Ticketmaster Faces Class-Action Lawsuit After Scalping Report

By Mandy Huang
Mandy Huang
Mandy Huang
October 2, 2018Updated: October 2, 2018

Ticketmaster LLC and its parent company Live Nation Entertainment Inc. has been sued in a class action lawsuit for “unlawful and unfair business practices.”

The people affected by the lawsuit would be anyone “who purchased a secondary market Ticketmaster ticket from a professional reseller participating in Ticketmaster’s resale partner program and/or using TradeDesk or a similar system operated by defendants, such as EventInventory,” according to the complaint filed on Sept. 28.

Report by Undercover Reporters Shocks Customers

An undercover report by reporters from the Canadian Broadcasting Corporation (CBC) and Toronto Star newspaper in mid-September revealed that Ticketmaster may have been unfairly working with scalpers to increase profits.

These scalpers acquired a large number of tickets and then resold them on another Ticketmaster platform, allowing the company to charge fees for both the initial and second sales.

The reporters used hidden cameras and approached Ticketmaster representatives at a recent ticketing event in Las Vegas and asked about the company’s program called TradeDesk.

The representatives seemed to indicate that the ticketing company was willing to work with ticket resellers who created a large quantity of fake accounts or used ticket-buying bots to acquire popular tickets on a mass scale, bypassing the company’s ticket-buying limits.

“I have brokers that have literally a couple of hundred accounts,” a sales representative told the reporters. “It’s not something that we look at or report.”

Class lawsuit filed in California Federal Court

Law firm Hagens Berman filed a suit in the U.S. District Court for the Northern District of California on behalf of lead plaintiff Allen Lee, who is represented by Steve Berman and Elaine Byzszewski.

“Have you ever wondered why Ticketmaster has been unable to rid itself of the scalpers who purchase mass quantities of concert or sports tickets from its website and then resell them for much more minutes later?” states the complaint. “The answer: Ticketmaster hasn’t wanted to rid itself of scalpers because, as it turns out, they have been working with them.”

“Ticketmaster has actually facilitated the sale of tickets to the secondary market by secretly implementing a ‘Resale Partner Program’ supported by TradeDesk, which Ticketmaster acknowledges it “built expressly for professional resellers.”

People Can Sign Up for Compensation Online

If you think you bought tickets from one of Ticketmaster’s resale platforms and want to claim compensation, you can find out more information or sign up for free on Hagens Berman’s official website.

“Fan-to-fan” sites involved include:

* TicketExchangeByTicketmaster.com
* Ticketmaster.com/verified
* TicketsNow.com

Hagens Berman has won more than $260 billion in settlements in lawsuits against big companies including Apple, according to its official website.

Two U.S. Senators Demand Classification

Two U.S. senators, Jerry Moran and Richard Blumenthal, who helped pass the BOTS Act to limit using bots to purchase tickets, wrote an open letter to the CEO of Live Nation, Michael Rapino, on Sept. 21. They asked him to clarify the use of Ticketmaster’s resale program, TradeDesk, by Oct. 5.

“TradeDesk users moving up to several million tickets per year, the allegations of the harms to consumers made in this piece are serious and deserve immediate attention,” the two senators wrote.

They asked these questions:

* Describe the event ticket purchasing limits that Ticketmaster currently employs for sales on its primary ticket sales platform. Additionally, how does the company identify computer programs used to circumvent these purchasing limits?

* Do Ticketmaster’s ticket purchasing limits and associated detection practices apply to users of its online program, TradeDesk? If not, please explain.

* What are the specific rules and processes of compliance for participating TradeDesk users as it relates to ticket purchasing limits and other relevant consumer protection priorities? Please share any documents and guidance materials that are provided to TradeDesk users.

* What role does Ticketmaster’s Professional Reseller Handbook play in deterring its resellers from engaging in illegal ticket purchasing activities?

Ticketmaster was bought by Live Nation in 2010, and it brought in $10.3 billion in revenue last year by selling concerts, sports, theater shows, and other events tickets. Resale tickets account for a $5 billion industry, the complaint states.

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