A pair of executives from Endeavor abruptly resigned from the Live Nation Entertainment Board of Directors last week amid anti-trust concerns. Endeavor Chief Executive Officer Ariel Emanuel and President Mark Shapiro resigned their positions after the Department of Justice “expressed concerns that their positions on the Live Nation Board created an illegal interlocking directorate,” according to a DOJ press release.
Endeavor, which went public earlier in 2021 after a previously aborted attempt at doing the same, is a sprawling conglomerate of entertainment-focused operations, similar to its Beverly Hills, California neighbor, Live Nation. Its directly operated businesses include the UFC and On Location Experiences, which recently acquired a monopoly over Olympic ticketing for much of the next decade. Live Nation, of course, operates an enormous slice of the live event and venue business in the United States, as well as Ticketmaster.
Because of the similarities of the operations, the DOJ believed that executives from the newly public company would be in violation of Section 8 of the Clayton Act – which prohibits the same person serving as an officer or director of competing companies with certain execptions.
“These resignations ensure that Endeavor and Live Nation will compete independently.” says Acting Assistant Attorney General Richard A. Powers of the Justice Department’s Antitrust Division. “Executives are not permitted to hold board positions on companies that compete with each other. The division will enforce the entitrust laws to make sure that all companies compete on the merits.”
Anti-trust scrutiny is hardly new for Live Nation Entertainment. The company has been dogged by multiple accusations of anti-competitive behavior by competitors, despite entering a consent decree as a part of the approval of its merger with Ticketmaster more than a decade ago. That decree was extended in 2020 after a DOJ investigation found several significant violations by the company, which has seen stocks rise to record highs as the COVID pandemic restrictions are eased and events get back underway.
Endeavor is part of a conglomerate that continues to grow, with its own holdings joining corporate cousins (via parent company Silver Lake Partners) that include Madison Square Garden Company, Learfield/IMG, The Oak View Group, and Australian promotions giant TEG, which owns Ticketek.
Photo: Ari Emanuel, center, is the Endeavor CEO and was a longtime member of the Live Nation Entertainment Board of Directors prior to his abrupt resignation amide DOJ concerns that his participation constituted an illegal interlocking directorship between two competing companies. (Financial Times via Wikimedia Commons)