ACCC v Ticketek Pty Ltd
[2011] FCA 1489 (22 December 2011)
Facts
A statement of agreed facts were provided for purposes of the proceeding only. Similarly, Ticketek admitted, for the relevant period only, that it had substantial market power and had taken advantage of that power for a prohibited purpose. The period was for approximately 6 months, during which time Ticketek 'took action in respect of deterring or preventing a competitor, Lasttix, from engaging in competitive conduct in the Ticketing Related Services Market'. The Court accepted that there had been a contravention of the Act.
Most ticketing related services to which Ticketek was a party granted Ticketek exclusive rights to print, prepare, sell and distribute tickets at the relevant venue [para 10]. Ticketek refused on several occasions to implement in its Ticketing System a discounted Price Type to be published exclusively by Lasttix
Briefly
By consent, the Court declared that Ticketek had contravened s 46(1)(c) by refusing to implement certain discounted price types to be published by Lasttix, thereby taking advantage of substantial market power for the 'substantial purpose of deterring or preventing Lasttix from engaging in competitive conduct in the Ticketing Related Services Market'.
The parties reached an agreement as to penalty for the contraventions which the Court accepted as appropriate.
Declarations and Orders
By consent the Court declared that Ticketek had contravened s 46(1)(c) of the TPA (now CCA) by:
- refusing to implement certain discounted price types to be published by Lasttix in relation to a Dr Phil tour, thereby taking advantage of substantial market power for the 'substantial purpose of deterring or preventing Lasttix from engaging in competitive conduct in the Ticketing Related Service Market'; [para 1]
- refusing to implement certain discounted price types to be published by Lasttix for 'World Dog Games' and a concert tour of Liza Minelli, thereby taking advantage of substantial market power for the 'substantial purpose of deterring or preventing Lasttix from engaging in competitive conduct in the Ticketing Related Services Market'; [para 2]
- refusing to implement certain discounted price types to be published by Lasttix for 'Les Ballets Trockadero De Monte Carlos' and a concert tour of Liza Minelli, thereby taking advantage of substantial market power for the 'substantial purpose of deterring or preventing Lasttix from engaging in competitive conduct in the Ticketing Related Services Market'; [para 3]
- temporarily removing from its Ticketing System certain discounted price types to be published by Lasttix for the 'Warriors of Brazil' production, thereby taking advantage of substantial market power for the 'substantial purpose of deterring or preventing Lasttix from engaging in competitive conduct in the Ticketing Related Services Market'; [para 4]
As a result of these contraventions the Court ordered pecuniary penalties of $725,000 for each of the first three contraventions and $325,000 for the fourth contravention as well as costs in the agreed sum of $100,000.
Reasons for judgment
On the issue of penalty
Justice Bennett set out the principles to which the Court should have regard in determining an appropriate level of penalty. These were set out by Justice French in TPC v CSR Ltd (1991) ATPR 41-076 at 52,152-52,153 (set out at para 23) and in subsequent cases (discussed at para's 24-25). His Honour noted that deterrence was the principal object of a penalty under s 76 of the Act (para 26). This requires consideration of both specific and general deterrence (para 27).
His Honour also discussed the relevance of agreed orders (at para's 30-36) before discussing issues relevant to penalties in this case (para's 37-56). In this respect, his Honour noted that, while 'the nature of Ticketek's conduct in contravention of s 46 of the Act is serious, the extent of this conduct, especially in the context of Ticketek's business activities, was limited', relating to only '4 of 2028 events for which Ticketek sold tickets during the Relevant Period'. [para 39] His Honour also noted that there has been no ongoing damage to Lasttix as a result of Ticketek's conduct [para 41] and that there had 'been no ongoing effect on the functioning of the market' [para 54]. The conduct was deliberate and engaged in by both lower level employees and senior management. Although total annual revenue was provided to the Court on a confidential basis, the Court noted that it was 'substantial' and that there was 'no suggestion that the proposed penalties are oppressive'. [para's 43-45]
The Court noted that Ticketek had a 'comprehensive compliance program', [my emphasis] devoting 'substantial resources to its continued implementation'. [para's 46-48]. However, the Court also noted that the contraventions suggested that the 'Compliance Policy was not properly implemented' [para 49].
The Court noted that Ticketek cooperated with the ACCC and,from an early stage put forward proposals for resolution of the investigation. Ticketek had not previously been found to have been in contravention of the Act for similar conduct or other anti-competitive conduct under the Act. [para 53]
The proposed penalty of $2.5million total included a reduction for cooperation, which the Court viewed as appropriate. The agreed figure was 'meaningful and substantial, serving the objects of general and specific deterrence and serving the public interest in encouraging the cooperation of parties the subject of Part IV investigation and litigation' [para 59]. The penalty was, therefore, appropriate.
Further reading
- ACCC Press Release: 'Ticketek Pty Ltd penalised $2.5 million for misusing its market power' (Release # NR 253/11), 22 December 2011
- Adrian Coorey, 'Ticketek penalised $2.5 million: A reminder that misusing market power is taken seriously' (2012) 27(7) Competition & Consumer Law News 231
- Elizabeth Stary, 'Misuse of market power and the Ticketek decision' (Mondaq, 14 July 2012)
- Michael Terceiro, 'ACCC v Ticketek - a non-event?' (2012) 64(3) Keeping Good Companies 158-161
Case links