbitration.” Offered by an upstart arbitration firm called New Era ADR, the new process was aimed at handling many cases at once rather than individually, which Live Nation believed was necessitated by aggressive tactics from lawyers representing huge numbers of concertgoers. But the appeals court said it was clearly unfair to the fans.
“Forced to accept terms that can be changed without notice, a plaintiff then must arbitrate under … opaque and unfair rules,” the appeals court wrote at the time. “The rules and the terms are so overly harsh or one-sided as to unequivocally represent a systematic effort to impose arbitration as an inferior forum.”
In asking the Supreme Court to review that ruling, Live Nation called it a “deeply flawed decision” that exemplified the kind of “judicial hostility” to private arbitration that’s prohibited under federal law.
“The Ninth Circuit’s decision below flouts [federal arbitration law], defies this court’s precedents, and threatens to block sensible measures for addressing the new phenomenon of mass arbitration filings,” the company’s lawyers wrote.
Following the Supreme Court’s rejection of the case, the lawsuit will now return to a federal court, where the concertgoers’ antitrust allegations against Live Nation will now proceed into litigation. Neither side immediately returned requests for comment on Monday.
