A group of ticket resale platforms sued D.C. on Wednesday to prevent a law that will cap the sale price of secondhand tickets from going into effect in January.
The D.C. Council passed the Restricting Egregious Scalping Against Live Entertainment (RESALE) Amendment Act in July, capping the price of resold tickets at 10% more than their original value. Ticket Policy Forum, alongside ticketing companies including SeatGeek and Vivid Seats, filed the lawsuit in U.S. District Court in D.C., arguing the law would upend the secondhand market by significantly restricting the costs companies are able to recover in facilitating resale transactions.
The lawsuit alleged the RESALE Act violates the companies’ First Amendment rights by requiring them to publish the original price of tickets listed for resale on their sites. The filing said there is “no evidence that displaying the original price helps buyers understand what they are purchasing,” and that the council “never considered alternatives that would burden less speech.”
The complaint also said the council is overstepping its jurisdiction by attempting to regulate commerce outside of the District. About 85% to 90% of the resellers’ transactions for non-sports D.C. events in the last year were between sellers and buyers both located outside the District, the lawsuit says.
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Secondhand marketplaces let customers buy tickets quickly and easily, “but those benefits are lost when governments impose price controls that do not reflect true costs and economic realities,” the lawsuit said. “Such arbitrary price caps inevitably lead to less competition, less choice, less supply, and more black-market activity.”
Ward 6 council member Charles Allen, who introduced the legislation, told The Washington Sun he isn’t surprised by the lawsuit and that resale companies have run a “scam” for years, scooping up as many tickets as possible to resell at inflated prices. The law will let fans “finally catch a break on the outrageous price mark-ups,” he said.
The law gained support of local arts venues such as 9:30 Club and The Anthem, with proponents arguing that resellers on secondhand marketplace websites have hurt independent venues.
Audrey Fix Schaefer, the communications director for I.M.P., which owns D.C. venues including the 9:30 Club and The Anthem, said the lawsuit is a “desperate attempt” by ticket resale companies to continue to “gouge and siphon” money out of the District by subverting consumer protection laws.
Fix Schaefer said local venues are tired of seeing their customers abused by “parasitic ticket scalpers” selling tickets for far above face value.
Arts venues aren’t the only businesses affected by high prices, she said. If customers can’t afford to see a show, that means fewer people are spending money at nearby establishments before and after the event.
Critics argue the law gives too much power to the primary ticket markets and could drive the resale market underground, making it less regulated.
The law would require the resale websites to sell tickets at a loss for the companies — or blacklist D.C. events, the Ticket Policy Forum said in a statement. It could also push ticket sales to less-regulated avenues, such as on-the-street sellers or social media, increasing the risk of fraud, the statement said.
“Fans need to know this law won’t deliver the relief it promises,” Brian Berry, the executive director of the Ticket Policy Forum, told The Sun. “It was backed by Ticketmaster, and it exempts Ticketmaster’s own dynamic pricing at concert venues, so prices will keep climbing. Worse, by pushing legitimate sellers off regulated marketplaces, it sends fans toward social media, where scams thrive.”
In April, Ticketmaster’s parent company was ordered to pay nearly $10 million to D.C. residents for “deceptive ticketing practices.”
The D.C. attorney general’s office did not immediately respond to a request for comment.
This story has been updated to include statements from D.C. Council member Charles Allen and representatives for I.M.P. and the Ticket Policy Forum.
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