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Forbes • August 6, 2003
String Cheese Incident takes Ticketmaster to court

LOS ANGELES, Aug 6 (Reuters) - Colorado jam rock band String Cheese Incident has filed suit against Ticketmaster in federal court in Denver, charging the No. 1 concert ticket retailer had tried to cut off direct ticket sales to fans.

At issue are the blocks of concert tickets typically held back for sales to die-hard fans, a practice successfully pioneered by the Grateful Dead and now common for many acts including Pearl Jam, Fleetwood Mac, Aerosmith and others.

In the lawsuit filed on Wednesday, SCI Ticketing, a company formed by a partnership between the band and Madison House, a booking agency, charged Ticketmaster had used its "monopoly power" and "a web of long-term" contracts to cut off its supply of concert tickets.

A spokesman for Ticketmaster said the company does not comment on pending lawsuits as a matter of policy.

The lawsuit asks for damages and a court order barring Ticketmaster from the alleged anti-competitive practices.

Boulder, Colorado-based SCI Ticketing provides tickets for concerts by String Cheese Incident, King Crimson and others.

The company is one of several businesses spun off by String Cheese Incident, which sells its own concert CDs and DVDs, books travel for fans and supports charity causes through its affiliates.

SCI Ticketing said in the lawsuit that Ticketmaster had targeted the artist-run agency and instructed concert venues and promoters to stop supplying it with tickets.

"This concerted refusal to deal with SCI Ticketing, and Ticketmaster's monopolization of the relevant market and its abuse of that monopoly power, are causing damage to SCI Ticketing and may lead to its demise," the lawsuit said.

Los Angeles-based Ticketmaster is a unit of media mogul Barry Diller's InterActiveCorp. (nasdaq: IACI - news - people)

In the lawsuit, SCI Ticketing said that Ticketmaster had told concert promoters and venues with which it has long-term contracts in May 2002 that it would only allow direct-to-fan sales by SCI and others if the bands in question had "legitimate" fan clubs.

Those were defined in part as fan clubs that charge at least $15 per person for membership.

String Cheese Incident has never charged its fans for belonging to a fan club and saw no reason to impose such a charge just to obtain tickets, according to the suit.