StubHub sued over new no-refund policy

Secondary ticketing giant StubHub has become the first ticket seller to face legal action as a result of a refund policy that offers credit vouchers in lieu of cash.

Ticket vouchers have become a popular refund mechanism for cancelled shows during the ongoing coronavirus crisis, with a growing number of governments backing industry associations’ calls for their members to be able to temporarily hold onto customers’ funds. Vincenzo Spera, president of Italian promoters’ association Assomusica, last week described a government-backed voucher scheme in Italy as a “lifesaver” for the struggling concert business.

StubHub similarly recently moved to a voucher-only model in North America, amid speculation the US ticket resale site, which is in the process of being acquired by Viagogo, is struggling financially.

Now, a class-action lawsuit filed in Wisconsin on Friday (3 April) afternoon accuses StubHub of violating its own consumer protection promise with the move, with plaintiff Matthew McMillan saying the company is “retroactively” backing out of its “longstanding ‘FanProtect’ guarantee […] in response to apparent liabilities it would incur stemming from the Covid-19 pandemic.”

“Instead of instituting responsible financial transaction policies, StubHub made it their practice to pay ticket sellers before the event had occurred

According to Law360, McMillan’s suit alleges StubHub brought on its financial crisis itself through its own policy of paying ticket resellers (touts/brokers) before the event has occurred, despite the “entirely foreseeable scenario that world occurrences would cause the simultaneous cancellation of numerous public events.”

“Instead of instituting responsible financial transaction policies, defendants [StubHub] made it their practice to pay ticket sellers before the event had occurred,” the complaint reads, “exposing themselves to the possibility that they would be left holding the bag (or have to ignore their own guarantee and cheat their customers) if an event was canceled and they could not promptly collect from sellers.”

In a statement, McMillan’s lawyer, Nicholas Coulson of Liddle & Dubin, says: “Dumping promised refunds for expiring coupons during the time of greatest financial suffering in recent history is cruel and wrong, especially because people have no idea if they’ll even be able to use the coupons. We don’t know what the next 12 months are going to look like.

“Through this action, we hope to provide people some small bit of relief during this uncertain time.”

As of 25 March, StubHub is offering fans with tickets for cancelled events with a coupon valued at 120% of their original purchase.

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