FTC orders refunds to Springsteen ticket buyers, sweeping changes in ticket resale market

Calling for an end to deceptive "bait and switch" tactics, the Federal Trade Commission Thursday announced a settlement with Live Nation Entertainment Inc.'s Ticketmaster unit that requires the company to provide full refunds to consumers who bought tickets to 14 Bruce Springsteen concerts at dramatically inflated prices.

FTC Chairman Jon Leibowitz said thousands of fans were steered to TicketsNow, a resale site owned by Ticketmaster, where they were charged premiums of double, triple or quadruple the $90 face value.

Other Springsteen fans were sold phantom tickets that never materialized, Leibowitz said. Ticketmaster failed to tell buyers that many of the resale tickets advertised on TicketsNow.com were not “in hand," but being sold speculatively. TicketsNow was only offering to find tickets to the Springsteen concert at the Verizon Center in Washington.

"Who in their right mind would spend $1,600 on tickets that they may or may not get?" Leibowitz said. "Any fan who didn't get a refund -- they will get them from this settlement."

Leibowitz estimated the settlement could refund as much as $1 million to thousands of consumers who were duped.

The FTC also called for dramatic changes in disclosure to make clear to consumers whether tickets are actually "in hand" or if they're being sold speculatively. Leibowitz said his agency is sending out warning letters to 10 other major ticket resellers, recommending that they review their websites "to ensure that you are not making any misleading statements or failing to provide material information to prospective purchasers of tickets listed on your site.”

Leibowitz declined to identify which sites would receive the letter.

"It seems to me [that] by far the worst part of what we found, investigating this industry in the context of our investigation of Ticketmaster, is that they were selling these tickets they didn't have," Leibowitz said.

The issue came to the attention of the FTC when Springsteen publicly criticized Ticketmaster about its handling of sales for concerts in May and June. Fans who went scouring for tickets on the website were met with the message "no tickets found." The FTC charged that Ticketmaster used its website to direct unwitting consumers to its TicketsNow site, where tickets were sold at prices of up to $400 a seat -- a dramatic premium on the $90 face value.

"Many consumers had no idea what was going on," Leibowitz said.

Ticketmaster also displayed the same misleading Web page to consumers looking to buy tickets for many other events between October 2008 and February 2009, the agency charged.

-- Dawn C. Chmielewski

Comments

[Evad the Slayer]

Ticketmaster and its subsidiary TicketsNow are nothing less than legalized scammers. If they were at the arena trying to scam tickets, they would be arrested on the spot under most state laws. Yet, because the feds failed to block this merger of rip-off companies, there is virtuall no competition to force them to keep prices rational. My goodness, what a business. No wonder they reap MILLIONS a year in profits for doing absolutely NOTHING. They don't create, don't manufacture anything. Just suck off the blood of performing artists and legally scam money out of fans.

[jack English]

YEY................JACK..HOLLYWOOD, CALIF.....

[Kenarmy]

Are they a subsidiary of Goldman, Sachs?

[Gary]

what ever happened to anti-scalping laws? no ticket should be sold for more than a "modest" service charge above it's face value

[Drew]

I don't have too much of a problem with "legitimate" ticket scalpers. Hell, I helped put myself through college by scalping tickets to shows.

I have a major problem with Ticketmaster scalping its own tickets before they are ever even sold to the public at face value, however. If they want $400 a ticket, they should price them that high to begin with.

As far as the Ticketmaster/LiveNation merger -- kill it now. It's clearly a violation of antitrust laws.

[Ron]

Springsteen is a greedy spoiled brat.
Does he realize only new jersey,ney your and boston were sellouts and most west coast shows were a bomb and people lost money,but the brokers secured that market for him.
"If it wasn't for the brokers some dates would have been cancelled"
If t wasn't for the super bowl hype the tour would be cancelled.
This guy is way passed his prime....RETIRE !

[Dean Corso]

It would be much better for consumers if artists sold their own tickets from their own websites and locked these greedy market manipulators out. Its not that difficult to incorporate into the management of concert production. Why do we have to buy tickets from middlemen and not directly from Bruce Springsteen? We don't!

[Durable Good]

Monopolies are the purest form of capitalism, and We the Serfs aren't going to take it anymore, unless they're fifth row center.
Anti-Trust? Regulation? How quaint. We're Americans, dammit!

[Gill]

Why Americans immigrate to Canada?
Answer: Because of Bruce Springsteen!
Why Canadians immigrate to US?
Answer: Because of Celine Dion!

[Eric of Reseda]

Why are these people allowed to stay in business?!? What the heck is going on with American business?!? Everywhere you turn, businesses are demonstrating hostile and CRIMINAL tactics toward the consumer!!! This country is FALLING apart, and it's GREED, GREED, GREED! And Wall St. has convinced FAR too many Americans that this sort of perverted capitalism is a good thing. To hell with capitalism and the illusion that is the "free market". This story amply demonstrates that the "free market" is anything but free or just or an advantage to the consumer.

[Big Bomb]

If only Eddie Veddar could have slayed the beast all those years ago ...