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Missouri Scalping Crackdown Gets Results

Online scalpers buy out entire concerts in some cases

By Lisa Wade McCormick
ConsumerAffairs.com

October 22, 2007

That’s the case with a Missouri woman who tried again on Saturday to get tickets to Hannah Montana’s upcoming concert in Kansas City for her eight-year-old daughter.

“I got them!” an excited Claire N. screamed over the phone seconds after the tickets went on sale.

Claire and other Hannah Montana fans in Kansas City had another chance to buy the much-coveted tickets on Saturday thanks to an agreement Missouri Attorney General Jay Nixon reached earlier this month with Ticketmaster.

Under that agreement, Ticketmaster released an additional 1,000 tickets -- held by artist’s promotion company -- to the teen idol’s December 3 concert in Kansas City.

Claire went online Saturday morning and managed to snatch up two of those hot tickets.

“I’m ecstatic,” she said after buying the tickets for face value -- $56 a piece. “I’m going to give them to my daughter on Thanksgiving as an early Christmas presents.”

Claire had tried in September to buy Hannah Montana tickets -- at the designated time of sale -- but discovered the show was already sold out.

She and other Missouri fans, however, immediately found scores of Hannah Montana tickets at various brokers – but at greatly inflated prices. Some tickets to the pop diva’s concerts in Missouri -- that included an October 18 show in St. Louis -- sold for up to 20 times the face value.

State sues scalpers

Earlier this month, Nixon sued three ticket brokers for allegedly scalping Hannah Montana tickets: GoTickets Inc. and Tickets Now Entertainment Group Inc., both of Springfield, Illinois, and Ticket Solutions Inc. of Overland Park, Kansas.

Investigators from Nixon’s office purchased tickets from these online brokers to the pop star’s upcoming Kansas City concert. They paid $254, $257, and $305 for tickets that had a face value of either $26 or $56.

Nixon’s lawsuits, filed in the Jackson County, Missouri, Circuit Court, alleged the brokers violated the state’s consumer protection laws by scalping tickets. The sale of tickets at prices far above the face values is a violation of a Kansas City municipal ordinance that prohibits scalping.

“These companies are able to employ inappropriate means, using sophisticated software, to hoard all the tickets to high-demand events and then turn around and sell them at grossly inflated prices,” Nixon said when he sued the brokers. “It’s a blatant rip-off of consumers who attempt to purchase tickets in good faith through the proper means and are met with nothing but frustration.”

At the same time Nixon took those ticket brokers to court, he also reached the agreement with Ticketmaster to sell additional tickets to the young pop star’s shows in St. Louis and Kansas City.

Under the agreement, fans could only purchase two tickets to the concerts through Ticketmaster’s Web site or over the phone.

To prevent scalping, fans must pick up their tickets at the venue’s box office -- on the day of the concert -- and present photo identification and the credit card they used for payment.

“By requiring purchasers to appear at the box office and provide credit card and photo ID verification, we also are minimizing the impact that would-be scalpers will have on these sales,” Nixon said. “If these ticket brokers are rendered unable to hijack the system, real fans get the tickets at the prices set by the artists.”

Nixon said he worked out this agreement to ensure fans had a chance to get Hannah Montana tickets – at a fair price. “We wanted to make sure that a lot of frustrated moms and dads, with their disappointed kids, had the opportunity to purchase tickets to these concerts at face value.”

Claire appreciates Nixon’s action.

“My daughter really wanted to go this show and she was upset when we couldn’t get tickets. I’m so happy that I got these…I’m ecstatic.

“We beat the ticket scalpers,” she added.

No callbacks

ConsumerAffairs.com tried to contact the ticket brokers named in Nixon’s lawsuit, but none returned our calls.

Meanwhile, consumers nationwide have shared horror stories with us about ticket scalpers gobbling up all the Hannah Montana tickets and selling them at inflated prices.

“I was on TicketMaster 20 minutes before the Hannah Montana tickets went on sale at 10:00a.m.,” one parent from Nottingham, Maryland, wrote us. “They were sold out at 10:01! My friends were also on the Web site at the same time and had problems.

“Ten minutes later, the tickets were on eBay selling for triple the price. I am very upset that they allow people to sell these tickets online to make money, and my daughter, who is a true fan, can't go because I can't afford to spend $300 per ticket.”

Missouri isn’t the only state cracking down on brokers that allegedly scalp Hannah Montana’s concert tickets.

The Arkansas attorney general recently launched an investigation into the sale of these tickets to determine if some online brokers violated that state’s scalping laws.

“I have a young daughter, and I really wish I could fix this problem for all the parents with disappointed kids right now,” Attorney General Dustin McDaniel said. “However, what our investigation reveals thus far is that many of the tickets intended to be sold directly to Arkansas consumers were diverted to as yet unidentified bulk purchasers.”

McDaniel said he learned of allegations that at least one company is selling a software product that allows users to breach Ticketmaster’s online system. Users who have this software, he said, can “cut in line” ahead of legitimate customers and block access to tickets at the site.

Sales at the box office are also tied into the Ticketmaster system, McDaniel said, and it’s possible that users of this software were able to block the full number of tickets intended to be available at the box office.

McDaniel also warned consumers that some tickets offered for sale on the Internet could be bogus. Some online ticket sellers might not have the tickets they’re selling, he cautioned, while other might sell counterfeit tickets.

What to do

McDaniel offered the following tips to consumers buying tickets online:

• Know the company you’re dealing with. Web sites have certain guidelines that resellers must follow, but not all sites verify ticket authenticity before permitting users to post them for sale;

• Avoid paying the seller directly with cash or a check. Many auction sites use separate services to handle the payment, which usually requires the use of a credit card. If purchases are made through a separate service or with a credit card, the consumer is more likely to have some recourse to dispute the charge if the tickets turn out to be bogus;

• Research the seller and the Web site. Web sites that display the Better Business Bureau seal usually have a buyer protection program. Consumers should also find out if the seller has a history of satisfied customers.

“While there will always be issues relating to ticket availability where demand exceeds supply, the process must be fair to consumers,” Attorney General McDaniel said. “With these ticket sales, there is the additional problem that many are being offered on the Internet at prices far above the face value.

"In many instances, Arkansas law prohibits resale at prices over the face value plus a reasonable handling charge.”

McDaniel, however, said it’s sometimes difficult to enforce ticket scalping laws with Internet transactions because the sellers may be in another state or country.

Unfortunately, consumers in Kansas City, Missouri, will soon have zero protection against ticket scalping.

It’s currently illegal to sell tickets above face value in that city. But the Missouri Legislature recently passed a measure that legalized ticket scalping in the state—effective November 28.

Some legislators have said they may try to overturn that law in the next session, which convenes in January.

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