SCI Ticketing, which was founded in 1998 as a partnership between The String Cheese Incident (SCI) and its managing company Madison House Inc, filed a lawsuit against Ticketmaster Corporation on Aug. 11, 2003, alleging that the company, through acquisition and abuse of long-term, exclusive agreements with venue owners, has attempted to foreclose SCI Ticketing from competing in the already scarce market.
Until recently, SCI has been provided by venues with as much as 50 percent of sellable tickets to its concerts. Ticketmaster acquiesced to this practice, and as the band grew in popularity, SCI Ticketing invested several hundred thousand dollars to set up its own user-friendly, low-cost ticketing system.
The lawsuit asks for damages and a court order barring Ticketmaster from the alleged anti-competitive practices.
Fearing that SCI's popularity might constitute competition (on average, a customer of Ticketmaster pays up to $10-15 in handling charges per ticket, as opposed to $4 per ticket from SCI Ticketing), Ticketmaster decided to step in. In May 2002, Ticketmaster sent letters to concert promoters and venues instructing them that they must either refuse SCI Ticketing any allotment or allow them a mere eight percent of the tickets, provided that SCI Ticketing meet Ticketmaster's selective rules. According to the rules, the band could either meet four “fan club requirements," or leave their own ticketing company and sign with competitor, Musictoday. In doing the latter, their allotment would increase to 25 percent and “fan club requirements" would be waived. One of those fan club requirements is that bands have “legitimate fan clubs," defined as fan clubs that charge at least $15 per person for membership.
Immediately following SCI's Aug. 11 press conference in New York,with band manager Mike Luba, Ticketmaster announced plans to countersue SCI, alleging the jam band had intentionally and illegally interfered with the ticketing behemoth's existing business contracts.
Terry Barnes, CEO of Ticketmaster, has allegedly compared his company to “heroin," stating that once Ticketmaster gets into the veins of promoters and venues, they simply cannot release themselves from its grip. In retaliation to SCI Ticketing's lawsuit, Ticketmaster released a statement that claimed SCI had “distorted the issue," that their exclusive business dealings with promoters are legal and are the result of their “turnkey ticketing solutions to help them best sell tickets." Ticketmaster also asserts “the allocation of fan club tickets in excess of historical reasonable levels flies in the face of our contractual guidelines with our clients."
For SCI band member Hollingsworth, the issue is simple. “All I want to do is sell tickets to our fans, because I'm feeling that the ticket prices are too high, especially in this economy, and that a lot of fans need to have a less expensive route to go."
Ticketmaster's attorneys have asked for an extension so that they may prepare their countersuit, and attorneys for SCI accepted the extension. Once Ticketmaster files its suit, the case will be reviewed by the federal court judge, who will then announce if the case has merit and whether or not it will be heard in court. According to Madison House president Carrie Lombardi, it is not likely that the judge will review the case until after the first of the year.
No matter what the result, fans can rest assured that SCI will continue to bring its message of community, artistic freedom, and innovative grassroots business practices out into the world. As Michael Kang (violinist/electric mandolin) stated at a show on July 4, “Maybe we could all commit for the next bit of time to really have freedom of thought, freedom of speech, freedom in songs, freedom in music, freedom in every way that we can experience it, and not be afraid to let that all out in any way. By living in this society, we can all do that. We can create an amazingly beautiful place."
For more information contact All About Jazz.
