Live Nation Entertainment is once again under pressure over its arbitration practices, with a federal judge in New York granting ticket buyers the chance to investigate ties between the company, its powerhouse law firm Latham & Watkins, and arbitration provider New Era.
U.S. District Judge Arun Subramanian’s order allows limited discovery into how New Era operates, complicating Live Nation’s push to force claims of ticketing overcharges out of court and into private arbitration. Plaintiffs argue that the rules governing New Era arbitrations were crafted to shield Live Nation from class actions, with Robbins Geller attorney David Mitchell telling the court that the system was “designed to partner with corporations in an effort to limit class exposure.”
That argument echoes a California case where consumers successfully challenged Ticketmaster’s arbitration provisions. In that matter, plaintiffs claimed New Era functioned essentially as a “subsidiary” of Live Nation. While U.S. District Judge George Wu stopped short of endorsing that claim, he did cite “a remarkable degree of coordination” between Latham and New Era in shaping its rules — enough to block Live Nation from sending the case to arbitration. The 9th Circuit upheld Wu’s ruling, now pending before the U.S. Supreme Court.
New Era insists it is independent, saying it has “no relationship with Latham” and only serves Live Nation as one of many customers. The firm has also revised its rules since the California litigation. Live Nation, meanwhile, argues that the 9th Circuit’s decision has no bearing on the New York case, where it insists its updated arbitration terms are valid.
| READ MORE: Live Nation asks Supreme Court to end mass arbitration class action |
The development comes close on the heels of news that Ticketmaster’s newly revised Terms of Use remain “very close to the line” of violating the 9th Circuit’s arbitration ruling, according to legal experts. That overhaul, published quietly earlier this month, prompted fresh calls from industry stakeholders for arbitration reform and fairer consumer protections in ticketing.
READ MORE: Ticketmaster’s updated T&C’s “very close to the line” of violating arbitration judgement
With Subramanian’s order, both sides now have 90 days to exchange evidence before the court revisits whether Live Nation can force arbitration — or whether it must face its critics in open court.
