Tim Leiweke, the co-founder of venue management and development company Oak View Group, is stepping down from the company after the Department of Justice‘s antitrust division indicted him on Wednesday over allegations of bid-rigging to secure the development of the Moody Center in Austin, Texas.
The DOJ said Wednesday that it had charged Leiweke with a violation of Section 1 of the Sherman Act, which if convicted carries a maximum 10-year prison sentence and a fine of $1 million. In the indictment, the DOJ alleges that Leiweke had conspired with the CEO of rival company Legends Hospitality from February 2018 through at least June 2024 over the development of the Moody Center at the University of Texas.
“Mr. Leiweke has done nothing wrong and will vigorously defend himself and his well-deserved reputation for fairness and integrity,” a spokesperson for Leiweke said in a statement. “The Antitrust Division’s allegations are wrong on the law and the facts, and the case should never have been brought. The law is clear: vertical, complementary business partnerships, like the one contemplated between OVG and Legends, are legal. These allegations blatantly ignore established legal precedent and seek to criminalize common teaming efforts that are proven to enhance competition and benefit the public. The Moody Center is a perfect example, as it has resulted in substantial and sustained benefits to the University of Texas and the City of Austin.”
On Wednesday, OVG confirmed that Leiweke would transition from CEO to vice chairman of OVG’s board of directors, and that he would still be a shareholder in the company. OVG360 president Chris Granger will step in as interim CEO.
As the DOJ states, in September 2017, Leiweke told several colleagues that Legends was “bidding against us” to win the contract for the new arena, and that he’d “get them to back down” and “find a way to get [the competitor] some of the business.” Leiweke subsequently said in November 2017 that he was “more than happy talking to [the competitor] about not bidding and [receiving certain subcontracts]” in return, but he also said he had “no interest in working with them if they intend on putting in a bid” on the arena.
By February 2018, the DOJ said, Leiweke “ultimately reached an agreement with the competitor’s CEO, pursuant to which the competitor agreed that it would stand down and neither submit nor join an independent competing bid for the Arena Project.” In exchange for the competitor’s agreement to stand down, Leiweke represented that the competitor would receive Arena Project’s subcontracts. Consistent with the bid-rigging agreement, the competitor did not submit a competing bid for the Arena Project. OVG ultimately submitted the sole qualified bid and won the Arena Project.
“As outlined in the indictment, the Defendant rigged a bidding process to benefit his own company and deprived a public university and taxpayers of the benefits of competitive bidding,” Assistant Attorney General Abigail Slater, who leads the Justice Department’s Antitrust Division, said in a statement. “The Antitrust Division and its law enforcement partners will continue to hold executives who cheat to avoid competition accountable.”
U.S. attorney Justin Simmons for the Western District of Texas said in a statement that “unfair business practices, like those employed here, make it very difficult for the American people to pursue prosperity like our founders intended.”
Leiweke co-founded Oak View Group alongside industry titan Irving Azoff back in 2015. The company has since become one of the most powerful venue development companies in the industry, with hands in major developments like the Climate Pledge Arena in Seattle, Acrisure Arena in Palm Springs and the UBS Arena in New York. This isn’t the first time Leiweke has been involved in a DOJ inquiry in the live music business, as emails he’d sent were included in the DOJ’s civil complaint against Live Nation last year. (Neither Leiweke nor OVG were named as defendants in that suit.)
Oak View Group and Legends both agreed to pay penalties of $15 million and $1.5 million in penalties and weren’t formally accused of wrongdoing themselves in the DOJ’s indictment. A representative for Legends didn’t immediately respond to a request for comment. In a statement on Wednesday, OVG said the company “cooperated fully with the Antitrust Division’s inquiry and is pleased to have resolved this matter with no charges filed against OVG and no admission of fault or wrongdoing.”
In OVG’s announcement of the leadership change, Leiweke called it “my great honor to help found and lead OVG as it has grown into the special, customer-oriented company it is today.”
“While I’m pleased the company has resolved its Department of Justice Antitrust Division inquiry without any charges filed or admission of wrongdoing, the last thing I want to do is distract from the accomplishments of the team or draw focus away from executing for our partners,” Leiweke said. “So the Board and I decided that now is the right time to implement the succession plan that was already underway and transition out of the CEO role. In my new role as Vice Chairman of the Board and as an OVG shareholder, I remain as committed as ever to the long-term success of the company, and I know OVG, our valued partners and our customers are in great hands with Chris and the rest of our stellar leaders.”
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