TicketNetwork, Ticket Galaxy Announce Settlement With NYAG

TicketNetwork and Ticket Galaxy have both settled parallel litigation with the New York Attorney General over the practice of “speculative” ticket resale, according to releases issued Wednesday afternoon.

The Connecticut-based online marketplace and ticket reseller, respectively, did not admit to any liability in the settlement, but will update disclosures on their systems to better inform consumers regarding the tickets listed for upcoming events that conform to updates within the New York law that came into effect in December.

“TicketNetwork is pleased that this matter has been resolved,” said CEO Don Vaccaro in a statement. “Our company has now achieved the clarity and certainty that we initially sought through our lawsuit against the NYAG. TicketNetwork will continue to move forward as a leader in the ticket resale industry, providing customers with a safe, secure, and cost-efficient way to purchase tickets for live events. TicketNetwork continues to represent the gold standard in customer service in this industry for our many repeat customers.”

After a lengthy inquiry launched by now-disgraced former NYAG Eric Schneiderman over three years ago, TicketNetwork filed a lawsuit in September 2018 seeking a declaratory judgement from the Supreme Court of the State of New York that its ticket sales operations were in full compliance with the law. Ticket Galaxy filed a similar lawsuit the same day. Then-NYAG Barbara Underwood’s office filed a civil lawsuit against both companies the following week.

The core of the dispute was over the practice of selling tickets for an event which the seller has not yet acquired, commonly referred to as “speculative” ticket resale. Once a sale was made, the seller would acquire the tickets and deliver them to the consumer. TicketNetwork and Ticket Galaxy likened such practices to drop-shipping sales, a common order procurement and fulfillment practice utilized by many industries. Both companies argued that there was no legal merit to the asserted basis of the NYAG’s investigation into how either operated, particularly in light of the recently enacted legislation.

“We maintained throughout the NYAG’s nearly two-year investigation that Ticket Galaxy operates honestly and in compliance of the law,” said CEO Sean Morse in a statement. “We are pleased that this matter has been resolved and we now have certainty regarding our ability to continue offering our customers the tickets they want.”

In addition to updating the disclosures on tickets within their respective systems, the companies agreed to pay $1.55 million for the time and costs of the lengthy investigation.