New Maryland Bill Targets Fraudulent Ticket Resellers & Promises to Punish Platforms That Host Them
Written by djfrosty on April 5, 2024
Elected officials in Maryland are currently moving a ticketing reform bill titled SB0539 through the state legislature, with approval from both the House and Senate pending. The proposed law is a consumer protection bill aimed at the sale and resale of live event tickets that has been endorsed by the Recording Academy, National Independent Venue Association (NIVA), National Independent Talent Organization (NITO), Eventbrite and more.
The current iteration of the bill would ban speculative ticketing (the practice of listing tickets on secondary sites before a reseller owns a ticket), as well as require ticketers to present “all in” pricing for consumers, meaning the full price of the ticket — including all fees — must be present in the price first shown to fans. The bill would pertain to concerts, theater shows and live sporting events.
Based on the bill’s language, resellers will have to provide the zone and seat number for non-general admission events. This would eliminate the common practice of resellers listing an unspecified seat and procuring a ticket — for a lesser price — once a consumer has purchased the “unspecified” seat from a secondary site. It would also reduce resellers’ ability to list generic tickets on resale sites before on-sale for the actual event has occurred.
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Audrey Fix Schaefer, vp of the board of directors and communications director for the National Independent Venue Association (NIVA), tells Billboard that fans regularly search online for concert tickets for shows promoted by I.M.P. — where she also serves as communications director — and are directed to misleading secondary sites that mark up the price or offer tickets for events that haven’t yet gone on sale.
“It’s fraud,” she says. “It’s unregulated arbitrage that deceives fans into thinking that they have to overpay because they can’t get a ticket through us. They figure that it sold out when the tickets haven’t been put on sale.”
Fix Schaefer gives the example of Mitski’s upcoming tour, which will make two stops at I.M.P.’s Merriweather Post Pavilion in Columbia, Md., later this year. For those shows, $125 tickets were being advertised on secondary sites for $12,000 before the actual on-sale. “That’s obscene,” she says, and “there isn’t a single show [resellers] don’t do this on.”
The Maryland bill would also make it illegal for secondary ticketing platforms to provide a marketplace for the sale or resale of tickets that violate the law. If a consumer purchases a ticket that is counterfeit, canceled by the reseller or fails to meet its original description, the secondary platform would be responsible for paying the consumer back for the total amount paid, including any fees.
Making the platforms responsible for the refunds is “a huge win,” says Fix Schaefer, who notes that other consumer protection ticketing laws like the federal Better Online Ticket Sales (BOTS) Act tend to go after individual resellers who are harder to prosecute. Several states around the country are also looking to tackle unfair ticketing practices, including Arizona’s HB2040 (informally known as the “Taylor Swift bill”), which would make it illegal to use bots to purchase unauthorized amounts of tickets or circumvent electronic queues to skip lines ahead of waiting fans. But similar to the federal BOTS Act, the fines for violating these proposed laws would be borne by individuals — not the platforms.
Secondary ticketing platforms, Fix Schaefer adds, are “not going to want to take [the] hit for [resellers]…it’s like having a storefront where they know they’re selling illegal goods but they say, ‘Oh, I just rented that shelf out so somebody.’ No. You’re responsible.”
The Maryland bill would also mandate “all-in” ticket pricing — where consumers see the full price of the ticket, including fees, from the beginning of their transaction — and require those fees to be itemized so fans know where their dollars are going. Nathaniel Marro, managing director of NITO, explains that this portion of the bill will greatly benefit artists. “Artists have no capability of controlling the fees. They don’t make any money off those fees. They are going to the venue and the promoter and the ticketing company,” he says. “The artist wants those fees separated because when fans complain and get upset about how much tickets cost, the only people they are going to point to is the artist.”
Artists will also benefit from fans not spending their entire entertainment budgets on tickets alone. As Marro argues, most fans have a finite level of ancillary income and, if they are spending all or most of it on the ticket, that’s less money spent on music and merch, which goes directly to the performers they came to see.
While other measures, including a cap on resale prices and one that would have compelled secondary sites to identify resellers who are breaking the law, were stricken from the bill as it passed through the state legislature last month, a provision that remained was the commission of a study looking into ticketing practices. If the bill is passed, The Consumer Protection Division of the Office of the Attorney General will conduct a review of how resellers are procuring their tickets, the price difference for fans on the primary versus secondary market, fraudulent tickets, the use of bots, what measures other states have enacted to protect consumers during the ticket buying process and more.
Fix Schaefer predicts that the study, which would be produced by the end of 2024, would succeed in bringing legislatures back to the table on measures like resale caps. “As they are gathering the facts and the data to see what kind of consumer deception and gouging occurs,” she says, “they will be left with a mission to come back and do more.”