Weekly Column: Antitrust Dealmaking an on-going Negotiation in Entertainment

In his capacity as a Columnist for California Sports Lawyer®, Founder and Managing Attorney Jeremy Evans has written a column about a flurry of antitrust matters in Hollywood and sports under investigation and in negotiation.      

You can read the full column below.


The United States federal government, specifically the Department of Justice (DOJ, Department), seeks to settle on-going litigation with one-hundred women who are alleged sexual assault victims of former gymnastics coach Larry Nassar for the American women’s teams for $100 million. The DOJ is settling the matter on behalf of the Federal Bureau of Investigation (FBI) for alleged inaction on behalf of the agency for failure to investigate properly the claims made by hundreds of women against the imprisoned former coach from previous charges. The DOJ is simultaneously investigating Live Nation Entertainment for anti-competitive activity in the ticketing business even though the current CEO does not believe the process includes the 2010 merger with competitor Ticketmaster that the Department previously approved.

While a breaking up of Live Nation Entertainment is premature at this point, it is not uncommon for the DOJ to revisit mergers after approval if the market or activity calls for such investigation and review. There are several major competitors in the ticketing space now with Vivid Seats, SeatGeek, StubHub, AEG Presents, and the Madison Square Garden Company as apps on phones have turned the industry on its proverbial head. It is believed that the investigation is focused on activity, not the previously approved merger, with the caveat that if antitrust behavior were to continue in light of the merger the deal could be called into question.

With Jessica Casano-Antonellis set to lead the new Disney-Warner Bros. Discovery-Fox sports streaming platform, competitors like FuboTV, DirecTV, Dish Network, and Newsmax are calling on Congress to investigate the matter publicly for alleged anti-competitive activity that may be the result of a proposed horizontal merger of three major businesses for sports content. Although FuboTV’s major argument is that vertical integration is inappropriate (e.g., the combination in one company of two or more stages of production normally operated by separate companies), three horizontally-competitive companies combining for a joint venture has precedence with Hulu as the most obvious example (e.g., News Corporation (Fox), NBC Universal (Comcast), Providence Equity Partners, and The Walt Disney Company combined to create Hulu in 2007). From a consumer perspective, many have complained of streaming fatigue in having to surf multiple platforms to stream live sports content, which is the last beacon of hope for live television.

FuboTV’s lawsuit against the Disney-Fox-Warner sports streamer is exasperated by the fact that Fubo’s subscriber numbers have fallen in first quarter of 2024 by 110,000. Meanwhile, the potential Paramount sale to David Ellison’s Skydance Media with Gerry Cardinale’s Redbird Capital partnering up is gaining steam. Apollo Global Management and Sony Pictures have also made a joint $26 billion dollar bid for Paramount, one of the original Hollywood golden era studios. However, Skydance’s pathway is likely the easiest going forward as it is not a major studio like Sony nor Apollo (through Legendary Entertainment) and would raise fewer concerned eyebrows at the DOJ. It is of note that when Skydance was founded in 2006 by David Ellison (son of Oracle founder Larry Ellison), the company entered a five-year partnership to co-produce and co-finance films with Paramount Pictures starting in 2009, and renewed the agreement twice extending to 2021. Skydance Media was later formed in 2010 and added sports and gaming to the film and entertainment studio. By comparison, Metro-Goldwyn-Mayer (MGM) sold to Amazon in 2021 for $8.45 billion dollars.

Paramount is also teamed up with MGM+ on an output finance deal through 2025. Dealmaking in Hollywood and sports are getting complicated as mergers become more common for the largest studios, networks, and streamers still adapting to the growth of streaming and price of licensing live sports rights. It is a dealmakers paradise, assuming one practices antitrust law or drafts and negotiate contracts.    


About Jeremy M. Evans:

Jeremy M. Evans is the Chief Entrepreneur Officer, Founder & Managing Attorney at California Sports Lawyer®, representing entertainment, media, and sports clients in contractual, intellectual property, and dealmaking matters. Evans is an award-winning attorney and industry leader based in Los Angeles and Newport Beach, California. He can be reached at Jeremy@CSLlegal.com. www.CSLlegal.com.  

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Jeremy M. Evans is the CEO, Founder & Managing Attorney of California Sports Lawyer® representing entertainment, media, and sports clients and is licensed to practice law in California.