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Booking war: Ozzy sues AEG over “blatant anticompetitive conduct”

The Osbournes have followed through on their threat to bring legal action against AEG over its O2-Staples block booking, a policy they say is illegal under antitrust law

By Jon Chapple on 22 Mar 2018

Ozzy Osbourne, Facundo Gaisler

image © Facundo Gaisler

Ozzy Osbourne has brought legal action against for AEG for its block booking policy between The O2 and Staples Center, alleging that forcing artists to play both venues is an “explicit”, “brazen” violation of US competition (‘antitrust’) law.

In a class-action lawsuit filed yesterday in the US district court for central California, lawyers for Osbourne (real name John Michael) claim AEG’s policy of requiring acts who want to perform at the 20,000-cap. O2 Arena in London to also play Staples Center (21,000-cap.) in LA – allegedly dubbed the ‘Staples Center Commitment’ by AEG – is an “unlawful tying arrangement that unfairly leverages AEG’s dominance in greater London to distort and deter competition in greater Los Angeles”.

It is the latest twist in the long-running ‘booking war’ between AEG and Madison Square Garden Company/Live Nation – the latter of which has a similar tying of Madison Square Garden in New York and the Forum in LA – and marks the first legal action challenging the practice. A complaint lodged by Live Nation in the UK aimed at ending the so-called Staples Center Commitment was dismissed by the Consumer and Markets Authority (CMA) last December.

Osbourne (pictured), represented by San Francisco’s Latham & Watkins, aims, “on his own behalf and for all similarly situated artists, to prohibit AEG from enforcing the Staples Center Commitment”. The suit also seeks legal fees and “all other relief the court may deem proper and just”.

“The harm to competition from the Staples Center Commitment is profound, immediate and irreparable”

“The harm to competition from the Staples Center Commitment is profound, immediate and irreparable,” alleges the suit, “and must be enjoined”.

The lawsuit follows follows an open letter sent by Osbourne’s wife, Sharon, to AEG last month demanding the end of the block-booking policy and accusing AEG of “bringing artists into a power struggle you’re having with your competitor, Live Nation”.

After revealing AEG had sent Osbourne’s tour promoter, Live Nation, an agreement which “clearly states that Ozzy cannot play at The O2 in London unless we legally agree to play at Staples Center in Los Angeles”, Sharon warned: “If you do not confirm the date for Ozzy at The O2 in London then I will be forced to take legal action against AEG [Presents] without delay.”

Court documents make clear The O2 is at the centre of the dispute, with Latham & Watkins’ Daniel Wall, Timothy O’Mara and Andrew Gass describing the arena as “a singular concert venue – the only indoor arena in London with the capacity to host major concerts. The O2 is a ‘must-have’ venue for the top international touring artists, as witnessed by the steady stream of marquee artists who play The O2 annually.”

“This suit is without merit and we will vigorously fight it”

AEG – which also operates Wembley Arena (12,500-cap.) and the Eventim Apollo (5,039-cap.) – is, therefore, “a clear monopolist in the market for arena-sized venues in greater London”. That’s a situation set to continue for at least the next few years, although Madison Square Garden Company’s hotly anticipated new MSG Sphere London venue will shake up the market when it opens sometime around 2020.

In a statement provided to IQ, Jay Marciano, chairman and CEO of AEG Presents, responds: “This suit is without merit and we will vigorously fight it. We welcome a closer look at the global live entertainment market and, specifically, our practices and the practices of our competition.

“AEG has always worked hard to put artists first. At the same time, we must respond to the actions of those we compete with, specifically Live Nation and Madison Square Garden. Fighting for a level playing field is fair competition at its core.”

 


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