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Dance music beat will go on despite arrests

For 13 years, Pasquale Rotella’s Insomniac Events and Reza Gerami’s Go Ventures collaborated on Together as One, a massive New Year’s Eve electronic dance music promotion at the Los Angeles Sports Arena. Now both men face criminal charges in a bribery and embezzlement scheme, and the biz they helped build from the ground up beginning in the 1990s must consider a future without them.

But, even in the face of indictments against Rotella and Gerami last week for alleged involvement in the scheme with former Los Angeles Coliseum events manager Todd DeStefano, many say the EDM concert circuit itself won’t miss a beat.

The two men, among the best-established and respected EDM promoters, have helped create a U.S. biz that now brings in tens of millions of dollars for star DJs and promoters. The boom shows no signs of slowing, with or without them.

According to concert tracking firm Pollstar, the Dutch DJ Tiesto racked up $19.4 million in North America last year, good enough for 46th place among the top 50 tours, not far behind acts like Brad Paisley, Foo Fighters and Janet Jackson. Another top spinner, Deadmau5, pulled in $10 million domestically.

The largest concert industry promoters, who would ignore such numbers at their own loss, have picked up their game.

“Other players are stepping into (the EDM) space,” says Gary Bongiovanni, head of the Pollstar, who notes that Live Nation Entertainment has established an EDM department and rival AEG has been mounting large dance shows.

Rotella, who founded L.A.-based Insomniac in 1993 as a high school student, was a kingpin in Southern California’s EDM market. He mounted the wildly successful Electric Daisy Carnival in Los Angeles from 1997-2010; his sold-out, six-stage Beyond Wonderland festival took place in San Bernardino on March 17. Insomniac is possibly the top national indie dance promoter, with recent events in markets like Nashville, Phoenix, Dallas, Memphis and Little Rock, Ark.

EDC suffered a wave of negative press in July 2010 after a 15-year-old attendee died of an overdose of the drug Ecstasy at the Coliseum. Officials agitated for the barring of EDM events at the county-owned facility, and Rodriguez’s parents filed a wrongful death suit against Insomniac. Last June, as the L.A. district attorney was investigating Rotella’s ties to DeStefano, Insomniac successfully relocated EDC to Las Vegas, where it drew an estimated 230,000 ravers.

But trouble followed his brand locally. Last July, hordes of fans were drawn by a tweet from DJ Kaskade to the premiere of Kevin Kerslake’s film “Electric Daisy Carnival Experience” at Hollywood’s Chinese Theater; a small riot ensued, incurring property damage and a handful of arrests.

Gerami’s 15-year-old, West Hills-based Go Ventures co-promoted the annual Together as One event with Insomniac until Rotella exited last year to launch his own New Year’s event, White Wonderland, at the Anaheim Convention Center. Go Ventures has promoted major dance events in Vegas, Miami Beach, Honolulu and Oahu.

Like Rotella, Gerami began to shift his L.A. events to other locales. Last year, he planned to move Monster Massive, his big Halloween EDM show, from the Sports Arena to Oak Canyon Ranch in Silverado, Calif., but the date was abruptly canceled without explanation.

According to L.A. County prosecutors, Rotella and Gerami paid DeStefano and his independently operated companies nearly $1.9 million between January 2009 and April 2010. Former Coliseum GM Patrick Lynch, who was also indicted, pleaded guilty to a count of conflict of interest on March 28.

Gerami was arrested March 22, while Rotella surrendered to authorities the following day on his return from Miami’s Winter Music Conference, the dance industry’s major annual confab, where his company had received the Intl. Dance Music Award as best event promoter. Both men are free after posting $1.8 million bail each.

In a court affidavit, L.A. County District Attorney’s Office senior investigator Deren Brady said the promoters “paid DeStefano not only to be allowed to continue to hold their events at the Coliseum, but to directly lobby for them to save millions of dollars from his inside ability to affect the contract for the events and the amount of rent paid to the Coliseum.”

Possibly in anticipation of last week’s indictments, Insomniac announced on March 13 that it had hired former Lionsgate Entertainment attorney and dance radio producer Simon Rust Lamb as its first general manager.

Both men have pleaded not guilty to the charges, and their attorneys maintain their innocence.

Rotella’s lawyer Gary Jay Kaufman declined an interview request by Variety, but issued a statement saying the charges against his client were “politically motivated and publicity driven.”

Gerami’s attorney Stefan Sacks says that the allegations of bribery and embezzlement are “completely absurd from a legal standpoint and a factual standpoint,” and that DeStefano was paid by Gerami for “valid services rendered.”

Even if the promoters are convicted and sentenced to jail time, their well-established firms would likely weather their absence.

In 1991, Gary Tovar, head of concert promotion firm Goldenvoice, was sentenced to federal prison time after pleading guilty to four counts of marijuana distribution. But his company flourished under his lieutenants Paul Tollett and the late Rick Van Santen; purchased in 2001 by AEG, Goldenvoice today produces the vast Coachella festival.

Pollstar’s Bongiovanni notes that the health of the marketplace no longer relies on pioneering promoters like Rotella and Gerami: “Five years ago, if a big player went down, it might have had some impact. Now everybody’s involved in it.”

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