CONTRACT / COMPETITION
Live events sector, online
A US bankruptcy judge has allowed Viagogo to proceed with a legal action against SFX Entertainment. modifying the “automatic stay” applied to SFX. Under Chapter 11 of the United States Bankruptcy Code, creditors are usually barred from collecting debts from the debtor. and allowing the secondary ticketing platform to “assert and prosecute any and all counterclaims” against SFX.
Having reviewed the request, Judge Mary F Walrath determined “sufficient cause exists to approve the motion”. Viagogo is seeking “in excess” of US$1.6 million from SFX, which went into administration on 1 February, for allegedly failing to adhere to the terms if a five-year, $75m sponsorship agreement signed by the two companies in 2014. The deal granted Viagogo exclusive ticket resale rights some 50 SFX-promoted events and SFX agreed to “deliver exclusive marketing and ticketing rights with respect to a number of designated ‘major’ SFX events.
In other SFX news, an Italian EDM record label is requesting a probe into how third parties might be artificially influencing SFX’s digital music charts. Art & Music Recording (AMR) has requested the Delaware judge overseeing SFX’s Chapter 11 bankruptcy case order the company to reveal what it knows about how the charts of its Beatport online music store are being manipulated or “juiced.” AMR is currently suing SFX in a Colorado court after six of their tracks were removed from Beatport. AMR’s lawyers have asserted that “Favorable placement on Beatport’s website and charts creates high visibility for the DJs and their labels, which in turn creates demand for the DJs, thereby generating significant income to the DJs and their label”.