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Thursday, May 11, 2017

State settles with ticket-bot companies

All WNY News     Thursday, May 11, 2017    

STAFF REPORTS



NEW YORK -- New York State settled wth six ticket brokers that illegally purchased and resold hundreds of thousands of tickets in New York State since 2011, including on popular ticket resale platforms like StubHub and Vivid Seats.

Five of the companies – Renaissance Ventures, LLC (d/b/a Prestige Entertainment) of Connecticut, Ebrani Corp (d/b/a Presidential Tickets) of New York, Concert Specials, Inc. of New York, Fanfetch Inc. of New York and BMC Capital Partners, Inc. of New York – violated New York's ticket laws by using illegal software (known as ticket "bots") to purchase large numbers of tickets on websites such as Ticketmaster.com before the tickets could be obtained by consumers. After obtaining the tickets illegally, resellers then resold them at a large profit to New York consumers, among others. Five of the companies – Prestige Entertainment, Presidential Tickets, Concert Specials, Fanfetch and JAL Enterprises, LLC (d/b/a Top Star Tickets) of Massachusetts – each illegally sold tickets to events in New York over the last several years without first obtaining the required license.

The settlements require that the companies and their principals maintain proper ticket reseller licenses if they wish to resell tickets to New York events, abstain from using bots, and pay penalties for having operated illegally. The settlements require the six companies to pay a combined total of $4.19 million in disgorged profits and penalties to the State.

The Attorney General also announced a settlement with a seventh company, Componica, LLC of Iowa, that developed software libraries used by ticket bots to try to get around tests that websites use to determine if a user is a human or a bot (often referred to as "CAPTCHA" tests).  Componica has agreed to not develop or use software to bypass security measures on ticketing websites.

"Unscrupulous ticket resellers who break the rules and take advantage of ordinary consumers are one of the major reasons why ticketing remains a rigged system," said Attorney General Eric Schneiderman. "We will continue to fight to make ticketing a more fair and transparent marketplace, so fans have the opportunity to enjoy their favorite shows and events. Anybody who breaks the law will pay a steep price."

Attorney General Schneiderman's investigation found that Prestige Entertainment ran one of the largest ticket purchasing and reselling operations in the United States. Prestige Entertainment used at least two different bots and thousands of credit cards and Ticketmaster accounts to purchase tickets to New York shows. Prestige Entertainment also bought IP addresses from online IP proxy services to evade detection of its bots by retail ticket marketplaces such as Ticketmaster.com.  Prestige Entertainment used all of its illegal advantages to great effect, purchasing huge quantities of tickets to popular shows. For example, Prestige Entertainment purchased 1,012 tickets to a 2014 U2 Concert at Madison Square Garden in 1 minute.  

Prestige Entertainment paid $3,350,000, Concert Specials paid $480,000, Presidential Tickets paid $125,000, BMC Capital paid $95,000, Top Star Tickets paid $85,000, and Fanfetch paid $55,000.
Since releasing its report on the concert and sports ticket industry titled Obstructed View: What's Blocking New Yorkers From Getting Tickets in January 2016, the Attorney General's office has now announced settlements with 15 businesses involved in the illegal ticket trade, including resellers, facilitators, and software developers, for a total of $7.1 million. The office's broader investigation into the secondary ticketing industry remains ongoing.

In 2016, New York enacted legislation called for by Attorney General Schneiderman that added criminal penalties for bot use to the existing civil penalties.  That law took effect in February 2017.  The settlements announced to date involved misconduct committed before the new law took effect.
These cases were handled by Bureau of Internet and Technology (BIT) Assistant Attorneys General Aaron Chase, Jordan Adler, and Noah Stein, and BIT Bureau Chief Kathleen McGee.  The Executive Deputy Attorney General for Economic Justice is Manisha Sheth.

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