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Ticketmaster Will Pay $10 Million to Defer Prosecution on Fraud and Computer Intrusion Claims

Ticketmaster entered into a deferred prosecution agreement in Brooklyn Federal Court on Wednesday that avoids, for now, five charges related to  computer intrusion and fraud.

“Ticketmaster employees repeatedly – and illegally – accessed a competitor’s computers without authorization using stolen passwords to unlawfully collect business intelligence,” U.S. Attorney Seth DuCharme wrote in a statement.

“Further, Ticketmaster’s employees brazenly held a division-wide ‘summit’ at which the stolen passwords were used to access the victim company’s computers, as if that were an appropriate business tactic,” his statement continues, referring to what court paper’s describe as the company’s U.K.-based competitor. “Today’s resolution demonstrates that any company that obtains a competitor’s confidential information for commercial advantage, without authority or permission, should expect to be held accountable in federal court.”

In October 2019, Ticketmaster’s former employee Zeeshan Zaidi pleaded guilty to a computer hacking conspiracy count related to the scheme. Zaidi was originally hired by Ticketmaster’s corporate parent, Live Nation.

Another ex-Ticketmaster employer, ex-CrowdSource executive Stephen Mead, had been accused of hacking into his former employer’s database in order to provide real-time information about its plans, according to a lawsuit filed some three years ago. Both were fired from the company in 2017.

Court papers indicate the hacking took place between 2014 and 2015.

In an unsigned statement, Ticketmaster expressed the desire to put the matter behind the company.

“Ticketmaster terminated both Zaidi and Mead in 2017, after their conduct came to light,” the company said in a statement. “Their actions violated our corporate policies and were inconsistent with our values. We are pleased that this matter is now resolved.”

The California-based ticket sales giant will pay $10 million to avoid prosecution for those allegations for at least 3.5 years, until June 2024.

The five counts of the criminal information are conspiracy to commit computer intrusion, computer intrusion of a protected computer, computer intrusion in the furtherance of fraud, wire fraud conspiracy and wire fraud.

U.S. District Judge Margo Brodie accepted the waiver of indictment by the company’s general counsel on Wednesday.

Read Ticketmaster’s 28-page criminal information below:

[Image via Ticketmaster screenshot]

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Law&Crime's senior investigative reporter and editor Adam Klasfeld has spent more than a decade on the legal beat. Previously a reporter for Courthouse News, he has appeared as a guest on MSNBC, BBC, NPR, PBS, Sky News, and other networks.