In 2019, a class action lawsuit was filed against Ticketmaster, accusing the company of working with scalpers to artificially inflate ticket prices on the secondary market. The lawsuit alleges that Ticketmaster is violating antitrust laws through price fixing and other anti-competitive practices.
What are the key allegations against Ticketmaster?
The main allegations against Ticketmaster are:
- Colluding with scalpers to artificially drive up resale ticket prices on secondary marketplaces like StubHub
- Hiding the full price of tickets by adding on extra fees later in the purchasing process
- Misleading consumers into believing tickets were sold out when they were actually being held back for presales
- Profiting from inflated resale prices through fees and kickbacks
According to the lawsuit, Ticketmaster’s control of primary ticket sales combined with its ownership of resale marketplaces like StubHub allows it to charge “supracompetitive fees” at every stage.
Who filed the Ticketmaster lawsuit?
The lawsuit was initially filed by consumer rights attorney James Pistorino on behalf of 26 plaintiffs in Wisconsin federal court in October 2019. It was later consolidated into a class action lawsuit representing potentially millions of aggrieved customers nationwide.
The lead plaintiffs named in the case are Matthew McMillan and Marissena Koneru, representing a proposed class of “all persons and entities in the United States who purchased tickets on a resale platform owned by Ticketmaster” between 2015 and 2019.
What evidence does the lawsuit cite?
The lawsuit cites internal communications and agreements uncovered during an undercover investigation by journalists at the Toronto Star and the Associated Press. These include:
- Secret deals between Ticketmaster and scalpers to facilitate mass purchases
- Emails showing Ticketmaster employees providing scalpers with special software to buy tickets
- Agreements where Ticketmaster shares service fees from inflated resale prices with scalpers
The plaintiffs argue this is clear evidence of collusion between Ticketmaster and professional resellers to manipulate the ticket market and defraud consumers.
How has Ticketmaster responded?
Ticketmaster has denied any wrongdoing and is fighting the lawsuit. In its motion to dismiss, Ticketmaster argued:
- It has no control over the independent sellers on resale platforms
- Plaintiffs failed to show they overpaid for tickets specifically due to collusion
- Ticketing services constitute a distinct market from ticket resales
Ticketmaster claims there is no evidence it conspired to fix prices across the supply chain. It asserts that fluctuations in resale prices are simply a function of ordinary market forces.
What are the plaintiffs seeking in damages?
The lawsuit is seeking unspecified monetary damages on behalf of all consumers who bought or sold tickets on Ticketmaster’s resale platforms from 2015 to 2019. No exact damage amount has been cited.
According to legal experts, if Ticketmaster is found liable the damages could potentially amount to hundreds of millions of dollars given the high volume of transactions involved.
Could Ticketmaster face additional legal action?
Yes, Ticketmaster is still facing further potential legal action on several fronts:
- Several different state attorneys general have opened investigations into Ticketmaster’s practices.
- The Department of Justice is reportedly reviewing Ticketmaster’s conduct for possible antitrust violations.
- Other private lawsuits over fees and dynamic pricing policies are still pending.
So while the price gouging class action is the most advanced, Ticketmaster is not yet in the clear and is battling on multiple legal fronts over its business model and market power.
What is the current status of the lawsuit?
Here is a brief timeline of where the price gouging class action currently stands:
- October 2019 – Lawsuit originally filed in Wisconsin federal court
- August 2020 – Ticketmaster motion to dismiss denied
- September 2020 – Case consolidated and transferred to federal court in California
- Ongoing – Discovery and exchange of evidence phase
The plaintiffs succeeded in getting the lawsuit past the initial dismissal phase. The case is now proceeding through the pretrial discovery process. The next key phase will be class certification where the court will decide whether to grant class action status.
When will the Ticketmaster lawsuit be resolved?
It is difficult to predict exactly when the Ticketmaster case could reach a resolution. Major class action lawsuits like this often take years to fully play out.
Based on the typical timeline of these types of cases, legal experts estimate the Ticketmaster litigation likely will not go to trial until at least late 2023 at the earliest. If a settlement is not reached before then, a trial and final verdict may not occur until 2024 or beyond.
The COVID-19 pandemic has also caused significant court backlogs that could further prolong the proceedings. But as one of the most high-profile antitrust cases in recent years, the lawsuit is likely to remain an active and priority case on the federal docket.
Could the lawsuit end in a settlement?
Yes, it is very possible the class action could end in some type of settlement between Ticketmaster and the plaintiffs before a full trial. The majority of class action lawsuits ultimately end in settlement agreements.
Potential advantages of settling for Ticketmaster include avoiding further legal fees and negative publicity. Settlements also typically do not require the defendant to admit guilt. However, Ticketmaster may still choose to fight the case in hopes of getting the lawsuit dismissed before it reaches a jury trial.
If a settlement is reached, affected customers would likely receive some form of compensation or credits based on the number and type of tickets purchased. Settlement terms still require court approval.
What are the broader implications of the lawsuit?
This lawsuit represents a significant challenge to Ticketmaster’s long-running dominance of the event ticketing industry. Key implications include:
- It could expose anti-competitive business practices by Ticketmaster
- May reduce Ticketmaster’s incentives to facilitate inflated resale prices
- Could lead to increased regulation and oversight of ticketing markets
- Opens the door to additional antitrust scrutiny of Ticketmaster
However the lawsuit turns out, legal experts say it will likely spur meaningful changes in how major ticket sellers like Ticketmaster operate. The final verdict or settlement could have lasting impacts on pricing transparency and consumer protections.
Could Ticketmaster be broken up?
In an extreme scenario, the lawsuit findings combined with further antitrust enforcement could hypothetically lead to Ticketmaster being broken up or forced to divest some of its assets. However, this outcome is seen as less likely for a few reasons:
- No specific breakup request has been made in this lawsuit
- Ticketmaster’s core ticketing operations would likely remain intact
- Only vertical breakup of resale units may be required if collusion found
- Full breakup would require further DOJ antitrust lawsuit
According to legal analysts, the more probable outcome if collusion can be proven would be Ticketmaster being forced to sell off its secondary market resale operations such as StubHub and NFL Ticket Exchange. This would separate its primary and resale business activities.
Conclusion
The Ticketmaster price gouging class action lawsuit alleges major antitrust violations through the company’s dealings with professional scalpers and inflated service fees. The case has the potential to shake up the event ticketing industry and improve consumer protections if Ticketmaster is found liable for the claims.
While a definitive outcome is still likely years away, the lawsuit already represents the most serious legal challenge to Ticketmaster’s market dominance. Many consumers and regulators will be closely watching to see if the case succeeds in bringing more transparency, competition and fair pricing to the world of event ticketing.