Stubhub is Suing The Warriors and Ticketmaster

The legalized ticket scalping on Stubhub, Ticketmaster and other similar sites has been a controversial issue since they started, but they have become a generally accepted way to buy tickets to sold out events. Ticketmaster allows you to purchase tickets to shows and then turn around and put them on their re-sale site to make money and Ticketmaster wins by taking fees from the initial sale and the secondary sale. This hardly seems like a fair practice and makes it even more difficult for real fans to purchase tickets to shows and sporting events.

The Golden State Warrior’s incredible 2014-2015 season has caused the secondary ticket market to explode as the premium on tickets has made many fans unload some of their tickets for profit. Because of this, The Warriors have allegedly informed their season-ticket holders that they are only allowed to sell tickets through Ticketmaster’s Exchange and NBATickets.com or face the possibility of losing their season tickets and a chance to buy Playoff tickets.

Stubhub, which saw an 80% decline in postings for the hottest ticket in the NBA, wasn’t pleased with the decision. Claiming illegal anti-competitive actions, they filed a suit against The Warriors and Ticketmaster.

This will be an interesting case and the decision will have an huge impact on the future of the re-sale market.
From ESPN (original article here):

“In what could prove to be a landmark case in the sports ticket marketplace, StubHub filed a lawsuit against the Golden State Warriors and Ticketmaster in the northern district of California on Sunday, accusing the two of conspiring to create an illegal resale market by telling season-ticket holders to only resell through their platform.

The suit alleges that the team has informed season-ticket holders should they resell their tickets through anything other than Ticketmaster’s exchange, NBATickets.com, they will have their ticket privileges revoked.

This included not being offered playoff tickets to the season in which they had already purchased season tickets or not being invited to purchase season tickets for next season.

The threat has apparently worked. StubHub claims that listings for Warriors tickets, which is currently the hottest ticket in the NBA, are down 80 percent in the past year.

“If the anti-competitive actions complained herein are not stopped, Ticketmaster is likely to seek to replicate them with other teams,” the suit said. “As a result, millions of Americans will be held captive to a monopoly secondary ticketing exchange.”

The Warriors and Ticketmaster have had a relationship since 2012 whereby they share fees from the team’s resale market. But sources told ESPN.com that the team got more restrictive and adamant about selling outside of their platform this season, as the Warriors have been one of the best teams in the NBA.

“We’re not trying to be the industry pariah, but when actions like these are associated with the business impact that we’ve seen, and the outcry comes from fans who are saying ‘our hands are tied,’ we are left with no choice,” said StubHub’s general counsel, Michelle Fang.

At the heart of the antitrust case, StubHub’s legal representatives write, is the fact that the Warriors and Ticketmaster are in control of both the primary and secondary markets.

Besides taking part in what StubHub claims is an illegal restraint of trade at the federal level, the eBay-owned reseller also claims that the setup violates unfair business practices in the state of California, where StubHub, Ticketmaster and the Warriors are all based.

Warriors spokesperson Lisa Goodwin said late Sunday night that it was team policy not to comment on legal matters. A representative for Ticketmaster also said the company would have no comment at this time.

Earlier this month, the Warriors clinched a playoff spot for the third consecutive season, the first time they’ve accomplished that feat since 1975-77. On Saturday, the team clinched the top spot in the West.

With the favorite for MVP, Stephen Curry, the Warriors have maxed out their season ticket base at 14,500 seats. The team, which has sold out 118 straight home games, currently has more than 10,000 people on their season-ticket waiting list who have paid $100 nonrefundable deposits to be on the list.”