Ticketmaster agrees to pay $ 10 million in fines to solve fraud and piracy charges

Ticketmaster has agreed to pay a $ 10 million fine To settle criminal charges that have repeatedly revolved against a competitor’s computer systems in an alleged scheme to collect “commercial information”. Ticketmaster, a subsidiary of Live Nation, mainly sells and distributes tickets for concerts and other events.

The fine is part of a Deferred Prosecution Agreement Filed in Brooklyn Federal Court Wednesday, which includes criminal information from five counts accusing Ticketmaster of conspiracy to commit computer hacking, computer intrusion for a commercial advantage, computer intrusion to promote fraud, and conspiracy to wire fraud and Internet fraud

Federal prosecutors said Wednesday that executives and employees at Ticketmaster repeatedly used stolen passwords to illegally access computers of an unnamed competitor in an attempt to “stifle” its business and lure major customers away.

A source familiar with the matter told FOX Business that the participating competitor is Songkick, a startup that specializes in pre-selling artists, with a percentage of tickets earmarked ahead of public ticket sales in an effort to curb speculation. In addition, Songkick showed off Artist Toolbox, a password-protected app that provides real-time data about tickets sold through the company.

to me Reuters, Live Nation acquired Songkick’s technology assets and patent portfolio in 2018 as part of a $ 110 million settlement to resolve an antitrust lawsuit. The Wall Street Journal It was reported that Songkick merged with a company called Crowdsurge in 2015 prior to acquiring Live Nation.

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The source identified one of the employees involved in the alleged scheme as Stephen Meade, a former Crowdsurge employee who started working with Live Nation in 2013.

During Mead’s tenure with Ticketmaster, he shared URLs with Zeeshan Zaidi, former head of Ticketmaster’s Artist Services division, and other employees in order to monitor draft web pages for tickets illegally designed by Crowdsurge. Mead explained to Ticketmaster executives that the “Store ID” numbers in the URLs could allow the company to know which artists planned to use the web pages to sell tickets.

In May 2014, Mead gave a demo to Ticketmaster executives during the Artist Services Summit using the login information he had kept from his time at Crowdsurge. Mead Al Zaidi and other Ticketmaster executives also provided confidential internal financial documentation from the company.

Around January 2015, Ticketmaster offered Mead a salary increase and elevated him to the position of Client Relationship Manager. Mead set out to help Ticketmaster maintain a spreadsheet listing every webpage that could exist, which would then be used in an effort to “persuade” artists not to use Songkick’s services. Ticketmaster employees continued to access the password-protected Songkick Toolboxes through December 2015.

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A Ticketmaster spokesperson told FOX Business that both Mead and Zaidi were terminated in 2017 after their behavior came to light.

“Their actions violated our company policies and were not in line with our values,” the spokesman added. We are pleased that this matter has now been resolved. “

Al-Zaidi pleads guilty to a case related to conspiracy to commit computer break-ins and fraud over wires based on his participation in the same plot. He has not yet been judged.

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In addition to paying the fine, Ticketmaster must also report to the United States Attorney’s Office annually during the three-year period of the agreement on new compliance measures, which includes maintaining clear policies to detect and prevent unauthorized computer intrusion.

If Ticketmaster violates the agreement, the company will face a lawsuit for computer break-in and fraud charges.