NC couple taking on StubHub over ticket markup
Posted December 1, 2011
Greensboro, N.C. — A North Carolina couple is taking on StubHub, the online marketplace where people buy and sell tickets to sporting events, concerts and other live events.
The Greensboro couple, Jeffrey and Lisa Hill, bought tickets on the site in 2007 to a sold-out Hanna Montana concert only to find out after the fact that they paid $93 above face value – along with a 10 percent fee.
At the time, a North Carolina consumer protection law prohibited scalping and capped service fees at $3 per ticket. So the Hills sued StubHub.
The California-based company was in a Raleigh courtroom in front of a three-judge panel Thursday appealing a prior ruling that they violated a state law.
StubHub argues the law did not pertain to them because the seller is the person who listed the tickets, not them. They say they are just the medium that brought the two “willing” parties together. Citing a federal statute “designed to protect ‘Good Samaritan’ internet operators from liability,” StubHub is arguing they have immunity from liability and may provide a for-profit service that relies on outside buyers and sellers.
Lawyers for the Greensboro couple believe StubHub is clearly a seller in this deal.
“They're the one you contract with to buy the tickets,” said Charles Coble, lawyer for Jeffrey and Lisa Hall. “They're the one that charges your credit card. They're the one who you deal with if there's a problem. They're the one who makes arrangements for delivery. They're the one who bears the risk of loss. It's sort of every way you want to look at it in our view.”
The plaintiffs argue that unlike sites such as Craigslist where third parties enter into transactions of “their own choosing,” StubHub, as a single entity, contracts with buyers for the sale of tickets on the website. StubHub collects 25 percent per ticket transaction – 10 percent comes from the buyers fee, the seller contributes the other 15 percent.
A bill proposed in the North Carolina Senate in March of 2007 and passed in 2008 said that “a person may resell an admission ticket under this section on the Internet at a price greater than the price on the face of the ticket,” unless the venue itself prohibits the action.
The new law maintains a capped service fee of $3 unless the venue and a first-sale agent agree upon a greater amount. One stipulation placed on the seller allowing the above-face-value sale is that a full refund and ticket guarantee be offered – something that StubHub does.
“When they bought those tickets, North Carolina law was very clear that you could not sell tickets above face value and you could not add a service fee of more than $3,” Coble said of the Hill’s purchase.
The Greensboro couple also sued the person who listed the tickets on the site and agreed on a settlement. Their lawyers would like to make this a class-action lawsuit. The Court of Appeals on average takes about 90 days to make a decision.