Ticketmaster agreed to pay a $ 10 million fine after being accused of illegally accessing a competitor’s computer systems repeatedly between 2013 and 2015 in an attempt to “cut” [the company] the knees. “
A subsidiary of Live Nation, a California ticketing and sales company, used the stolen information to gain an advantage over CrowdSurge – which merged with Songkick in 2015 and subsequently acquired by Warner Music Group (WMG) in 2017 – by hiring a former employee to enter its instruments and obtain information about the company’s operations.
“Ticketmaster employees have repeatedly – and illegally – accessed the computers of an unauthorized competitor using stolen passwords to illegally collect business information,” said Seth DuCharme, the US prosecutor in office.
“Furthermore, Ticketmaster employees brazenly organized a division-wide” summit “at which stolen passwords were used to access the victim’s company’s computers, as if it were a proper business tactic.”
The allegations were first reported in 2017, after CrowdSurge sued Live Nation for antitrust violations, accusing Ticketmaster of accessing confidential business plans, contracts, customer lists and credentials of CrowdSurge tools.
According to court documents released Dec. 30, after being hired by Live Nation in 2013, Stephen Mead, who was CrowdSurge’s chief operating officer in the U.S., shared the passwords with Zeeshan Zaidi, the former head of the artists’ services division. Ticketmaster, and another Ticketmaster employee. to Artist Toolbox, an application that provides real-time data about tickets sold through the victim company.
In addition to stealing passwords, Mead is also accused of providing “internal and confidential financial documents” withheld from his former employer, as well as URLs for designing ticketing web pages, to find out which artists planned to use CrowdSurge. to sell tickets and “discourage” them. from doing this.
On October 18, 2019, Zaidi pleaded guilty in a case of conspiracy to commit computer intrusion and fraud by participating in the scheme, stating: “We should not overthrow anyone that we have this opinion [the victim company’s] Activities. “
An unnamed Ticketmaster executive said in an internal email that the goal was to “suffocate” and “steal” its signatory customers by regaining the ticketing business for a second major artist who was a customer. at CrowdSurge.
Both Mead and Zaidi are no longer employed by Ticketmaster.
Ticketmaster has previously settled a lawsuit filed by Songkick in 2018 by agreeing to pay the company owners $ 110 million and purchase the remaining intellectual property that was not sold to WMG for an undisclosed amount.
In addition to paying $ 10 million in penalties, Ticketmaster is expected to maintain a compliance and ethics program to detect and prevent such unauthorized purchases of confidential information from its rivals.
The company will also be required to report annually to the US Attorney’s Office over the next three years to ensure compliance.