SBJ/June 4-10, 2012/In Depth

Battleground states

Highlights of legislation proposed for regulating the ticket market

FLORIDA
Current law: Scalping legal since 2006; allows ticket purchase limits. In June 2009, passed a law that requires sellers to refund tickets when buyers are denied admission or events are canceled. The law also bans the use of “robot” software, which surfs for and secures tickets online.
The bill: S 392; H 225. Would prohibit teams, venues and promoters from making buyers agree not to resell or forcing them to resell through specific channels. Would prohibit the use of technology — typically paperless ticketing — to limit resale. “Original” sellers would have to disclose the number of tickets issued and the number of those available to the general public, broken down by class, tier or level of admission.
The sponsors: Sen. Ellyn Setnor Bogdanoff (R-Fort Lauderdale), Rep. Matt Gaetz (R-Fort Walton Beach).
The money: StubHub parent eBay spent $30,000 to $40,000 lobbying Florida legislators through one firm, and less than $10,000 with a second firm, in the first quarter of 2012. Ticketmaster parent Live Nation spent $10,000 to $20,000 in the quarter in Florida, as did ticket broker group Ticket Network.
Status: Filed in September; died in Senate committee and House subcommittee in March.

MASSACHUSETTS
Current law: Limits resale price to $2 over face, plus service charges, making Massachusetts one of only five states that purports to regulate price. Sellers, and even registered brokers, routinely price tickets far higher, contending that the markup covers operational costs.
The bill: HB 1893 would eliminate the already ignored prohibitions on pricing. It includes transparency provisions, requiring issuers to reveal the number of tickets at various price levels and disclose how many are available to the general public. It would guarantee the right to resell without price maximums or minimums on the channel of choice, and would specifically prohibit the requirement of a credit card for paperless admission. Would allow the sale of up to 80 tickets without registering as a broker.
The sponsor: Rep. Michael Moran (D-Brighton)
The money: EBay spent $48,000 in 2011 with lobbyist John Murphy Jr. and his firm, Issues Management Group, and $24,000 with Hub Strategies. The latter reported $3,525 in expenses tied to travel for StubHub government relations head Dusty Brighton and CEO Chris Tsakalakis, who attended hearings on the legislation in September. Boston-based broker Ace Tickets spent $24,000 with Newgrange Consulting Group; Live Nation spent $6,000 each with Thomas Cremin and Capitol Consulting; and Veritix spent $6,000 with Shanley Fleming Boksanski & Cahill.
Status: Hearings in September generated press, but the bill hasn’t moved.

MINNESOTA
Current law: Repealed 94-year-old anti-scalping law in 2007.
The bill: SF 425; HF 657. Anti-paperless bill would make it illegal for a ticket issuer to prohibit or restrict the resale of a ticket or limit the channels through which it could be resold, or set maximum or minimum resale prices. Specifically, it would prohibit paperless sales that require a ticket-holder to present a credit card to gain admission.
The sponsors: Sen. Chris Gerlach (R-Apple Valley); Rep. Joe Hoppe (R-Chaska).
The money: Minnesota disclosures reveal only whether a lobbyist was paid more than $500 during a six-month period, so it’s difficult to gauge quantity. But on the quality front, it’s clear both sides made this bill a priority. EBay hired highly regarded Minnesota lobbyist Ted Grindal and Live Nation went with well-connected Rich Forschler, who worked the state’s legislative halls on behalf of most of the Twin Cities teams as they secured public support for new stadiums and arenas. Ticket Network and Ticket King of Minnesota also lobbied in support of the bill. The expense filings on eBay’s side included $5,381 in the first half of the year and $4,469 in the second half, tied mostly to travel and lodging. Live Nation showed no expenses, likely because they used mostly local voices — the team executives — to make their point.
Status: House bill passed 83-50 in March; Senate adjourned without voting.

NEW JERSEY
Current law: Scalping allowed, but closely regulated. Registered brokers and season-ticket holders may resell at up to 50 percent over face value; other sellers are capped at 20 percent over face. Registered brokers must maintain an office in the state, disclose refund policies and disclose when listed tickets are not yet secured. Original sellers can’t hold back more than 5 percent of the ticket inventory.
The bill: S 875; A 2258. Would restructure ticket sale and resale laws, and eliminate price caps. It would include transparency provisions that require ticket issuers to reveal the number of tickets to be issued, number to be offered to the general public, and holdbacks. It would prohibit paperless tickets in forms not readily transferable and prohibit requirements of documentation, such as the presentation of the credit card used for purchase. It would prohibit original sellers from imposing terms or penalties that restrict resale. It would ban “insider” sales between issuers and their affiliates, eliminate registration for brokers, and outlaw robotic software and other techniques that allow buyers to exceed purchase limits.
The sponsors: Sens. Raymond Lesniak (D-Union) and Robert Singer (R-Jackson); Assemblyman Vincent Prieto (D-Secaucus).
The money: EBay spent $72,000 with lobbyists from Katz Government Affairs in 2011. Live Nation spent $48,000 with Capital Public Affairs. EBay also contributed $500 to the campaign of Lesniak, the co-sponsor of the bill, and $1,000 to Sen. Nia Gill, the chair of the commerce committee, where the bill sits.
Status: Duplicate bills are in committee.

TENNESSEE
Current law: Scalping legal since 1989.
The bill: SB 585. Known as the Fairness in Ticketing Act, it is the only state bill put in play thus far this year that has Ticketmaster and team support, and eBay opposition. It purports to take aim at large-scale brokers, proposing to make it illegal to buy or resell more than 25 tickets to one event. Tickets would have to be resold at face value or less — unless they were resold “under the supervision of the place of public entertainment,” seemingly carving out the resale market for the initial issuers.
The sponsor: Rep. Ryan Haynes (R-Knoxville).
The money: EBay spent $25,000 to $50,000 with lobbyist Tony Thompson Jr., according to a February filing; Live Nation spent $10,000 to $25,000 with lobbyist Tom Lee.
Status: Stalled late in March when it was kicked back to a Senate committee study group for further examination.

Note: Based on lobbyist and campaign finance documents filed at the state and federal levels.


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