Former Ticketmaster govt Stephen Mead was sentenced this week after pleading responsible to conspiracy to commit laptop intrusions expenses earlier this yr. Mead, a British nationwide, has been ordered to pay $67,970 as a forfeiture, and sentenced to at least one yr of supervised launch.
Mead’s expenses stemmed from a case that concerned Mead and a fellow Ticketmaster worker illegally accessing the programs of a rival ticketing firm – Crowdsurge. Mead and that co-conspirator – one other former Ticketmaster govt named Zeeshan Zaidi – have each admitted fault in a scheme that concerned gathering confidential data and sharing it with others within the Dwell Nation company household, data which was then used to poach Crowdsurge purchasers and drive the corporate out of enterprise.
Zaidi beforehand pled responsible to an analogous cost in 2019, however has not but been sentenced.
Ticketmaster itself entered a plea settlement with federal prosecutors in New York in 2020, paying a $10 million advantageous to keep away from prosecution. The Division of Justice informed BBC that it had accomplished the phrases of the deferred prosecution as of July 2024.
FURTHER READING | Ticketmaster Avoids Hacking Prosecution by Paying $10 Million Tremendous |
Whereas the Crowdsurge affair was in a roundabout way referenced within the DOJ antitrust lawsuit towards Dwell Nation and Ticketmaster filed earlier this yr, although the incident definitely displays the type of conduct that rivals have lengthy alleged that the company behemoth on the middle of the worldwide leisure trade engages in.
“Dwell Nation’s monopoly, and the anticompetitive conduct that protects and maintains its monopoly, strikes a chord exactly as a result of the trade at stake is one which has for generations impressed, entertained, and challenged Individuals,” reads the DOJ’s grievance in that case. “Conduct that subverts competitors right here not solely harms the construction of the reside music trade and the numerous those who work in that trade, but additionally damages the inspiration of artistic expression and artwork that lies on the coronary heart of our private, social and political lives.”
FURTHER READING | Dwell Nation and Ticketmaster Focused in Landmark Antitrust Lawsuit
What Mead and Zaidi Admitted to Whereas Ticketmaster Workers
Mead got here to Ticketmaster’s TicketWeb subsidiary in 2013, having beforehand served as Senior Vice President for International Operations and Basic Supervisor for North America at Crowdsurge – an organization that operated a music discovery platform and a separate ticketing operation aimed toward allocating tickets to artist’s fan golf equipment for presales.
Regardless of his signing of a strict non-disclosure settlement along with his former firm (and Dwell Nation’s inclusion of its personal settlement that he not violate that pact by sharing proprietary data as a part of his hiring course of), it was lower than a month into his tenure that Ticketmaster executives started asking him to share details about his former firm’s strengths, weaknesses, and areas the place they could possibly be exploited.
“Throughout [communications regarding information Mead had obtained while working at Crowdsurge], Govt-2 described how the purpose was to “choke off [Victim Company]” and “steal again one among [Victim Company]’s signature purchasers,” the indictment reads, partly. “MEAD responded by providing that they might “lower [Victim Company] off on the knees” if they might win again presale ticketing enterprise for a second main artist by providing the identical ticketing payment construction that the Sufferer Firm gave to the second artist.”
Quickly after, Mead and others inside Ticketmaster moved on to instantly accessing Crowdsurge programs, sharing proprietary perception into the corporate’s operations and payment buildings with an ever-increasing circle that included firm officers on the highest degree – together with then-Ticketmaster President Jared Smith and Michael Rapino, who was then and stays Dwell Nation Leisure’s CEO. Inside months, each Zaidi and Mead acquired promotions and pay raises.
The scheme started to crumble starting in 2014 when one of many Dwell Nation executives aware of the unlawful intrusion resigned and subsequently joined Crowdsurge, which merged with Songkick in 2015. Passwords identified to Mead and shared with Zaidi and Ticketmaster/Dwell Nation administration started to vary, and a civil grievance was filed alleging antitrust violations in 2015, later amended to incorporate allegations concerning the unlawful entry to the system as part of that unlawful conduct. By 2017, paperwork detailing the unlawful entry to the system by Mead and Zaidi had been made public as a part of that lawsuit, and each have been fired.
Dwell Nation later settled that lawsuit by buying the remaining Songkick/Crowdsurge property (the music discovery enterprise had beforehand been offered to Warner Music Group) for $100 million in 2018 and ending the lawsuit. It solely value an extra $10 million in charges to place all the authorized matter to mattress three years later – till this newest wrinkle.
“Ticketmaster workers repeatedly – and illegally – accessed a competitor’s computer systems with out authorization utilizing stolen passwords to unlawfully gather enterprise intelligence,” Appearing U.S. Legal professional Seth DuCharme stated in a press launch issued asserting the settlement of the prison expenses towards Ticketmaster in 2021.
“When workers stroll out of 1 firm and into one other, it’s unlawful for them to take proprietary data with them. Ticketmaster used stolen data to achieve a bonus over its competitors, after which promoted the staff who broke the regulation. This investigation is an ideal instance of why these legal guidelines exist – to guard shoppers from being cheated in what must be a good market place,” added FBI Assistant Director-in-Cost Sweeney.