This is Bloomberg Law with June Grosso from Bloomberg Radio.
Temperatures dipped into negative numbers Friday morning in Minneapolis, but crowds of demonstrators still turned out at the Federal Building to protest ICE operations in the state that led to the killing of two US citizens by federal immigration agents. Also on Friday, in a significant reversal, Deputy Attorney General Todd Blanche announced that the Justice Department has opened a civil rights investigation into the shooting of alex Pretty by two Border patrol agents.
We're looking at everything that would get shed light on what happened that day and in the days and weeks leading up to what happened. And that's like any investigation that the Department of Justice and the FBI does every day. It means we're looking at videos, talking to witnesses, trying to understand what happened. I mean, you're talking about an incredibly tragic morning.
Previously, ICE's Homeland Security Investigations Branch had been leading the investigation, and investigating law enforcement shootings is not something they're usually tasked with. Joining me is former Palm Beach County State Attorney Dave Ehrenberg.
Dave.
Let's look at the potential legal repercussions for the agents involved in these shootings. So the federal government could prosecute these agents, but under what circumstances.
Yes, the federal government has the power to prosecute those who act unreasonably in the circumstances if they were reckless in discharging their duties. Yes, but the federal government has said that they will not even investigate.
They were in a good shooting.
Now, when it comes to the Alex Pretty shooting, President Trump said that they will have an investigation. So it's unsure at this point whether they would move ahead for the Pretty shooting, which, by the way, I think has a stronger case of a prosecution there. I think that the agent's actions there multiple agents are more likely to be open to criminal liability than the shooting death of Renee Good.
Explain why the Pretty case is stronger.
The Renee Good shooting. You had an agent who could argue he was in reasonable fear of his life because the card did lurch towards him, even though it was clear that she was trying to avoid the agent. She was pulling her card to the right, the steering wheel to the right. But the card did lurch forward. You could hear him say WHOA. And because of that, I can see how a jury would say, yeah, he was
in reasonable fear of his life and that's why he shot. Now, the problem in that case is that he shot a second and third time when he was not in any danger. But oftentimes they will look at all the shots together, like if you can shoot once, they'll say you can continue shooting until the threat is neutralized. Prosecutors in that case will slow down the video to make each shot unique on its own, as opposed to one quick decision. Now, when it comes to Alex Preddy, you had situation where
he was not engaging in any criminal behavior. He was trying to help a woman who had been pushed down by an over aggressive border control agent. And then he got pepper spray for his troubles, and then he was thrown to the ground, and then he had seven different agents on top of him. They saw him with a phone the entire time, and the gun he had was concealed and he had a permit for it, and then
it was taken away. And after it was taken away, then someone yelled that gun and perhaps that gun went off. The one that was taken away and ten shots rang out in five seconds. He was shot ten times at five seconds, so I think that one is going to be tougher to defend.
They may say was a.
Mistake of fact where they thought that the gun went off, but I don't think it's reasonable, based on the videos for them to believe that he had a gun in his hand that was going off against them.
The top blow prosecutor in Minneapolis has opened homicide investigations into both shootings, but federal officers are generally immune from state prosecutions. Explain how the officers would raise that, how it would work.
What's going to happen is that the federal government is unlikely to prosecute the cases, and so the state of Minnesota will seek a criminal indictment. They can undergo a separate, independent investigation, which I think has already begun, and then they can seek a grand jury indictment, which I think they will. And when that happens, the federal agent, because he's a federal agent, will ask to remove the case of federal court. Now the case will still be a
state prosecution. You'll have state prosecutors, you'll have state law enforce but the case would be in federal court with a federal judge and a federal jury, which means that the jury pool will consist of residents of Minnesota from all over the state, so advantage to the defendant. But when it comes to im unity, the federal judge would make that call, and the question is did the agent or agents act in furtherance of the duties in a way that was necessary and proper to carry out their duties?
And if the answer is yes, then he gets immunity and it's game over. There will be no prosecution. If he says no, it'll be appealed, but then it'd be game on for a state prosecution in front of that federal jury.
The state's at a disadvantage here in its investigation because the federal government is refusing to share the evidence that it's collected.
This case is so unusual because when I was state attorney in Palm Beach County for twelve years, we worked with the Feds. The Feds would come in and sometimes they would say they want to take the case, and we would stand down. Normally, if the Feds say we're not giving you the evidence, it's because they want to preserve the integrity of the evidence so they can do their own prosecution, not to prevent a suspect from ever being prosecuted. So this is uncharted territory. So this is
what I think will happen. I think the state is going to file a lawsuit in federal court to get the federal government to turn over the evidence. I think the state is going to ask a federal judge to require the federal government to turn over the evidence they have. And I think I'll have a good claim here because the federal governments may clear that they're not going to
even investigate they were in a good shooting. And I think the federal judge, whoever it is in this case, will say, you can't conceal the evidence from state authorities for the purpose of protecting a suspect. Only if you really have a good faith basis for investigating yourself and prosking the case yourself, can you withhold evidence from the state. So I think that the federal judge will grant the
state's motion. But even if they don't, even if the state does not get the evidence from the Feds, the state prosecutors already started a web portal where they're seeking and obtaining videos and witness testimony and other evidence pertain to the case, and you could file charges. In this case,
you can get indictment based on the videos. Al you don't need necessarily to have the car because the Feds have the car when it comes to Rene Good and that would be helpful, but the state doesn't need it to seek charges because remember, when you get indictment, you just need problem cause once someone's indicted, then discovery begins and then you'll get more information and it doesn't do
the it would be defendants in this case. The agents doesn't do them any favors by withholding the evidence from the state because the evidence that the federal government has can also be exculpatory, meaning it could be to the defendant's benefit, especially because the FEDS are a favorable agency
for these ice and Border control agents. So that's why I would think as defendants, they would want the federal government to turn over all evidence they have to the state or else the state is going to do their own investigation, and I think it will result in an indictment.
And besides the immunity defense, what other defenses could the agents raise if they are prosecuted.
Well, immunity is not even raised a trial. Immunity comes before and now would shut it down. That prevents a trial to happen in the first place. So if it does go to trial, they would say that we acted reasonably under the circumstances that their lives were at risk, where they had an imminent threat against their lives, and the imminent threat in the first case would be the
car lurching towards the ice agent. In the second case, Alex Pretty, they would say mistake of fact, that they were in reasonable fear of their life, even though it was a mistake, but that mistake was reasonable because this guy had a gun and they didn't know it was taken away. It was all happening so quickly. And this
is their defense. I'm putting myself in their shoes. And they would say that when someone yelled out gun and then they heard a gun shot, they reacted the way they were taught to neutralize the threat.
Now they'll say that whether it's.
One shot or ten, you shoot to kill, you shoot to neutralize the threat. So that's going to be their defense. I think it's a tougher defense in the Pretty case and in the Renee Good case.
Does the defense have an advantage if the case is tried in federal court even under state law.
The defendants will certainly remove the case of federal court to get a jury pool from the entire state of Minnesota, because in federal court, there's one judicial district, and that's the entire state. Residents of Minnesota from all over the state, conservative, liberal, not just from blue Hennepin County. So instead of getting people who are angry about what's happening in Hennepin County, you'll get a cross section of the entire state, including Republicans.
And that's why, even if this does go to trial and immunity is rejected, it is still an uphill battle for prosecutors because you've got to prove beyond a reasonable doubt in front of a unanimous jury that these agents committed crimes. And you have a natural inclination of people to believe law enforcement, to trust law enforcement, to give
them the benefit of the doubt. And you have politics at play where people can see the same video and it's like a warshock test where they interpret it differently, And so how are you going to get twelve jurors to all agree one way? That's the challenge that prosecutors face, Dave.
There are so many video already of the pretty shooting from different angles. Does that make it easier for the prosecutors or perhaps not just more confusing.
I think the more videos the better, the more transparency, the more angles the better, because if you don't have the full picture, you're gonna have reasonable doubt.
So there you go.
If you're the government, you want to have enough proof that you can prove the unreasonable doubt that these officers were not in imminent danger and it was not reasonable for them to think.
That their lives were at risk.
But that's what good lawyering is about, is about deciding how to present the videos. For example, in the Rodney King case, you remember that the prosecution showed the video and I was appalling a horrific video, but the defense slowed it down, frame by frame and they showed see the officer reacted here because Rodney King was resisting, and they showed that in slow motion and he was acquitted
at the state level. Well, in this case, they're going to slow the video down to try to convict the officers. It's like the opposite, it's like the reverse Rodney King where the government is going to say slow it down, and you see that there are a good shooting shots two and three were inappropriate, unreasonable, and also they're going to slow it down.
In the Alex Peretty cases.
See look the gun was removed, it was walked away, and then the shots began, even though it happened really quickly.
A long way to go and many many motions ahead before any trial. Thanks so much, Dave. That's Dave Ehrenberg, former Palm Beach County State Attorney. Coming up next on the Bloomberg Laws Show. A landmark trial on social media addiction starts in Los Angeles. I'm June Grosso. When you're listening to Bloomberg.
Mister Zuckerberg, you and the companies before us, I know you don't mean it to be so, but you have blood on your hands. You have a product, you have a product that's killing people.
That was book and Senator Lindsey Graham during a Senate Judiciary Committee hearing two years ago, a rare instance where Democrats and Republicans were united in their criticism of social media CEOs like Mark Zuckerberg for not protecting kids online. The Meta ceo pushed back on some studies that suggested social media use is a detriment to the mental health of teenagers.
Mental health is a complex issue, and the existing body of scientific work has not shown a cause a link between using social media and young people having worse mental health outcomes.
Zuckerberg may make that same claim when he testifies to a jury in a landmark trial over claims that the top social media companies have deliberately gotten teenagers addicted through their design choices. On trial are Meta, the owner of Facebook and Instagram, and Google, the owner of YouTube. They dispute the claims that their platforms deliberately harmed children and cite the safeguards they've added over the years. Snap settled the case last week and TikTok settled on the eve
of trial. Joining me is an expert in cybersecurity and data privacy, Colin Walkee, a partner at Holestel. Colin, the plaintiff in this case is a California woman who is now twenty years old. Tell us about our allegations in this lawsuit.
This is really the first one that's going to trial. There are dozens, if not hundreds, of similar lawsuits out there, and the basic allegation in this case, in all of the cases, is that the algorithms that have been put out there by the social media companies, as well as all the bells and whistles they put on their social media platforms, have made their products addictive. So this is very much akin to the tobacco litigation in the nineteen nineties.
One is it addictive? And then two are there harms that flow from it? The jury is ultimately going to decide that in this.
Case, and the plaintiff's theory is a novel one that compares social media sites to defective products.
Yes, and in fact, some of the claims even relate back to like a nuisance type claim. But long story short is that the way these algorithms operate is they get you addicted through casino style techniques. So casinos know, for example, that every time that you put a quarter in you shouldn't get a reward because then you won't come back. So it's the timing with which you see and the content that you see it in and then what are the consequences that flow from that, So for example,
mental health harms as a result of that. You could think about children in school and the distractions that's some of the allegations that have come out in these cases is, you know, Instagram started losing teenagers and they were sitting there going how do we get back more teenagers? Well, let's figure out a way to get our platforms in schools, right, And so the harms that flow from this are unique to each individual, but you can see how they compound.
So they're going to try to show that the social media companies deliberately made these addictive design choices.
Correct that that they have done this. And I think that there's plenty of testimony out there that probably supports the goal of making individuals remain on platforms as long as possible, keeping their attention there so that they can increase the number of viewers and thereby increase the number of advertisements. So I don't think there's really anything new about that. But the tech companies are coming in and saying, whoa, whoa.
We already know based off of the Spring Courts ruling on section two thirty that the algorithms themselves are protected speech. And so the unique claim in this particular case is, yes, that may be speech, but the other bells and whistles that you're putting onto this and what you're doing within it is not speech, and rather it's conduct that it's getting us addicted to your platform.
The tech companies are also arguing that they're not legally responsible for the effect of the content made by users, So explain what they're out is here what they're trying to get.
To, right, So, in short, the fact that you're being shown what you want to see is your own choice. You could choose to see and view different things based off of the likes, and you're viewing habits and all of that. So they're essentially saying, all we're doing is giving you what you want. We're not doing anything to make it more enticing than it already is. And you know, part of the argument too is how much is your
cell phone itself addictive versus the platforms themselves. Right, So every time you get an iPhone update, for example, it becomes a little bit brighter. Why the brighter the screen, the more dopamine in the brain. The more dopamine the brain, the more you want to look on your screen. That's why it's hard for you to figure out without going to Google how to set your screen to black and white.
They don't want you to know that, so part of their argument here, too, is is how do you distinguish which component of this is addictive.
The plaintiff in the case, a twenty year old woman identified only by the initials KGM, claims that more than a decade of social media use left her addicted and depressed. The defendants are challenging that narrative, saying she experienced difficult family relationships, abuse in bullying at school and that played
a role in her mental health struggles. I mean, how difficult is causation going to be here for her to prove that, you know, it was her addiction to the platform rather than all the other things happening in her life.
Well, it's one of the sayings that we have in personal injury cases, which is you find your planiffs as they are. And so in this particular case, yes, they have some pretty good arguments that the mental health harms are a result of her history. But the question then becomes were they exacerbated by virtue of the negligent conduct? And if that's the case, then the approximate cause is in fact the social media platform and not the historical
trauma that she experienced. It is going to be an issue for the jury to determine about the mental health harms, what was the ultimate cause, what are those damages? And on top of that, are punitive damage is something that.
Could be afforded.
There is a debate within the mental health field about the connection between social media and increasing teenage rates of depression, anxiety, suicide ideation. Is that debate going to enter the courtroom where we're going to see experts on both sides of the issue.
Absolutely, you will, just like you saw with its Abacko litigation. I mean, that's the reality is you're going to find experts on both sides of this issue. But at the end of the day, the reason why the jury trial system is so good here in the United States is because our jurors really are good at detecting bs, and so they'll be able to figure out pretty quickly not just from what the testimony is, but from their own
personal experiences. I don't think that anyone can ultimately hear the testimony of these executives and former executives and decide that they didn't at least try to make it more addictive. Whether they accomplish that goal maybe a different story, but it's pretty clear they at least tried explain.
What a Bellweather trial is and is this a Bellweather trial.
This is absolutely a Bellweather trial. It's very similar. Recently, for example, you saw a Tesla I actually went to trial and won on one of the cases where they're automatic driving vehicle injured somebody, and so that is going to embolden Tesla into the future. So if you imagine a scenario in which the social media companies do win this case, they're going to feel emboldened to continue to
pursue it. On the flip side of that coin, if the plaintiffs win this case, then at the end of the day, you're going to start seeing a lot more settlements.
And speaking of settlements, the fact that Snap and TikTok settled TikTok on the eve of trial, both for undisclosed sums, what does that tell you about how the social media companies are evaluating the risk of going to trial.
I think what most people don't realize is that lawyer's jobs are to manage risk. We are risk managers, that is it. And so for the plaintiffs in this case, if they settled, the reason why is because they know that this is going to be taken all the way to the Supreme Court, and that's going to take another five years, whereas they can get some money today and
avoid that risk. Right, So there's an incentive for the plaintiffs to settle from that regard, and there's an incentive for the defendant to settle because they don't want this information to get out there in the real world about how much you know your privacy is being pilfered for profit. They don't want their dirty laundry aired. And so this is why settlements happen, is because both sides are incentivized to not continue on with the case whether they're right or wrong.
Zuckerberg is expected to be among the first witnesses called. He has testified before Congress, But explain how different it is to be testifying in a courtroom before a jury where you're subject to cross examination.
Well, it's wildly different, because if you remember back when Mark Zuckerberg came and testified in front of Congress, one of the congressmen actually thought the reference to a cookie was an edible item and not a pixel contained on
your computer screen. Okay, So the difference is that these attorneys in the courtroom know the technology, they know the facts, and they're going to be able to effectively cross exams and someone about what a cookie is and how they're tracking your data from one website to another, and then it begs the question, why are you tracking my information from my insurance carrier? Oh, well so we can show you more ads? Okay, why are you showing more ads? Well,
so we can get you addicted. So that's how the cross examination is going to work that you would have never seen in Congress.
I think Zuckerberg as a tendency to sometimes appear a little bit wooden when he talks. How much depends on how the jurors view him.
Well, it goes back to the old saying that you know a jury, if they like you, they like your cause. And so that's a hurdle that the tech companies are going to have to overcome at the start of this trial, because they've had enough black eyes already that the jury's not going to like them out the.
Gate and the plaintif here will have to take the stand.
Yes, the Planoff will have to take the stand. And I have no doubt that her mental health history will come up and the trauma that she has suffered, and all of that is fodder for cross examination. As painful as it may be for someone to go through that process, it has to occur in order for the jury to have a full under standing an appreciation of whether or not the trauma in this case was related to addiction from social media or prior experiences.
Jury selections started this week tell us the kind of jurors that the plaintiff's lawyer will be looking for and the kind of jurors that the defendant's lawyer will be looking for.
So, if I'm the planiff's lawyer, I am looking for individuals who are going to be used to using social media and find it problematic for themselves or their family members. Right, So we all have the uncle or the dad who spends all day long on Twitter, and you're rolling your eyes like sitting there, going do you not have anything else to do? You want somebody who is frustrated about
the system on there. From the plantiff's perspective and from the defendants perspective, you're looking for someone who is willing to say, you know what, we live in a capitalistic society in which individuals have freedom of choice, and these people are choosing to download this app and spend time on it. That is a choice that they are making, and so you're gonna want someone who is very libertarian in their perspectives on life.
Would you say it's more or less likely that the trial is actually going to start after jury selection.
So, first of all, ninety three percent of all cases settle before trial, so only some percent of cases actually go to trial. And in that regard, many cases settle midway through trial. You get pick your jury, and you sit there and you go, I don't really like this, let's go talk. So there is still a chance for to settle. Although I was recently involved in a case where the other side made it to clear this is
a test case for them. And so if that's the position of either the social media company or the plaintiffs, and I've got to imagine the plaintiffs have invested enough money at this stage they don't have a choice but to keep going. Then this is their bell Weather case and they're going to figure out the answer a.
Bell Weather for the more than sixteen hundred other similar cases against the tech companies. Thanks so much, Colin. That's Colin Walkee of hall Estel coming up next on The Bloomberg Law Show. Kid Rock testifies to Congress about ticket scale helpers, price gouging, and the skyrocketing costs of concert tickets. But the Justice Department and the FTC have already sued
Ticketmaster and Live Nation. So what's the solution? Remember you can always get the latest legal news by listening to our Bloomberg Law podcast wherever you get your favorite podcasts. I'm June Grosso and you're listening to Bloomberg.
Secondary ticketing is driving up prices for the fans with absolutely no benefit to the artist.
Not many fans or artists would dispute that testimony from Kid Rock about the skyrocketing costs of concert tickets, whether
it's BTS, Beyonce or Bruno Mars. If you've tried to buy tickets to the concerts of any major artists, you've seen not only the astronomical prices, but probably also experience the nightmare of trying to buy tickets online, waiting patiently in a queue, and then watching the tickets vanish in seconds before your eyes, sometimes even after they're in your cart for purchase, and then seeing those tickets at three
or four times the price in the secondary markets. Kid Rock, whose real name is Robert James Ritchie, didn't mince words when describing the live concert and entertainment industry to the Senate Commerce Subcommittee.
It's no secret none that this industry is full of greedy, snakes and scoundrels. Too many suits lining their pockets off talent they never had, and fans they mislead. The truth is much of this could have been, or still could be solved through technology, especially proof of humanity tools. It hasn't happened yet because there's just too much money in the secondary ticket market.
But the hearing seemed to raise as many questions as it answered. Joining me is an entertainment lawyer in the music industry. Ron Beanstock, a partner at Fox Rothschild. Ron kid Rock, started out his testimony by reminding the committee that Pearl Jam sat before Congress thirty years ago testifying against Ticketmaster. I mean, in thirty years, are we in the same spot.
Yes, and no, we are probably not exactly the same spot, because there's appearances, there's litigation, there's investigation, But the truth is overall, what has not changed and has probably only sort of manifestly become more difficult, is that we're talking about Live Nation and ticket Master. They're a monopoly. Ticketmasters sells what five hundred million tickets in thirty countries, and
they have eighty percent of the US market. That's where your problem lies, is right, you have no competition on this. I think where this problem starts is that there's a misconception about ticket pricing and bands and artists and how this all works. So my clients, yes, they'll set the
ticket price, but here's how it works. Let's say you've set a ticket price, and you want to be reasonable and have fans have accessibility to the show, and so your ticket price, let's say, is one hundred dollars, and we also have to talk about the incredible increase in production costs to get an artist on the road. But let's say it's one hundred dollars ticket it goes through sale through ticket Master. Now it's one hundred and seventy
with all the tack on items. As many manager as I spoke to, I called a few people to get some background. Man, there are a lot of epithets being tossed around by management. But effectively, when you want to offer the artist price at one hundred out to the marketplace your fan group, and it comes one hundred and seventy when they order with all the tack on stuff,
your ticket price is up by forty percent. I think the problem there is that every artist wants to make it accessible to the fan, and they get blamed for the extra costs that are tacked on by ticket Master, and it's not the artist that's doing that. The artist
wants their fans to be there. There's a secondary market problem where tickets that go on sale and the fans are able to gobble up the good tickets, then the back of the hall tickets come up, and you know what I mean, all the way the back tickets come up and people will say, I can still get into the show, and those tickets are still at one hundred and seventy total or more when they really shouldn't be. They're not the primary seats. So the secondary issue comes up.
There's just so many factors in offering your fans a fair price for a ticket, and technically you're supposed to have under the face value exchange. Now you're supposed to know exactly what you're paying for. But again I don't think that's worked out because the monopolistic.
Situation you talk about, you know, the markup the artists won one hundred dollars a ticket and then it goes to one hundred and seventy. Who's getting those seventy dollars?
Those markups are going to ticket Master and other similar companies that work with them, Right, you're going to get ticket Master and Live Nation are going to because they're the same company. They're going to be taking those additional cost home with them. That's their profit. While the band has more of a difficulty here because they have I mean band, it's irrespective of genre.
I'll just refer to as artists and bands.
They have the difficulty in trying to get a ticket price that allows a fan to get a good seat to see them at the same time that they're balancing all the additional costs it takes to travel to get there to present that show. And that conundrum is faced every day by artists. I want to add one little thing. I think there's something that everybody's overlooking that increases the costs, and that is most artists make up the differential even if they ask for a lower ticket price, they make
up the differential with merchandise sales. Well, that's problematic because merchandise sales are fixed. You're paying somebody to go sell. You may have a merchandise deal and there'll be a booth, window, table, whatever it is, and you're selling your hats, your T shirts,
your hoodies, whatever it may be. And the fan walks up and doesn't understand that when they buy that sweatshirt, the venue that the artist is playing in is taking twenty five to thirty five percent of that for doing literally nothing.
And those prices have gone up and up. I mean you look at a T shirt sometimes it's like forty to fifty bucks. It's crazy, the prices.
Because the hall, the venue what we used to refer to as a hall fee, that name is morphed a little bit to make it more palatable, but it's still money for nothing. To quote Mark Knopflin, it is twenty five to thirty five percent additional tack on to the merch costs. And you buying that T shirt see that and say the band merch is so expensive, But the band has to raise the price to make up for
this hall fee. And that would have taken care of any deficit more minor deficit of playing the show for a lower ticket price just to have the fans come. They make it back on merch but if you're paying twenty five to thirty five percent, I've seen forty percent, then you ratchet up your merch fees, which is nothing
to do a ticket master. But you can see how it starts with ticket Master, how it starts with the expensive ticket prices and you want the fans to come out and see you, but now you have this additional cost. And I think this is kind of like one of these little I don't want to say dirty little secrets, but just one of these unknown issues that people don't
talk about. And you know, I spoke to several managers, particularly one client's manager I've worked with for thirty five years, and I valued his input, and he had said, you know, what I'd really love to have would be the power to organize all of the acts together, almost in a union fashion, to say to all the venues, we won't sell merch here just because you're going to take that cut.
Now, that's a.
Bit of you know, spitefulness to the venues, and we lose the money as the artist. But you can understand the sentiment there, and that is I don't want to pay you for doing nothing. I'd rather not bring my merch into the room rather just sell it online or another methodology.
The Federal Trade Commission and a bypart is in group of state attorneys general did sue Ticketmaster and its parent company, Live Nation in September, saying they're I'm for seeing consumers to pay more to see live events through a variety of illegal tactics. But this month the company's asked a federal judge to throw out the case. What's their argument?
So the defense here is that you have the wrong parties. We are not responsible for the resellers. They're blaming the bot buyers and the resellers, even though we've had the Bock Buyers Act in twenty sixteen. They're saying, don't look at us. You know, you're blaming us as being monopolistic here, But it's really the bot buyers and resellers who are causing the problem, not us.
You know.
I want to make one sort of comment here. It's a little performative for Kid Rock because he has a close relationship with this administration, and I want to take slight umbrage to one thing he said when he said, you know, I'm a maverick. I don't have to answer to anybody. You know, I don't have to answer with to a label or anything like this. Let's draw back and have an overview about that. Labels have nothing to do with this. That's not just red herring, that's just
not applicable. Labels have nothing to do with ticket prices. Nobody at the labels is demanding that the artists set ticket prices. They just want them to tour because they want to sell product. They want to sell some vinyl and hopefully get some downloads out of this. Of course why wouldn't they, But it really is Ticketmaster that is the problem in terms of monopolistic behavior, nothing to do with labels. And I want to throw one more thing, and while I'm on my soapbox, is that very few
artists are really with major labels. Now, so again this you know, I'm a rock, I'm an island.
Look at me.
I don't answer to anybody, you know. I know that fits his self proclaimed position in the industry. But everybody's in the same position. Very few people are working with major labels, which again nothing to do with ticket prices.
So almost everybody is in the same world, putting out their own material through their own labels and going back to their fans and trying to just you know, twice a year, get on the road and stay relevant to their fans and bring new materials sometimes new material to them.
But no, he's not the only one speaking up.
He gets an automatic vibe because he has that relationship ship with this president administration.
If Ticketmaster really is the problem. The Justice Department filed a sweeping antitrust lawsuit against ticket Master and Live Nation in May of twenty twenty four. It accuses them of running an illegal monopoly over live events and ask the court to break them up. Trial is schedule for March. So if the Justice Department wins, and if the judge agrees to a breakup, will that solve some of the problems We've been discussing the AT.
And T breakup. How did that work? Right?
Oh, don't go back in time.
I think the AT and.
T anti monopolistic filings I think are analogous to this, because you know, everybody eventually got some choice, and you know, the competition in the marketplace for tickets and ticket sales is important, and if one company controls that, then they get to control the narrative on cost. And you know, don't look at us, it's someone else's fault. Right, they blame everybody else. But what I don't don't want to have happened here, And I think it's really important to emphasize it's not the artist.
I hear it all the time.
I don't want the artists taking the wrap here for and that's upon I suppose, but taking the wrap for Oh, these guys are being greedy. They're not selling records anymore, so they're raising their ticket prices. That is not entirely the case. The ticket prices, which I demonstrated when we first started speaking, from one hundred to one hundred and seventy. The band's only getting a portion of the one hundred.
They're not getting that seventy dollars overage. That's all going to the ticket sellers and to some extent the venues. And when we pile on now with the merch fees at the hall, you can see the artist is it's very difficult for them to get their ability to stay
out on the road and pay. You know, sometimes thirty people are going to go out with a particular artists or more right, we've got all kinds of texts and crew and drivers, and you know, it's difficult to keep this out there and everybody that I work with, it's a bit of a struggle. Want to play for their fans. That's the lifeblood of the industry. But if we have constant ticket prices and constant raising of costs to get there, people are going.
To stay home.
What about a law that limits the amount of overcharges that you could put on a ticket.
We have that with credit cards, and I think we've attempted that with ticket prices. I don't think it's been successful, and I think that it's possible. And this isn't this administration. This has been going on, you know since twenty fifteen, twenty sixteen, We've got a solid ten years of people
trying to effectuate change here. It's going to take I think, a true meaning of the minds between the ticket sellers, ticket companies you know, ticket Master or Live Nation to come to the table to say Remember, they're also going to say, well, we have we have a right to make a profit doing what we're doing. The problem is it's like overage on credit card fees. When's the limit right? How much is enough? Because eventually it'll strangle the live
entertainment business and pay per view never worked out. We all know that so people still want to see bands live and we have to do everything in the industry. Everybody has to do everything they can to foster that on a regular basis, and I think legislation is going to have to be there, and maybe it's going to have to be a breakup or culling down of the actual cost factors. Maybe there is a cap that has to come into being.
Of the things that Kid Rock suggested some of his solutions, allowing artists to control who sells their tickets and how, recapping resale ticket prices, enforcing the Bots Act to stop brokers and bad actors. Do you see any of them as being a real solution.
Well, no one's really enforced that Bots Act from twenty sixteen. You've got ten years now, so he's not wrong. But someone has to decide what their priorities are, and if there's a prioritization to this, it may occur. But this particular Department of Justice is that other priorities.
So you know this.
I think it's a lot of lip service to say we support that, but I don't see the actions. The actions were started long before this because they work their way through the courts. If this administration truly wants to see this take place. Then they can do that by by having a bit of a summit, if you will, and bringing people to the table to say we need to do this, we need to cap this.
It's preferable for.
Business not to force this right, not to force the anti monopolistic actions. But we're going to have to get some cooperation. And by the way, I want to add one thing. I don't know if the artist picking who sells their tickets, because then we make it, get that same behavior by the next group of people. You know, I don't want to be pessimistic, but if the next group says I'll handle all this for you people, same thing occurs again. So there has to be some independence here,
non reliance on the same group of people. We don't want to have the same thing. You know, I think he quoted, you know, the who he did and his presentation. Meet the new boss, same as the old boss. Meet the new ticket seller, same as the old ticket seller. And we really want to have change here, and that change requires fortitude by either this administration or the DOJ to dismantle an incredibly powerful monopoly.
You know, eighty percent, that's that's a monopoly.
I do think a lot depends on the antitrust trial coming up in March, and we'll see what happens with the FTC suit as well. Thanks for joining me, Ron. That's Ron Beanstock, a partner at Fox Rothschild. And that's it for this edition of The Bloomberg Law Show. Remember you can always get the latest legal news on our Bloomberg Law Podcast. You can find them on Apple Podcasts, Spotify, and at www dot Bloomberg dot com slash podcast Slash Law, and remember to tune into The Bloomberg Law Show every
weeknight at ten pm Wall Street Time. I'm June Grosso and you're listening to Bloomberg