Live Nation-owned Ticketmaster has agreed to pay a $10 million (£7.3m) criminal fine, in the US, to avoid prosecution on charges it unlawfully used passwords to access a rival’s computer systems to “choke off” its business.
The fine is part of a deferred prosecution agreement that Ticketmaster has entered into with the United States Attorney’s Office for the Eastern District of New York to resolve five criminal counts including conspiracy, computer intrusion and wire fraud.
Prosecutors said that from August 2013 to December 2015, Ticketmaster repeatedly used stolen passwords to acquire confidential information from a rival by unlawfully accessing its computer systems.
The only details revealed about the rival ticketing company was that it was UK-based with an office in Brooklyn, but according to Bloomberg details in court suggested it was Songkick.
In January 2018, Live Nation Entertainment paid Songkick $110m to settle a lawsuit filed by the company, and paid it an additional undisclosed sum to acquire its assets.
Acting US Attorney Seth D. DuCharme said, “Ticketmaster employees repeatedly – and illegally – accessed a competitor’s computers without authorisation using stolen passwords to unlawfully collect business intelligence.
“Further, Ticketmaster’s employees brazenly held a division-wide ‘summit’ at which the stolen passwords were used to access the victim company’s computers, as if that were an appropriate business tactic. Today’s resolution demonstrates that any company that obtains a competitor’s confidential information for commercial advantage, without authority or permission, should expect to be held accountable in federal court.”
According to the United States Attorney’s Office, the former head of Ticketmaster Artist Services Zeeshan Zaidi pled guilty on 18 October 2019 in a related case to conspiring to commit computer intrusions and wire fraud based on his participation in the same scheme. Ticketmaster sacked Zaidi in October 2017. He has yet to be sentenced.
Ticketmaster said, “We are pleased that this matter is now resolved.”