Music retailer accused of a $3 million default
Ticketmaster Corp. filed a lawsuit Wednesday against online music retailer N2K Inc., accusing the Internet-based outfit of reneging on a $12 million marketing deal the two companies signed in April.
The deal called for Ticketmaster to make N2K’s Music Boulevard service the exclusive online retailer featured on Ticketmaster’s Web site, in addition to other promotional considerations.
N2K, which is in the midst of a merger with online retailer CDnow, was to pay the USA Networks-owned ticketing giant $12 million over a two-year period for the exclusive berth on Ticketmaster’s well-trafficked Web site for online ticket sales and concert info.
According to Ticketmaster’s complaint, filed in Los Angeles Superior Court, Gotham-based N2K gave notice to Ticketmaster on Monday that it “would not honor the agreement.” On Nov. 1, N2K defaulted on a $3 million payment, according to Ticketmaster.
Reps for N2K could not be reached for comment late Wednesday. Sources say the partnership between Ticketmaster and N2K was rocky from the start, although N2K and Music Boulevard links were still up and running on Ticketmaster’s Web site as of Wednesday evening.
Late last month, N2K Inc. and rival online retailer CDnow unveiled plans to merge in a deal valued at $101 million. N2K was co-founded in 1996 by former GRP Records chief Larry Rosen.