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Ticketmaster agreed to pay a fine of $ 10 million after being accused of illegally accessing a competitor’s computer systems on several occasions between 2013 and 2015 in an attempt to “cut” [the company] on the knees. “
A subsidiary of Live Nation, the California-based ticket sales and distribution company, used the stolen information to gain an advantage over CrowdSurge – which merged with Songkick in 2015 and then acquired by Warner Music Group (WMG) in 2017 – hiring a former employee to break into its tools and gain insight into the company’s operations.
“Ticketmaster employees have repeatedly – and illegally – accessed a competitor’s computers without authorization using stolen passwords to illegally collect business information,” said Acting US Attorney Seth DuCharme.
In addition, Ticketmaster employees brazenly staged a division-wide ‘summit’ in which stolen passwords were used to gain access to victim company computers, as if it were a tactic. appropriate commercial.
The allegations were first reported in 2017 after CrowdSurge sued Live Nation for antitrust violations, accusing Ticketmaster of accessing confidential business plans, contracts, client lists and credentials. CrowdSurge tools.
According to court documents released on Dec. 30, after being hired by Live Nation in 2013, Stephen Mead, who was CrowdSurge’s managing director of US operations, shared with Zeeshan Zaidi, the former head of the Artist Services division. of Ticketmaster, and another Ticketmaster employee the passwords. to Artist Toolbox, an application that provides real-time data on tickets sold through the victim company.
Besides the password theft, Mead is also accused of providing “internal and confidential financial documents” kept to his former employer, as well as URLs to write ticketing webpages to find out which artists were planning to use. CrowdSurge to sell tickets and “dissuade” them. to do.
On October 18, 2019, Zaidi pleaded guilty in a related case of conspiracy to commit computer intrusions and wire fraud for his participation in the scheme, stating, “We are not supposed to tell anyone what we think. [the victim company’s] Activities. “
An anonymous Ticketmaster executive said in an internal email that the goal was to “choke” and “steal” its branded customers by reclaiming the presale ticketing business for a second major artist who was a CrowdSurge customer.
Mead and Zaidi are no longer employed by Ticketmaster.
Ticketmaster previously settled a lawsuit brought by Songkick in 2018 agreeing to pay the owners of the company $ 110 million and acquire its remaining unsold intellectual property to WMG for an undisclosed amount.
In addition to paying the $ 10 million penalties, Ticketmaster is expected to maintain a compliance and ethics program to detect and prevent such unauthorized acquisition of confidential information belonging to its rivals.
The company will also need to report annually to the United States Attorney’s Office over the next three years to ensure compliance.
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