close
close

first Drop

Com TW NOw News 2024

Former Ticketmaster boss convicted of hacking rival company CrowdSurge
news

Former Ticketmaster boss convicted of hacking rival company CrowdSurge

Getty Images The Ticketmaster logo is displayed on a smartphone with the Ticketmaster homepage in the background, in this photo illustration in Brussels, Belgium, on June 2, 2024.Getty Images

A former Ticketmaster executive who illegally accessed a rival company’s computer servers to steal information has been convicted.

British citizen Stephen Mead stole sensitive data from CrowdSurge, a smaller company he previously worked for, between 2013 and 2015. His actions directly contributed to the company’s demise, the New York Department of Justice said.

Mead pleaded guilty to conspiracy to commit computer intrusion against CrowdSurge in June. He has now been ordered to pay $67,970 in forfeiture (around £52,000) and has been sentenced to a year of probation.

Court documents filed in the US state show that Ticketmaster executives asked Mead to share “competitive information” about the company.

Ticketmaster, which describes itself as the world’s largest entertainment ticketing platform, did not respond to the BBC’s request for comment.

Another former Ticketmaster executive, Zeeshan Zaidi, also pleaded guilty to fraud in 2019, namely conspiracy to commit computer hacking and wire fraud. He has yet to be sentenced.

Mead was ordered to repay an amount he received when he left CrowdSurge, as well as the salary increase he subsequently received from Ticketmaster.

A Foreign Office spokesperson told the BBC: “We are providing consular assistance to a British man in the US and are in contact with local authorities.”

CrowdSurge – a website that allowed artists to sell advance tickets to fans – was a rival ticketing company to Ticketmaster, headquartered in London with a US office in New York. According to US court documents, the company had an estimated value of more than $100 million.

Since 2010, Mead has served as Senior Vice President of Global Operations and General Manager of North America at CrowdSurge.

The BBC has seen court documents showing that when Mead left CrowdSurge in July 2012, he signed a “separation agreement” which stipulated that he would not keep or share confidential information – including customer lists and marketing strategies – with third parties.

According to court records, the agreement also stipulated that Mead would not be allowed to work for another ticketing company for a year. As part of the settlement, CrowdSurge paid Mead approximately $52,970.

But he repeatedly violated the separation agreement, court documents show.

In the summer of 2013, Mead joined Live Nation, the parent company of Ticketmaster, in a division called TicketWeb.

According to the Public Prosecution Service, CrowdSurge’s computer server logs reveal at least 25 instances in which its company data was accessed by computers with IP addresses registered to Ticketmaster and affiliated companies in New York, San Francisco and Los Angeles between August 2013 and December 2015.

‘Bringing CrowdSurge to its knees’

According to prosecutors, Mead shared CrowdSurge spreadsheets containing financial information and passwords without permission and, at the request of Ticketmaster executives, accessed competitive information about the company’s customers and technology.

He also provided other Ticketmaster employees with information that allowed them to access password-protected CrowdSurge information, advised them to “screengrab the entire system” and discussed “bringing CrowdSurge to its knees,” court documents show.

They also allege that on one occasion, at Zaidi’s request, Mead gave a presentation to at least 14 executives and employees of Live Nation and Ticketmaster, using a CrowdSurge username and password to log into their websites without permission. During the presentation — which was projected onto a large screen in a conference room — Mead demonstrated one of CrowdSurge’s custom-built products, called the Artists’ Toolbox — a web-based data analytics package for music artists.

During his tenure, Mead also shared real-time data on ticket sales and the identities of artists CrowdSurge worked with.

The DoJ said the information was used by Ticketmaster to plan competitive responses to win pre-sale ticketing business and compare products and offers. It added that Mead’s actions resulted in monetary losses for CrowdSurge that were “particularly significant in a highly competitive business environment.”

It says Mead was later promoted to director of client services in Ticketmaster’s artist services division in early 2015, reporting directly to Zaidi. He also received a pay raise.

Court documents show Mead did not engage in any criminal activity to personally benefit from the scheme, other than the benefit he received by enhancing his position and standing within Ticketmaster.

CrowdSurge discovered Mead’s hacking behavior after a former Ticketmaster executive joined the company in 2015 and warned the company to change the way its systems were accessed.

Mead was fired by Live Nation and Ticketmaster around October 2017.

Court documents show Mead left the US and returned to the UK in 2019. He was arrested in Italy earlier this year and extradited to the US.

Legal steps

In 2015, CrowdSurge’s parent company, Complete Entertainment Resources, filed a civil lawsuit against Ticketmaster, alleging that the company dominated the market and “attempted to destroy competition in the presale market for artist tickets through various means.”

These included ‘blocking’ numerous artists from working with SongKick, a company CrowdSurge had merged with in June 2015, and using the company’s market power to ‘force’ them to work with Ticketmaster instead.

Ticketmaster and SongKick settled their legal dispute in 2018, resulting in Ticketmaster paying $110 million to SongKick’s owners and purchasing SongKick’s ticketing technology for an undisclosed amount.

Ticketmaster entered into a deferred prosecution agreement with the New York Department of Justice after pleading guilty to five counts of fraud in 2020. Under this process, a company reaches an agreement with a prosecutor under which the company is charged with a criminal offense but the proceedings are automatically stayed.

The ticketing giant was fined $10 million and agreed to “modify or maintain its existing compliance program as necessary and appropriate.”

The U.S. Department of Justice confirmed that Ticketmaster met the terms of the deferred prosecution in July 2024.