A 2009 breach of contract lawsuit filed by ticket broker Chuck Lombardo against Ticketmaster was settled out of court this month, according to legal filings. The lawsuit had alleged that the ticketing giant reneged on a deal to buy Lombardo’s business after he had helped Ticketmaster with its secondary ticket market initiatives.
Terms of the settlement were not disclosed, but Lombardo’s Los Angeles-based attorney told TicketNews that the two sides mutually reached a satisfactory deal.
“The matter has been amicably resolved,” Larry Iser said. He declined to elaborate further. The case originally had been filed in Los Angeles Superior Court.
Lombardo, a 25-year veteran of the ticket resale industry, sued Ticketmaster for allegedly reneging on a promise to buy his business, the former Elite Entertainment, after he had done consulting work to help Ticketmaster develop its secondary ticket efforts through its TicketExchange and TicketsNow divisions.
After about a year of consultant work, Ticketmaster allegedly had Lombardo sign an employment contract as a prelude to buying his business, but then the company allegedly never acted on it. The amount Ticketmaster allegedly was going to pay Lombardo to buy the business was not disclosed. Since filing the lawsuit in the fall of 2009, Lombardo has relaunched the ticket brokerage as Dynamic Tickets and moved it from New Jersey to New York City.
In addition to the consulting work, Lombardo was one of the brokers Ticketmaster allegedly tried to use to muscle its way into the secondary ticket market as part of the “Project Showtime” scheme. He allegedly resold tickets on the secondary market on Ticketmaster’s behalf, tickets to several high-profile tours such as Van Halen, Def Leppard, Kanye West, Neil Diamond and New Kids on the Block. Those sales allegedly were seen partly as an exercise in how to price tickets.
Lombardo did not return a message seeking comment. Click here to view a copy of the original lawsuit.
Ticketmaster, which subsequently merged with Live Nation, allegedly offered Lombardo a three-year contract and a $1 million signing bonus if he signed the employment agreement, and it offered to pay all of Elite’s personnel costs, according to the original lawsuit. Ticketmaster also allegedly threatened to have Lombardo “blackballed” in the industry if he did not comply with its wishes, even though the two sides supposedly had not finalized the terms of the acquisition. But, after signing the employment agreement, Ticketmaster allegedly froze out Lombardo, according to the lawsuit, by not negotiating with him or returning his calls.
“In a nutshell, Ticketmaster used Plaintiffs’ knowledge and expertise contacts to build its secondary ticket platforms, inducing Plaintiffs to provide their services, knowledge, expertise, and contacts with false promises that Ticketmaster would acquire Elite and of full employment for Lombardo and Elite’s key employees with Ticketmaster. However, once Ticketmaster got what it needed and induced Plaintiffs, by means of false promises and economic duress, to sign the Settlement Agreement purporting to release any claims against Ticketmaster, and to accept less compensation than was owed for the services provided to Frontline and Ticketmaster, it ruthlessly cast Plaintiffs aside, without regard to the irreparable harm done to their business and to Lombardo’s ability to earn a living,” the lawsuit stated.