Lawsuit: Ticketmaster Sold Markups to Face Value

A New York area ticket broker is suing Ticketmaster Entertainment, claiming the company's chief executive reneged on an agreement to purchase the brokerage business.

The suit, which is constituted on breach-of-contract claims filed by broker Chuck Lombardo, also alleges that Ticketmaster organized an arrangement with the broker which allowed for tickets to concerts by the Eagles and Journey to be sold at prices higher than normal face value, the Wall Street Journal reports.

Ticketmaster last year hired Mr. Lombardo and his company, Elite Entertainment Inc., as consultants when Ticketmaster was attempting to become active the ticket resale market, the suit claims.

The principles of the ticket resale industry have recently become an area of controversy in the industry, as larger ticket providers are able to control prices.

Tension within the industry mounted recently as Ticketmaster announced plans to merge with concert promoter Live Nation - a maneuver that would put many ticket brokers out of business. The merger would reportedly generate higher ticket prices and allow smaller brokers little room for markups on which they typically generate revenue.

A Ticketmaster spokesman called the lawsuit "meritless" and claimed, "We will defend with vigor."