Clear Channel is being targeted by several people for what they claim as unfair practices. What exactly did they do and who exactly is suing? Let's just say the Backstreet Boys may not be back.
Clear Channel Communications is about to hear something they won't like: a class action lawsuit.
According to reports, Judge Stephen V. Wilson of Los Angeles has allowed a class action lawsuit by concert goers accusing Clear Channel Communications in using predatory practices to keep ticket prices expensive. Beth Fegan, an attorney from Hagens, Berman, Sobol, and Shapiro,
claims the lawsuit shows Clear Channel is
"...leveraging its size and industry clout to exploit consumers and artists by eliminating the choices available to them and keeping ticket prices and concert promotion rates unreasonably high."
Plaintiffs span 23 different regions across the country. They have bought tickets from either Clear Channel or its subsidiaries for concerts featuring Bruce Springsteen, Madonna, Eric Clapton, Elvis Costello, The Who, and Billy Joel.
The lawsuits intend to show that ticket prices were raised at a disproportionate rate. Although ticket prices went up 61% since 2002, the Consumer Price Index only rose 13%.
The lawsuit only utilized five test regions so far for certification. All five regions were found certifiable in a unanimous decision by the court. Anyone who purchased a live rock concert ticket in Chicago, New England, New York/New Jersey, Colorado and Southern California between June 19, 1998 and today are included in the suit. There are 18 more regions that plaintiffs feel will be certified at a later date.
There are five class action lawsuits facing Clear Channel, claiming that the company pays artists such high fees that other companies cannot compete. One example was Clear Channel's handling of a Backstreet Boys Tour, according to one suit. Clear Channel bought the tour for $100 million, keeping other promotion companies from competing. That enabled Clear Channel to charge high prices for the concert as opposed to what local promoters would have charged.
Clear Channel Communications also allegedly owns a monopoly on radio, music's best promotion tool. Clear Channel began buying radio stations across the country before the anti-monopolization laws were put into place. Artists, according to the suit, have no choice but to promote their works and tours on stations owned by Clear Channel; if an artist wants to play on another station it is nearly impossible.
"We intend to show that Clear Channel bullies groups into using Clear Channel's facilities for concerts through its market dominance of the airwaves," Fegan noted. "The upshot is that if bands don't use Clear Channel venues, they will be playing to empty houses."
