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DC attorney general Brian L. Schwalb has filed a lawsuit accusing the American resale platform of breaching consumer protection laws
By James Hanley on 01 Aug 2024
Eric Baker
The attorney general for the District of Columbia (DC) in the US has filed a lawsuit against StubHub, accusing the resale platform of “deceptive” pricing and hidden fees.
Brian L. Schwalb alleges the American ticket exchange and resale platform hides mandatory fees from customers until the end of a lengthy purchase process, and then fails to provide clear and accurate information about the purpose of those fees or how they are calculated.
Furthermore, he claims the “deceptive and unfair practices” interfere with consumers’ ability to comparison shop and “otherwise make informed decisions about their ticket purchases”, in violation of the District’s consumer protection laws.
“For years, StubHub has illegally deceived District consumers through its convoluted junk fee scheme,” says Schwalb. “StubHub lures consumers in by advertising a deceptively low price, forces them through a burdensome purchase process, and then finally reveals a total on the checkout page that is vastly higher than the originally advertised ticket price.
“This is no accident – StubHub intentionally hides the true price to boost profits at its customers’ expense. The District is home to one of the nation’s largest and most vibrant live entertainment scenes, and StubHub’s predatory tactics disproportionately harm District residents. That is why we’re suing to end StubHub’s exploitative pricing scheme.”
“We are disappointed that the DC Attorney General is targeting StubHub when our user experience is consistent with the law”
StubHub released a statement in response, saying it was “disappointed” at being targeted by the attorney general, and declared its support for all-in pricing.
“StubHub is committed to creating a transparent, secure, and competitive marketplace to benefit consumers,” it says. “We are disappointed that the DC attorney general is targeting StubHub when our user experience is consistent with the law, our competitors’ practices, and the broader e-commerce sector. We strongly support federal and state solutions that enhance existing laws to empower consumers, such as requiring all-in pricing uniformly across platforms.”
It was recently reported that StubHub had delayed its plans for a summer IPO. Previously, it was indicated it was planning to go public this summer if it was able to achieve a valuation of around US$16.5 billion (€15.1bn).
Viagogo announced its acquisition of StubHub for US$4.05bn in 2019 in a landmark deal that brought together the world’s two largest secondary ticket sellers, and placed Viagogo founder and CEO Eric Baker back in control of the company he co-founded in 2000.
The sale was approved by the UK Competition and Markets Authority (CMA) after Viagogo was forced to sell its international business due to competition concerns. It offloaded its StubHub business outside of North America to investment firm Digital Fuel Capital LLC for an undisclosed sum in 2021.
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