CONSUMER / COMPETITION
The acting New York Attorney General Barbara Underwood is facing two lawsuits from the
Connecticut based ticketing companies TicketNetwork and Ticket Galaxy in what they say is a response to a “deeply flawed interpretation of New York State Law” on the resale of event tickets. The new Attorney General (NYAG) after she announced plans to sue for millions of dollars to prevent the site listing tickets sellers do not yet own. With both companies saying they have fully co-operated with a two year investigation into the re-sale market by the office of the NYAG,, they are now seeking a declaratory judgement in New York’s Supreme Court regarding the lawful sale of tickets not yet in the seller’s possession.
Ticket resale prior to ownership of the ticket is specifically allowed in the state of New York – a two-year extension of the existing law with some revisions that specifically addressed this practice was passed earlier this year and signed by Gov. Andrew Cuomo.
A press release from TicketNetwork reads: “Through this lawsuit, the Company is seeking the Court’s conclusive affirmance for its position that it operates in full compliance with all applicable regulations, and that the NYAG has no basis to allege that the Company’s practices violate any state or federal law”
Chief Operating Officer Mike Honeyman said “We have been forced to seek Court protection in response to the New York Attorney General’s baseless claims and threats against TicketNetwork” adding “he NYAG knows full well that we have immunity under the Communications Decency Act of 1996 and that New York state laws and administrative guidance permit these types of sales. Despite that, the NYAG appears intent to press on with this course of action. Online commerce would be severely negatively impacted, and consumers would see a decrease in competition and an increase in costs if the protections afforded to online marketplaces such as Amazon, eBay and innumerable others were selectively ignored. We are asking the Court to reaffirm that online marketplaces are protected under federal law, as it is apparent that the NYAG’s Office needs a reminder of this longstanding principle. In addition, given the recently enacted New York law, we are confident the Court will determine that we are in full compliance with the law.”
Underwood’s office responded via an email sent to Reuters saying “Speculative tickets harm both consumers and the industry as a whole – driving up ticket prices and defrauding consumers by leading them to believe they are buying an actual ticket, rather than making a bet on the seller’s ability to deliver the ticket for which they paid” and “We will respond to this baseless lawsuit in court.”
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