StubHub Sues Golden State, Alleging Monopoly Over Ticket Reselling

[Redzone]

"In what could prove to be a landmark case in the sports ticket marketplace, StubHub filed a lawsuit against the Golden State Warriors and Ticketmaster in the northern district of California on Sunday, accusing the two of conspiring to create an illegal resale market by telling season-ticket holders to only resell through their platform..." StubHub sues Golden State Warriors, alleging monopoly - ESPN

This will be an interesting case, filed yesterday, to watch, given that Cavs season ticketholders can only resell on flashseats. I wonder if StubHub will file other suits in other states or first await the outcome of this one, which could take years. I also wonder if StubHub will pursue a preliminary injunction to try to stop the prohibition on reselling while the suit is pending.

 

[I'mWithDan]

If nothing else, I would assume this will make financials public.

I'll be interested to see how much teams profit from all the bullshit charges they tack on. Many times FlashSeats charges you an admission tax for games you don't even go to. It's insane. Why the fuck am I charged an admission tax for a game I don't even go to? I wonder if GSW is doing the same.

My biggest gripe with teams controlling secondary markets though is how the Cavaliers were just dumping single game tickets they withheld. They were absolutely DESTROYING the secondary re-sale market for season ticket holders. I don't buy season tickets to make money, I buy them to guarantee seats to any good games and also playoff priority but my reward for giving the Cavs thousands of dollars in advance (I'm already paying for 20516 seats) is for them to make it hard for me to sell seats, many times, for face value. I ended up about breaking even on my tickets this season, which is fine but it shouldn't be that much of a struggle given the on court product.

 

[theSTEREO.]

Yeah, the outcome of this should directly affect the Cavs. Very similar situation.

 

[Redzone]

One argument with any monopoly in the case is that the team can charge higher fees, etc. than if competition was allowed. (not to mention lost profits) Antitrust suits can also result in treble or triple damages plus attorney fees; thus these cases can be lucrative. As we live in a copycat legal world, I look for more of these suits, including those brought by other reseller sites.

If Golden State wins and its reselling restrictions are upheld, I believe other teams from other sports, i.e., football, will have similar reselling prohibitions, resulting in higher fees, etc.

California may have been selected as a forum as StuhHub may believe it is a favorable forum for its case.

 

[natedagg]

So wait, @I'mWithDan , let me make sure that I have this right: you can only resell season tix through flashseats? So you cannot obtain the physical ticket copies and then resell those anywhere like Craigslist, the Classifieds, etc.? Or is it just hard and a PITA to do any other way?

Way bogus that you bought this year's season tickets sometime last year, pre-LeBron/KI/Love/Mozgov/Shump/JR, and the system is such that you are going to break even. I thought you would have been able to make a killing.

 

[I'mWithDan]

So wait, @I'mWithDan , let me make sure that I have this right: you can only resell season tix through flashseats? So you cannot obtain the physical ticket copies and then resell those anywhere like Craigslist, the Classifieds, etc.? Or is it just hard and a PITA to do any other way?

Way bogus that you bought this year's season tickets sometime last year, pre-LeBron/KI/Love/Mozgov/Shump/JR, and the system is such that you are going to break even. I thought you would have been able to make a killing.

The team did away with hard tickets this season. Your only option was FlashSeats . The Cavs also put language in that reserves them the right to revoke season tickets if you sell them elsewhere. Stories surfaced on here of people who had tickets revoked / suspended for selling PRE-SEASON tickets on StubHub or the like. Can't verify that but it raised some eyebrows.

There was even language that went further than that, stating if they deem you to be a "broker" that they can also suspend or terminate your account. That "broker" provision could be looked at if you sold as little as 25% of your tickets. Pretty wild.

I'm all for people getting booted that are abusing it, like the assholes that were asking for 20k for court side seats to the opener but it seems unnecessarily harsh to be so restrictive everywhere. I can't get to every game, not even close but want to make sure I have (at minimum) playoff tickets. The thought that I could get season tickets revoked merely for selling even 50% (let alone 25%) of my tickets around face value is crazy (I was selling tickets to games like Chicago, GSW, etc. for just $10 or so over face).

Part of that price point was because I was scared shitless that the franchise would kill my tickets and part of it was because the Cavs routinely dumped single tickets diluting the market. I have really good low loudvile seats (center court) and people would constantly offer me less than $20 for them because the Cavs were just fire saleing so many tickets at similar prices.

From my experience, there is something to be said for spreading ticket resources around, where more eyeballs see them. Average tickets prices were FAR higher the last time LeBron was here when Flashseats were an option but paper tickets and third party sellers existed. People will argue it's better for individual fans, which it probably is (lower prices) but you should be rewarding the person giving you thousands of dollars, not the ones giving you hundreds.

 

[natedagg]

The team did away with hard tickets this season. Your only option was FlashSeats . The Cavs also put language in that reserves them the right to revoke season tickets if you sell them elsewhere. Stories surfaced on here of people who had tickets revoked / suspended for selling PRE-SEASON tickets on StubHub or the like. Can't verify that but it raised some eyebrows.

There was even language that went further than that, stating if they deem you to be a "broker" that they can also suspend or terminate your account. That "broker" provision could be looked at if you sold as little as 25% of your tickets. Pretty wild.

I'm all for people getting booted that are abusing it, like the assholes that were asking for 20k for court side seats to the opener but it seems unnecessarily harsh to be so restrictive everywhere. I can't get to every game, not even close but want to make sure I have (at minimum) playoff tickets. The thought that I could get season tickets revoked merely for selling even 50% (let alone 25%) of my tickets around face value is crazy (I was selling tickets to games like Chicago, GSW, etc. for just $10 or so over face).

Part of that price point was because I was scared shitless that the franchise would kill my tickets and part of it was because the Cavs routinely dumped single tickets diluting the market. I have really good low loudvile seats (center court) and people would constantly offer me less than $20 for them because the Cavs were just fire saleing so many tickets at similar prices.

From my experience, there is something to be said for spreading ticket resources around, where more eyeballs see them. Average tickets prices were FAR higher the last time LeBron was here when Flashseats were an option but paper tickets and third party sellers existed. People will argue it's better for individual fans, which it probably is (lower prices) but you should be rewarding the person giving you thousands of dollars, not the ones giving you hundreds.

Woah, that's pretty messed up. I even think that if people want to ask $20k for courtside seats for LeBron's return, they are welcome to see if there's any takers. There shouldn't be a problem selling GSW warriors tickets for, well, for whatever someone will pay, either. Crazy that you simply recouped cost on those - that's pretty unfair.

I guess we'll see what happens with the Warriors now, but I have to say I am rooting for the lawsuit to have legs.

 

[cosmickid]

The FlashSeats system is rather unfair. The distribution of one's season tickets is off limits for the team. What is rather disgusting is that the Cavs not only control how you distribute your tickets, but they take a cut off of every transaction. Given that, who are they to say "you have sold your seats far too many times to retain your subscription?" What kind of hypocritical double-standard is that? My season seats have gone unsold and unused close to 7 or 8 times this season. I have sold my seats for well under face value on at least 10-12 occasions. The fact that the Cavs think they can control what I do with my seats while taking a cut, is pathetic. The Golden State case won't be decided for a while, but hopefully the outcome is one that obliterates the Flash Seats restrictions.

 

[cosmickid]

If nothing else, I would assume this will make financials public.

I'll be interested to see how much teams profit from all the bullshit charges they tack on. Many times FlashSeats charges you an admission tax for games you don't even go to. It's insane. Why the fuck am I charged an admission tax for a game I don't even go to? I wonder if GSW is doing the same.

My biggest gripe with teams controlling secondary markets though is how the Cavaliers were just dumping single game tickets they withheld. They were absolutely DESTROYING the secondary re-sale market for season ticket holders. I don't buy season tickets to make money, I buy them to guarantee seats to any good games and also playoff priority but my reward for giving the Cavs thousands of dollars in advance (I'm already paying for 20516 seats) is for them to make it hard for me to sell seats, many times, for face value. I ended up about breaking even on my tickets this season, which is fine but it shouldn't be that much of a struggle given the on court product.

I agree with you on all points save for the dumping of single game tickets. The Cavs sold you your season tickets as a ticket to enter the game. If you cannot attend and want to sell it, that's fine, but understand that they also have an interest in selling their unsold allotment of seats. It just so happens that those seats often become available last minute as that is when the league/opposition team informs them that they will not need them, which is unfortunate. Again, the Cavs interest is to sell every seat in the building. Even with a system like FlashSeats that gives them a cut of every sale, they would rather sell their unsold inventory than aid/facilitate the sale of already sold inventory.

 

[I'mWithDan]

I agree with you on all points save for the dumping of single game tickets. The Cavs sold you your season tickets as a ticket to enter the game. If you cannot attend and want to sell it, that's fine, but understand that they also have an interest in selling their unsold allotment of seats. It just so happens that those seats often become available last minute as that is when the league/opposition team informs them that they will not need them, which is unfortunate. Again, the Cavs interest is to sell every seat in the building. Even with a system like FlashSeats that gives them a cut of every sale, they would rather sell their unsold inventory than aid/facilitate the sale of already sold inventory.

I agree with that last part from a business perspective but we're not talking about a handful of seats, we're talking about (sometimes) a thousand of them.

Given ticket demand before and during the season, it was obvious the Cavs were intentionally withholding tickets in an effort to try to play the system. Large quantities of tickets would just flood in at random times, amounts that were way beyond anything that could be chalked up as coincidence. The lottery system for single game tickets was a nice redirection as well, as it pertained to artificially lowering prices. This shortened the time of how long tickets were in fans' hands and it also drove complacency among buyers as many would say "I'll just wait until the next lottery".

If the Cavs sold every single game ticket before the season (save the random exceptions that occur), they would have made SIGNIFICANTLY more money off of FlashSeats. It would have driven fans to buy tickets ahead of time, when prices are more advantageous to the team and sellers. The current policies encourage people to wait, which I think is a bad precedent to set when you are manipulating where tickets can be sold. I'd be fine if they continued to do that IF they gave sellers more options but when you control the secondary market completely AND encourage fans to make decisions at the last minute, that is how you create a giant black hole for anyone who wants to sell a ticket (for any reason).

 

[supermario21]

I agree with that last part from a business perspective but we're not talking about a handful of seats, we're talking about (sometimes) a thousand of them.

Given ticket demand before and during the season, it was obvious the Cavs were intentionally withholding tickets in an effort to try to play the system. Large quantities of tickets would just flood in at random times, amounts that were way beyond anything that could be chalked up as coincidence. The lottery system for single game tickets was a nice redirection as well, as it pertained to artificially lowering prices. This shortened the time of how long tickets were in fans' hands and it also drove complacency among buyers as many would say "I'll just wait until the next lottery".

If the Cavs sold every single game ticket before the season (save the random exceptions that occur), they would have made SIGNIFICANTLY more money off of FlashSeats. It would have driven fans to buy tickets ahead of time, when prices are more advantageous to the team and sellers. The current policies encourage people to wait, which I think is a bad precedent to set when you are manipulating where tickets can be sold. I'd be fine if they continued to do that IF they gave sellers more options but when you control the secondary market completely AND encourage fans to make decisions at the last minute, that is how you create a giant black hole for anyone who wants to sell a ticket (for any reason).

Totally correct. Arguably, with the exception of guaranteed playoff seats, there really is almost NO incentive to get season tickets when the Cavs are hoarding tickets to give away both via the lottery and random mass ticket releases. Just the other night I got a text telling me about tons of cheap seats for the game against the Heat. I could expect something like that against a bad team but Miami? I get that the Cavs wanted more local fans to attend the games, but it killed the market for ticket holders. It really is unfair to them considering they are the ones forking over thousands of dollars. We used to have Ohio State football season tickets throughout most of the Tressel era and you could consistently get above face value for even marginal games because they weren't just releasing tons of tickets every game. Also the 2 week LeBron vacation and the team's poor start blunted some ticket demand/value and I don't think it ever fully recovered.

 

[Hutch316]

I know personally of people that had their seats pulled....my seats are the cheap $12 seats and made some decent money this year but definitely was limited because of these pathetic business practices. luckily I plan on making it all up now that I was able to attain 7 tickets to every playoff game...was told no restrictions on sales but they have to be on flashseats which is total bullshit like it has been all year. I emailed Rovel about the cavs as well so hopefully this is exposed.

 

[Helium filament]

Given ticket demand before and during the season, it was obvious the Cavs were intentionally withholding tickets in an effort to try to play the system. Large quantities of tickets would just flood in at random times, amounts that were way beyond anything that could be chalked up as coincidence. The lottery system for single game tickets was a nice redirection as well, as it pertained to artificially lowering prices. This shortened the time of how long tickets were in fans' hands and it also drove complacency among buyers as many would say "I'll just wait until the next lottery".

If the Cavs sold every single game ticket before the season (save the random exceptions that occur), they would have made SIGNIFICANTLY more money off of FlashSeats. It would have driven fans to buy tickets ahead of time, when prices are more advantageous to the team and sellers. The current policies encourage people to wait, which I think is a bad precedent to set when you are manipulating where tickets can be sold. I'd be fine if they continued to do that IF they gave sellers more options but when you control the secondary market completely AND encourage fans to make decisions at the last minute, that is how you create a giant black hole for anyone who wants to sell a ticket (for any reason).

I think the single ticket lottery was a total fail. I won the lottery several times, and they inflated the prices so much that it wasn't worth buying them. For random games (not big name games), the prices of the top row in the 200 levels behind the basket was $36+. I never purchased them on there as a result, because I knew I could buy them for cheaper on flash seats. My problem with flash seats is the fees. I have both sold and purchased tickets, and both ways I got screwed with the fees. It's really hard to break even selling them, and when you buy them you are essentially paying for an extra ticket in fees.

 

[Redzone]

I think the single ticket lottery was a total fail. I won the lottery several times, and they inflated the prices so much that it wasn't worth buying them. For random games (not big name games), the prices of the top row in the 200 levels behind the basket was $36+. I never purchased them on there as a result, because I knew I could buy them for cheaper on flash seats. My problem with flash seats is the fees. I have both sold and purchased tickets, and both ways I got screwed with the fees. It's really hard to break even selling them, and when you buy them you are essentially paying for an extra ticket in fees.

It's the fees that are one of the main issues in the StubHub case and why Cavs fans should pay attention (I believe prices of tickets might also fall if more than one forum were available, which would hurt sellers). I love the convenience, speed and certainty of authentic tickets of flash seats, but no one likes the fees which, for the first time, included fees charged to the seller. Open competition would arguably lower the fees if consumers have other options to shop/sell.

I do wonder if the Cavs will bring back the lottery for next year. Fortunately, the Cavs are allowing at least long-time season ticketholders to obtain up to four extra tickets to each playoff game, which was a far cry from the limit of only six extra tickets for regular season games that season ticketholders were allowed before this season began--and my experience was that these were poor locations in the upper corners. Perhaps the recent increase in price for next year has deterred some ticketholders from renewing and maybe the Cavs have since relaxed some of their prior policies.

 

[The Human Q-Tip]

Do the Cavs make a profit off FlashSeats?

I'm asking because the supposed harm of this policy is that it keeps the price of resale tickets lower. That isn't great for those who want to sell tickets, but it is a huge plus for the public at large who may wish to buy a ticket.

So the Cavs argument against the claim would be that they are not seeking monopoly profits, but rather simply trying to ensure that the public isn't overcharged for resale tickets.

Of course, if FlashSeats is a moneymaker for them, that particular argument wouldn't work.