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Pascrell Highlights FTC Tickets Workshop Report

Government consumer watchdog shows need for reforming live events marketplace

Paterson, NJ, May 13, 2020

PATERSON, NJ – U.S. Rep. Bill Pascrell, Jr. (D-NJ-09) today reacted to a report issued by the Federal Trade Commission (FTC) recapping the findings of its 2019 “That’s The Ticket” workshop on pervasive problems in the corrupted live events ticket market. 

“The FTC’s findings show a ticket marketplace in turmoil and in desperate need of changes,” said Rep. Pascrell, a longtime congressional advocate of ticket reform. “The pandemic has inadvertently exposed how the tickets market squeezes consumers of their hard-earned money. My BOSS Act legislation will address, head-on, many of the legitimate complaints and fears raised by consumers and highlighted by the FTC’s workshop to impose broad regulation over a wild west market for the first time. I want to commend Chairman Joseph Simons and the rest of the FTC commissioners for their focus on the corrupted ticket industry and urge them to keep looking and use their full powers to take action on behalf of American consumers.”

Pascrell is the longtime principal sponsor of the BOSS Act, overarching legislation that will impose a basic level of transparency to the ticket industry so fans have a fair chance to purchase tickets on the primary market and also seeks to protect consumers who choose to use the secondary market to purchase tickets. The legislation was the subject of a House Energy and Commerce Subcommittee hearing earlier this year and is now being considered by the full House. A full section-by-section of the legislation is available here.

Key FTC workshop findings

Broken ticket market. The FTC highlighted that the live events ticket market “is broken in significant ways” and that as the market has evolved technologically, “consumers have not necessarily realized the benefits of the resulting massive economies of scale.” The BOSS Act seeks broad reforms of the primary and secondary ticket markets that benefit consumers.

 

The need for greater transparency. The workshop discussed the need for greater transparency in sales, with “[b]rokers and resale market platforms assert[ing] that such information would help manage consumer expectations about their chances of obtaining tickets to particular events and assist in their buying decisions” and participants representing artists opining that “increased transparency about ticket allocations could simply provide a roadmap for brokers” to produce lower prices. A key component of the BOSS Act is creating wide-ranging required transparency of the marketplace for the first time.

 

Stopping BOTS from buying up tickets. The workshop looked at the efficacy of the BOTS Act of 2016 that made is illegal to use computer programs to go around set limits on bulk-ticket purchases. The BOSS Act would require the FTC to do a full study of the BOTS Act’s effectiveness, as well as expand on the BOTS Act’s narrow scope.

 

Limited transferability. The FTC event assessed whether transferability rules would help consumers: “Restricting ticket transferability could impose artificial price floors for events that do not sell out, and would eliminate the role of brokers in off-loading risks for sports teams and entertainers by purchasing tickets up front, assuming the risk that some tickets will not be resold. Some participants argued that limiting ticket transfers or resales to a single platform could deter competition and ultimately harm consumers.” The BOSS Act has explicit prohibitions on restricting the ability of a purchaser who has purchased tickets from a primary ticket seller to resell their tickets.

 

Advocating all-in ticket pricing. “All of the workshop panelists who discussed the fees issue, including each participating ticket seller that does not currently provide upfront all-in pricing, favored requiring all-in pricing through federal legislation or rulemaking.” The BOSS Act would require all-in pricing to ensure ticket sellers disclose all ancillary charges before customers select a ticket for purchase and transparency in the sale of speculative tickets in the secondary market.

 

Cracking down on ticket speculation. The FTC conducted considerable analysis of pervasive speculation in ticket selling, finding that “even when sellers do disclose clearly, consumers still do not understand, and may pay more for speculative tickets than they would for available, actual tickets; and when sellers fail to deliver actual tickets, consumers may incur losses that significantly exceed the ticket price.” Several participants praised the BOSS Act, which would impose hard transparency in the sale of speculative tickets.

 

Banning deceptive websites. The FTC report noted that “[d]espite Commission enforcement efforts, numerous ticket resellers continue to use deceptive website URLs and landing pages that are difficult to distinguish from those of venues, artists, or other primary ticket sellers.” There was a specific recommendation by workshop participants that “federal legislation and increased law enforcement” is needed because “self-regulation is unlikely to deter resellers who engage in deceptive practices by making themselves look like primary sellers.” The BOSS ACT restricts secondary ticket sales marketplace from misrepresenting affiliation or endorsement of a venue, team, or artist, without their express written consent.

 

Conclusion. Summing up the workshop’s findings, the FTC made clear that action is needed: “Throughout the workshop, participants suggested federal legislation, together with strong enforcement and meaningful penalties, to address various practices in the primary and resale ticket marketplaces that cause consumer injury.”

 

A copy of the FTC’s report can be found here.

 

Congressman Pascrell has been a leader in Congress calling for regulation of the opaque live events ticket market. Pascrell was an early critic of the Live Nation-Ticketmaster merger, and repeatedly urged the Obama administration to reject it, warning that the union would crush competition and harm consumers. In May 2018, Pascrell wrote an op-ed in the Los Angeles Times on his attempts to impose greater positive regulation on the broken live events ticket market.

 

Two months later, Reps. Pascrell and House Energy and Commerce Chairman Frank Pallone, Jr. (D-NJ-06) wrote a letter to FTC chairman Joseph Simons highlighting a Government Accountability Office (GAO) study which found a myriad of consumer protection and competition issues in the primary and secondary live event ticket markets. The GAO report was commissioned in response to Pallone and Pascrell’s work, and the members urged Simons to do more to protect consumers in the marketplace. In response, the FTC organized the “That’s the Ticket” workshop held in June 2019 to review many of the challenges faced by ticket-buying fans.  

 

In September 2018, Pascrell was featured in a wide-ranging investigation by the Canadian Broadcasting Corporation into corruption in the live events ticket marketplace. Pascrell’s interview segment is available here, and the next month Pascrell wrote a letter to then-U.S. Attorney General Jeff Sessions calling for the U.S. Justice Department to open an investigation of continued market corruption by Ticketmaster.

 

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