A recent Massachusetts Supreme Court ruling in a lawsuit involving the resale of Boston Red Sox tickets by Weymouth, MA-based Admit One Ticket Agency, LLC (AOTA) could help break the logjam over repealing the state’s anti-scalping laws.
Late last week, the state Supreme Court upheld an earlier Appellate Court ruling that determined that consumer advocate Colman Herman was essentially not harmed by AOTA charging $500 each for Yankees-Red Sox tickets that were selling at a face value of $85 because Herman had not actually bought a ticket. A lower court had ruled in Herman’s favor, but only awarded him damages of $25 in the case, but the Appellate Court overturned it. In addition, Herman considered buying tickets for a Red Sox-Orioles game for $165 each; the face value for those tickets was also $85 a piece.
In the ruling, the state Supreme Court outlined much of AOTA’s business practices, for which it found no fault:
“Admit One obtains Red Sox tickets by purchasing blocks of season tickets before the season begins, and prices those tickets according to market demand throughout the season. It does not base its ticket prices on the costs of acquiring and selling a particular ticket. The price of a ticket varies depending on the opponent, whether the Red Sox are on a winning or losing streak, how many days away the game is, the weather, and the availability of discounted airfare and accommodations. Under this business model, Admit One may command a price significantly higher than the face value of a ticket for highly sought-after tickets; for less desirable games, Admit One may sell the tickets for face value or below face value,” the court ruling stated.
“Because Admit One determines ticket prices according to demand, its acquisition and operational costs are not allocated evenly among tickets. For example, in 2005, Admit One’s sales totaled approximately $1,780,000. Its overhead expenses were $911,000, while the cost of acquiring tickets was about $875,000.”
AOTA owner Gary Neyshtadt and Herman could not be reached for comment.
While Herman tried to buy tickets from the company, he said he was only willing to pay face value so the sale never occurred. In his lawsuit and testimony, he never said what he would be willing to pay for the ticket if not face value.
Technically, ticket resale is prohibited in Massachusetts, and while politicians have tried to have the law repealed, it has remained on the books in part due to a scandal involving the former Speaker of the House Salvatore DiMasi and his lobbyist friend Richard Vitale. Vitale had been hired to lobby on behalf of ticket brokers to get the law repealed but was not registered to do so, and may have exerted undue influence with DiMasi’s helps to have the law repealed.
The way the law is written, however, leaves enough wiggle room for the likes of AOTA and Ace Ticket to resell tickets because the amount of reasonable service fees associated with each sale is not clearly defined.
“In this case, however, the ability of a prospective purchaser to show that he or she is ready, willing, and able to purchase a ticket at a price consistent with [the law] is made difficult by the fact that the statute allows ticket resellers to impose certain fees in addition to the face value of a ticket. While the statute specifies the types of fees a ticket reseller may assess, it does not impose readily ascertainable restrictions on those fees, such as dollar or percentage limits. The statute permits ticket resellers to recoup ‘service charges.’ Service charges, which may not relate to the ‘general business operation’ of a licensed ticket reseller, ‘include, but are not limited to, charges for messengers, postage, and long distance telephone calls, extensions of credit and costs attributable thereto,'” the ruling stated.
Jim Holzman, owner of Ace Ticket, told TicketNews that the ruling is “great news” for ticket brokers, and it could lead to the state revisiting the repeal of the anti-scalping laws.
“I’m thrilled with the outcome of this case,” Holzman said. “This was a 6-1 ruling by the state Supreme Court, which overwhelmingly makes the case that the 1924 statue is not applicable in today’s world.”
