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Massachusetts Court Throws Out Ticket Resale Suit

State anti-scalping law dates to 1924

By Jon Hood
ConsumerAffairs.com

September 1, 2009

The state law cited in Herman's complaint limits ticket markups to no more than $2 over the original face value. On its face, the law perhaps seems a bit harsh toward scalpers who concededly put time and effort into unloading generally high-demand tickets.

But as with so many laws, this one is riddled with exceptions. Worse, the exceptions are ill-defined, to be generous. The statute vaguely defines the types of fees that can be charged, but provides no concrete definitions or further limitations on such fees.

As it turns out, Herman's suit was thrown out because he didn't have standing to bring it in the first place. According to the Supreme Judicial Court, since Herman never actually bought a ticket, he was unable to prove that he suffered injury as a result of the allegedly unlawful prices. In a dissent, Judge Judith Cowin said that Herman's being "ready, willing, and able to purchase a lawfully priced ticket" was enough to give him standing to bring the suit.

It was doubtless a tough blow for Herman, who was awarded $25 million in damages at trial, but saw the verdict overturned on appeal. The Supreme Judicial Court's decision affirmed that of the Appeals Court.

In any event, the court's ruling acknowledged the near-uselessness of the statute. Judge Mark Covin noted that "the statute specifies the types of fees a ticket reseller may assess...[but] does not impose readily ascertainable restrictions on those fees, such as dollar or percentage limits." Worse, the law allows scalpers to recover "service charges," a term that includes phone calls, messenger services, or any other expenses that may be necessary to get the tickets to the consumer. Determining whether such fees have actually been incurred is essentially impossible, the court noted, without pouring time and money into litigation--and even then the plaintiff may remain in the dark.

No matter their thoughts on scalping, most would agree that a $2-above-face-price limit might be a bit stringent. As it turns out, there's a good explanation for that: the law was passed in 1924. Indeed, in 2007 the Massachusetts legislature made noise about throwing the law out and starting from scratch, or even doing away with scalping regulations altogether and allowing ticket resellers to charge as much as they want. State Rep. Michael Rodrigues asserted that lawmakers are "less concerned about what people pay. Our concern is consumer protection.

Herman, the suit's plaintiff, however, was unconvinced. He told the legislature that erasing limits on resale prices would limit Red Sox attendance to the wealthy, leaving the average ball fan out in the cold.

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