Oregon Festival Sues Coachella Over Five-State Radius Clause, Alleged Anti-Competitive Behavior

Frazer Harrison/Getty Images for Coachella
A general view of the atmosphere during day 1 of the 2014 Coachella Valley Music & Arts Festival at the Empire Polo Club on April 11, 2014 in Indio, Calif.

The federal lawsuit takes aim at mandates in event promoter Goldenvoice's artist contracts.

An Oregon music festival is suing Coachella, which begins Friday, as well as organizers AEG Presents and Goldenvoice, arguing the festival's radius clauses restricting where artists can play before and after the California festival violates anti-trust and unfair competition laws and creates "an illegal monopoly in the market for live music festival performances."

Lawyers for Soul’d Out Music Festival founders Nicholas Harris and Haytham Abdulhadi say they had approached TDE artist SZA to play this year's event but were turned down because of the radius clause, barring her from playing other West Coast states. When Harris and Abdulhadi reached out to Goldenvoice for a waiver, the concert promoter refused. 

Same goes for artist Daniel Caesar, who allegedly declined to perform at the Soul’d Out Music Festival because of the Coachella radius clause. According to a suit filed in U.S. District Court, Coachella officials stand accused of requiring acts to sign a radius clause that bars artists from playing within a five-state radius of Indio, California, during a five-month period from December until May, a month after the event, which takes place this year April 13-15 and 20-22 and features headliners The Weeknd, Beyonce and Eminem. Billboard reached out to Goldenvoice and was told Coachella organizers had no comment.

The Soul’d Out festival, by comparison, takes place April 18-22 and this year includes Erykah Badu, De La Soul and Wyclef Jean, spread out over five Portland venues. Lawyers for Harris and Abdulhadi argue Coachella organizers are allegedly engaging in "an unlawful restraint on trade, meant to use Coachella’s market power in the music festival market to suppress competition by other festivals."

Lawyer Nicholas F. Aldrich says numerous artists have turned down participating in Soul'd Out, citing "the unlawful radius clause in their contracts with Coachella as the sole reason that they cannot do so." It also accuses Goldenvoice of utilizing a tying arrangement to allow artists to break the radius clause by performing at AEG-sanctioned events while enforcing the agreement for competing events.

According to an alleged copy of the radius clause, included in the lawsuit, artists playing this year's festival are restricted from playing any festival or themed event in California, Nevada, Oregon, Washington or Arizona from December 15, 2017, until May 7, 2018. Aldrich argues radius clause agreements hurt smaller cities and festival programmers and don't provide many benefits to Coachella since the event sells out months in advance.

Besides SZA, Aldrich argues that New Orleans band Tank and The Bangas had confirmed their plans to perform at Soul'D Out only to cancel after the radius clause complications became an issue. 

Aldrich is accusing Goldenvoice and AEG of violating anti-trust statues by "unreasonably restricting price and cost of competition among live concert venues" and "limiting entry or expansion of competitors" in "the states of California, Nevada, Oregon, Washington, or Arizona" which they allege hurts fans and smaller concert promoters. Aldrich is also asking the court to throw out radius clause agreements because they're allegedly an unlawful restraint on trade under California law, as well as claims of unfair competition and intentional interference.

Festivals 2018