Ticketmaster faces class-action lawsuit over 'deceptive fees'
The California lawsuit , which was filed in 2003 and recently granted national class-action status, challenges Ticketmaster's "Order Processing Fee" and the fee it charges customers who opt for UPS Delivery on its website for all online ticket purchases made by U.S. residents between October 21, 1999 and May 31, 2010.Considering that Ticketmaster sold more than 95 million tickets valued at more than $4 billion in 2002 alone, according to the suit, that's a lot of potential claimants. So if you're one of the millions who's used the Ticketmaster website, you may be receiving an e-mail that looks something like this.
According to the complaint, Ticketmaster's Order Processing Fee is "deceptive and leads consumers to believe that it represents Ticketmaster's costs to process their orders, and that the Order Processing Fee is [in fact] just a profit component for Ticketmaster, unrelated to the costs of processing the orders."
A second claim involves only Ticketmaster customers who paid for UPS Delivery of their tickets, which it also claims is deceptive because Ticketmaster "substantially marks-up the amount it actually pays to UPS."
Ticketmaster disputes the allegations and disputes that any of its practices are deceptive.
One of the defendants, Curt Schlesinger, purchased four Wilco tickets from Ticketmaster in 2003 and paid an additional $19.50 for UPS delivery, which he assumed represented the actual delivery cost. However, the suit charges, the actual UPS rate to his home was only $16.35, and thanks to its discounted rates, Ticketmaster paid "substantially less" than $16.35. "As such, a portion of the $19.50 UPS delivery charge Schlesinger paid for delivery was secretly pocketed by Ticketmaster," the complaint alleges.
Schlesinger was also charged an Order Processing Charge of $3.10, which the suit alleges is "a profit generator for Ticketmaster, unrelated to the cost of processing tickets and designed to maximize Ticketmaster's overall profit by obtaining a bottom-line dollar amount on deals with its clients."
The other defendant, Peter Lo Re, makes similar claims against over Bruce Springsteen tickets he purchased from Ticketmaster via UPS.
According to the Ticketmaster website:
The site's page on UPS delivery makes no statement about how UPS fees are assessed.The order processing fee covers the cost to fulfill your ticket request when you purchase the tickets online or by phone. This charge includes services, such as taking and maintaining your order on our ticketing systems, arranging for shipping and/or coordinating with the box office will call. It is applied to an entire order. Both the venue or promoter and Ticketmaster determine the charge on an event-by-event basis. In almost all cases, additional delivery prices may be charged based on the delivery method that you choose.
Schlesinger and Lo Re are seeking a court award of "appropriate relief," and demand that Ticketmaster refund each class member any money it earned illegally. A non-jury trial is scheduled to begin January 26, 2011.
Ticketmaster is no stranger to controversy over high ticket prices and what many see as its near-monopoly on the concert ticket market – market dominance that only increased following its merger with Live Nation Entertainment.
Earlier this year, TicketMaster settled charges by the Federal Trade Commission that it duped fans with bait-and-switch tactics that tricked more than 1,000 of its customers into paying double, triple and even quadruple the face value of Bruce Springsteen tickets. The FTC recently mailed refund forms to the hoodwinked Springsteen fans.