US secondary ticketing company TicketNetwork has hit back at a lawsuit issued against it by New York’s Attorney General Barbara Underwood, claiming that it is immune from being sued under the terms of a law governing the telecommunications industry.
In September, Underwood commenced action against TicketNetwork over alleged involvement in speculative ticketing listings. This practice involves a broker listing a ticket which it currently doesn’t hold, often at significantly inflated prices, in the hope that it is then bought by a customer. Only then will the broker then attempt to source the ticket at a cheaper price.
It is claimed that in the instances that a broker cannot source the ticket, or do so at a reasonable price to its business, the sale to the customer is abandoned. Underwood has claimed the practice is prevalent at TicketNetwork and has personally named its chief executive, Don Vaccaro, in the lawsuit.
Underwood is seeking to hold Vacarro personally liable for the conduct of TicketNetwork and other companies like TicketGalaxy. Underwood is suing for repeated and fraudulent business conduct, deceptive business practices, false advertising and three counts of violating current business law.
However, the Amplify website has reported that lawyers for Vaccaro claim TicketNetwork is immune from the suit due to a law which generally protects tech companies from third-party behaviour that occurs on their platform.
Vaccaro is claiming that TicketNetwork is protected under Section 230 of the Communications Decency Act of 1996. Lawyers for TicketNetwork say they were already granted immunity by a New Jersey Superior Court “from claims essentially identical to the NYAG’s claims here,” according to attorney Peter Harvey.
Underwood estimates that consumers in New York paid more than $37m (£28.7m/€32.5m) for tickets sold through TicketNetwork’s speculative programs, adding that consumers outside of the state paid more than $54m for tickets sold by New York-based brokers.
Vaccaro’s lawyers are seeking a motion to dismiss the suit, with a hearing scheduled for later this month. Harvey added: “To subject TicketNetwork and Mr. Vaccaro to costly and disruptive discovery before the Court even considers their motions to dismiss would be not only a waste of time and resources, but also an affirmative violation of TicketNetwork’s and Mr. Vaccaro’s rights under federal law.
“Respectfully, discovery should be stayed until the Court decides TicketNetwork’s and Mr. Vaccaro’s motions to dismiss.”