A New Jersey Superior Court judge recently dismissed a case filed by the state’s former Attorney General over the alleged sale of “phantom” Bruce...

A New Jersey Superior Court judge recently dismissed a case filed by the state’s former Attorney General over the alleged sale of “phantom” Bruce Springsteen tickets in 2009.

TicketNetwork and Orbitz Worldwide’s Cheaptickets.com were accused of allegedly trying to sell Bruce Springsteen tickets before they were available to the public, and in some instances the tickets allegedly being sold were to seats that did not exist in the old Giants Stadium where the concerts were to take place last fall. TicketNetwork has a secondary ticket resale partnership with Cheaptickets.com.

When the lawsuit was filed in the spring of 2009, former New Jersey Attorney General Anne Milgram called it a case of fraud. “Advertising and selling tickets before they are made available for initial purchase by the public is an outrageous practice. It is fraud to offer to sell a product that one does not possess, and may never possess, and I am committed to ending this deceptive practice.”

Superior Court Judge Patricia Costello saw it differently, however, and ruled that the companies were protected under the federal Communications Decency Act (CDA), in part because neither TicketNetwork nor Cheaptickets.com were actually selling the tickets themselves. In both instances, the companies provided marketplaces used by other entities to sell the tickets. In an unrelated case in Illinois, StubHub beat the City of Chicago using issues raised under the CDA to win that case.

“The totality of the record establishes that defendants were not responsible, in whole or in part, for the creation or development of the alleged inaccurate or misleading ticket listings,” Costello’s decision states. The decision was handed down late last week, but the parties did not learn of it until Tuesday, August 31. “This information originated, not from defendants, but from another information content provider, namely the third-party sellers using defendants’ websites. As a provider of an interactive computer service that served as a conduit for information provided by another information content provider, defendants are afforded the broad immunity under the CDA. There was no material, substantive contribution to the ticket listings by the defendants. Simply put, defendants’ actions do not constitute ‘development, in whole or in part’ within the meaning of [Section 230 of the CDA]. Defendants’ conduct does not transform them into ‘information content providers’ under the CDA.”

Section 230 of the Communications Decency Act essentially protects internet service providers and users from legal action against them based on the activity of others. Both TicketNetwork and Cheaptickets.com argued that they notify customers that ticket information is not guaranteed, and that TicketNetwork’s reseller guidelines prohibit sales of tickets reseller does not have in their possession.

“The opinion is under review, and we have no comment at this time,” Lee Moore, spokesperson for current New Jersey Attorney General Paula Dow, told TicketNews. Dow was appointed Attorney General by Gov. Chris Christie, who was elected after the case was filed.

Costello also wrote, “Defendants’ services help to create and maintain a vibrant, competitive, market for consumers looking to purchase travel and entertainment related products and services online. As a result, defendants’ services are consistent with the Congress’s intent to encourage commerce over the Internet and ensure interactive computer services are not held responsible for how third parties use their services.”

New Jersey attorney Peter Harvey, who represented TicketNetwork, told the Philadelphia Inquirer that the decision sets a precedent in the Garden State. “This is a very important decision that has never been presented to courts in New Jersey before. The question was, if a ticket seller makes a mistake in the description of the item being sold, does the provider have liability for that, and the answer is no.”

In addition to TicketNetwork and Cheaptickets.com, other secondary ticket companies were also sued by the Attorney General’s Office, namely Almost Backstage Inc. of Vauxhall, Ticket Town, Inc. of Fort Lee and Riverdale, NJ-based Select-A-Ticket.

A few months after the lawsuits were filed, Milgram settled with Almost Backstage and Ticket Town, convincing the two to each pay a $5,000 fine and promise not to try to sell tickets they do not have in-hand or prior to public onsale dates.

Despite the ruling in favor of TicketNetwork and Orbitz, the similar case against Select-A-Ticket is still pending. Owner Tom Patania declined to comment.

“This decision will allow consumers in New Jersey and nationwide to have a greater selection of tickets to events,” Don Vaccaro, founder and CEO of TicketNetwork, said in a statement.

“This lawsuit exposed the fact that tickets become scarce due to artists holding a significant amount of tickets in reserve instead of releasing every single ticket to the public. These tickets are often available to purchase prior to the official on-sale date. The secondary ticket market and ticket brokers are not to blame for tickets that are sold out in minutes, but rather they provide an alternative outlet for purchasing these pre on-sale tickets that are normally unavailable to the general public. TicketNetwork has always put consumers first and we will continue to do so in the future,” Vaccaro added.

TicketNetwork is the parent company of TicketNews.

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By Alfred Branch Jr.

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