Ticketmaster settles on Springsteen scalping
Ticketmaster will refund Bruce Springsteen fans up to $1 million or more to settle a federal complaint against it and two Northwest suburban subsidiaries alleging it scalped tickets or promoted the sale of ones that didn't exist, according to the U.S. Federal Trade Commission.
The deal, filed Thursday in federal court in Chicago, seals the FTC complaint over tickets for 14 of Springsteen's concerts. The complaint alleged Ticketmaster engaged in "unfair or deceptive acts." TicketsNow.com, based in Rolling Meadows, and its corporate entity TNOW Entertainment, out of Crystal Lake, owned by Ticketmaster, which is based in Southern California, according to the complaint.
Ticketmaster, which merged with Live Nation Entertainment Inc. last month, was accused of steering Springsteen fans to its TicketsNow resale Web site a year ago and inflating the price of tickets for concerts last May and June.
Springsteen described the practice as "scalping" and said he was "furious" over it, adding in a statement issued through his management, "We condemn this practice."
The Federal Trade Commission said Ticketmaster also failed to tell consumers that resale tickets for the concerts that were advertised on its TicketsNow Web site might not actually be available. Some tickets were being sold speculatively, according to the original complaint.
"Buying tickets should not be a game of chance," FTC Chairman Jon Leibowitz told reporters on a conference call Thursday. He estimated that thousands of overcharged fans may be entitled to more than $1 million, as Ticketmaster agreed to reinstate the difference in price between the charged cost and face value.
Leibowitz said Ticketmaster directed customers to TicketsNow without revealing that fans might be buying "phantom tickets." The commission labeled the practice "deceptive bait-and-switch tactics."
Leibowitz also said the FTC is sending letters to about 10 major ticket resellers to warn them against engaging in similar deceptive practices. The commission intends to "clean up the Wild West of ticket selling," he said. "If you deceive, we will go after you."
Live Nation Entertainment said in a statement it "is pleased with the terms" of the settlement and praised the FTC's "diligence in closely investigating this matter."
Ticketmaster a year ago claimed the Springsteen concert issue involved a computer "glitch" that affected a "very small number" of fans.
Leibowitz said some fans paid four times the face value of the tickets.
Ticketmaster last year reached a separate settlement with New Jersey regulators, agreeing to provide 2,000 tickets for two concerts in that state for people who complained. The company also agreed to stop linking to TicketsNow from the Ticketmaster Web site for at least a year and to limit advertising for the resale site.
Ticketmaster purchased TicketsNow in February 2008 for $279.4 million, according to a March 31 regulatory filing. The site competes against eBay Inc.'s StubHub, the largest ticket reseller Web site.
Daily Herald wire services contributed to this report.