(Bloomberg) — Live Nation Entertainment Inc. Chief Executive Officer Michael Rapino told a New York jury that his multi-million-dollar compensation is tied in part to his “solving the DOJ problem” — a reference to the threat posed by government antitrust enforcers who want to break up the company.
About 90% of Rapino’s pay comes from a cash bonus and stock grant, the CEO acknowledged Thursday during testimony at an antitrust trial in federal court. Live Nation’s board bases those payouts on whether certain profit targets are met, as well as a “regulatory affairs” goal set by the board, he said. The US Department of Justice and dozens of states sued the company claiming it operates a monopoly in the live music business.
The DOJ reached a surprise settlement with Live Nation one week into a federal antitrust trial. But a group of state attorneys general, led by New York, are moving forward with their case, seeking to force the company to sell its ticketing arm, Ticketmaster.
Under questioning by an attorney for a group of states, Rapino denied the goal for his compensation was only related to the Justice Department’s case, saying Live Nation has regulatory issues around the world. The board was focused on “management of, not exactly the result” of, the antitrust lawsuit, Rapino said. It’s “not whether we win or lose” this case, he said.
Rapino, dressed in a form-fitting black suit, wasn’t entirely cooperative during his testimony, often saying he didn’t understand questions posed by the attorney for the states or trying to add context to yes-no answers. On breaks, Rapino guzzled Diet Coke and white chocolate bars.
US District Judge Arun Subramanian, who is overseeing the trial, ruled on Wednesday that the states couldn’t disclose the amount of Rapino’s compensation — which the states claim would be more than $27 million – because it could prejudice the jury. The states say he’s also one of Live Nation’s largest shareholders, but the judge ruled Thursday jurors can only be told the percentage of his ownership stake, not the dollar value.
Live Nation’s lawyers reiterated their claims Thursday that allowing the states to discuss anything about Rapino’s compensation is prejudicial to their defense.
Jeffrey Kessler, an attorney representing the states, argued that it was “unusual” for the CEO of a public company to be the “largest private owner.” That substantial stake means that “nobody can question him,” Kessler said. “A board member isn’t going to question him.”
Lauren Moskowitz, a lawyer for Live Nation, rejected the idea that Rapino was the largest shareholder saying he was only “the single human being who holds the largest number of shares.” According to data compiled by Bloomberg, the biggest holder is Liberty Live Holdings Inc., with the rest of the top 10 mostly institutional investors.
Lawn Chairs
Among the claims by the states is that Live Nation has used its monopoly power over ticketing and venues to impose excess fees and to generate more revenue from extra services.
For example, in 2024, Live Nation eliminated the ability of fans to bring their own lawn chairs to shows at its outdoor amphitheaters, which the states said helped boost the company’s revenue by renting its own chairs.
Rapino said the policy was developed because of “a safety issue” and to respond to fan complaints about differing sizes of chairs. An October 2024 presentation about Live Nation’s venues, however, said the company was making more on upsells “from policy to no longer allow outside lawn chairs,” with one slide estimating the company increased revenue by $7 million from eliminating lawn chairs at 12 venues. Live Nation’s adjusted operating income at large amphitheaters increased 32% between 2022 and 2024, with a 237.4% increase at Live Nation’s smaller or boutique amphitheaters.
Rapino pushed back on several of the numbers, saying the company “didn’t make anywhere near this.”
Earlier this week, the head of ticketing for Live Nation’s venues testified about chats from 2022 in which he denigrated fans as “so stupid” for paying high fees on VIP add-ons at concerts and boasted about “robbing them blind.” Rapino said he only became aware of the chats last week, which he called “disgusting.” But the CEO said the employee hasn’t been disciplined yet.
“We tend to give our employees a break and we don’t fire easily,” Rapino said.
The case is US v. Live Nation Entertainment, 24-cv-03973, US District Court, Southern District of New York (Manhattan).
–With assistance from Mikella Schuettler.
