Legal battle over US festival site could pitch SFX against AEG

March 2014

Live events sector


CMU Daily report that a a brewing legal squabble in the US could pitch acquisitive EDM firm SFX against live industry major AEG Live, and could impact on the 2014 edition of American music festival Electric Forest, which has already sold 21,000 tickets.

According to EDM website Dancing Astronaut, the owners of the venue in Michigan where Electric Forest is staged, Progressive Resorts, have told the event’s promoters Madison House Presents that they can no longer use the property, even though said promoter seemingly had a 20 year lease to host a festival there.

It’s reported that Progressive Resorts recently ran into financial problems and has restructured its finances as a result resulting in ownership of the site being transferred to two new companies, Antler Bar Amusements and Double JJ PropCo, which now claim that the change in ownership renders the two decade lease with Madison House Presents void, even though a $60,000 deposit was reportedly paid last October for this June’s festival.

The matter is now with the Michigan courts. But it gets more interesting because Dancing Astronaut also reports that, according to legal papers it has seen, SFX has taken an interest in the Electric Forest site through a deal with Progressive Resorts, presumably as the site is a good location for its growing festivals business.

But earlier this month Madison House Presents was acquired by AEG Live. And MHP’s partner in Electric Forest is Live Nation ally Insomniac Events. AEG filed a motion for intervention (allowing it to be directly involved in the case as a plaintiff), a temporary restraining order against Antler Bar Amusements and Double JJ PropCo, and a preliminary injunction in favour of the live giant and its business partners in Electric Forest. But at the end of February Judge Terrence R Thomas in the Oceana County Court denied the first of those requests.

Dancing Astronaut quotes Jennifer Forkish, VP Communications at Insomianc, as follows: “We have worked with Madison House over the last three years to build this festival into an experience that the fans would love. This sounds like a case of sour grapes – Madison House chose AEG as their partner over SFX, and now SFX is seeking to punish us, Madison House and most importantly the loyal fans who have already purchased their tickets. The 2014 show is still going on as planned and tickets are still on sale and we are extremely confident that the court will decide to allow the festival to move forward as planned”.

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