‘It’s like whack-a-mole’ — Utah lawmakers consider new rules for proliferating ticket resellers

(Rick Egan | The Salt Lake Tribune) The musical "Wicked" is making its fourth extended stop in Salt Lake City with a five-week run now underway at the downtown Eccles Theater. ArtTix is the official ticketing source for the Zions Bank Broadway at the Eccles series, but buyers may see ticket reseller sites when they search online. A bill in the Utah Legislature aims to help buyers know when they are purchasing from a reseller's website rather than directly from a venue. Friday, Feb. 8, 2019.

When someone searches “Eccles Theater” online, maybe seeking tickets for the run of “Wicked” now underway, the official website for the Eccles Theater usually is not the first site a search engine displays.

“The first things that come up are ticket resellers,” said Sarah Pearce, division director for Salt Lake County Arts and Culture, the government agency that operates four downtown Salt Lake City venues: the Eccles, Abravanel Hall, the Capitol Theatre and the Rose Wagner Performing Arts Center.

The second-tier marketers — what are sometimes derisively called ticket scalpers — acquire tickets to events and resell them. If an event is sold out on an official site, and particularly popular, the second-tier sellers will mark up the price well above face value.

The issue, Pearce said, is that such a markup may happen even if the show isn’t sold out, and consumers “may get frustrated that they pay more for something than if they get it on our site.”

A bill introduced in the Utah Legislature is aimed at making it easier for ticket buyers to tell the difference between a venue’s website and a copycat.

The bill — HB128, the Consumer Ticket Protections Modifications to the Ticket Sales Act, sponsored by Rep. Stephen Handy, R-Layton — addresses a problem arts groups face: websites that route unwitting buyers to secondary resellers or fraudulent sites that sell counterfeit tickets to the groups’ events.

The bill would make it illegal for a website to masquerade as a venue’s site by having the venue’s name in the site’s URL before the “.com” or “.net.”

The bill is an effort “to provide some clarity for consumers, to let them know who they’re in business with,” said Daniel O’Bannon, director of the Division of Consumer Protection in the Utah Commerce Department, at a Utah House Business and Labor Committee meeting Thursday.

Handy said he learned about the practice after a constituent tried to buy tickets to the touring show of “Riverdance” at Eccles last year and landed on an unofficial website.

“They thought they were buying tickets online. They turned out to be fraudulent,” Handy said, adding that the buyer spent about $1,000, which was later recovered through O’Bannon’s consumer-protection division.

Crystal Young-Otterstrom, executive director of the Utah Cultural Alliance, a consortium of arts and humanities groups, points to copycat sites like AbravanelHall.net. That site, if one didn’t know better, could be mistaken for the venue’s official site. This site, however, redirects users seeking tickets to a reseller site called Ticket Liquidator.

The difference in price can be sharp. Take, for an example, a Feb. 15 Utah Symphony performance of music from “My Fair Lady.” On Thursday, the county’s website had tickets available on the orchestra level at either $54, $64 or $78, depending on the row. On Ticket Liquidator, ticket prices started at $70, $81 and $98, in the same sections. StubHub listed tickets in the back two-thirds of the orchestra level (the row wasn’t specified) for $83.60 and up.

Wendi Hassan, director of the Cache County Center for the Arts in Logan, said she and other arts groups have seen more and more cases of “predatory third-party reselling tactics. It’s like whack-a-mole. There are so many sites.”

Hassan complained that counterfeit sites funnel money to people out of state, “to people with no investment in the community,” she said.

And customers who get fooled may take it out on the venues, Hassan said. “It’s frustrating. [Those customers] may not come back,” she said.

Handy’s bill would make such counterfeit sites illegal, reportable to the Division of Consumer Protection. Violators could face a fine of up to $2,500.

Handy’s bill also has provisions for reputable resellers like StubHub. The bill would require ticket resellers to “clearly and conspicuously disclose” that they are a secondary market and not the primary ticket seller, and that the ticket prices may be higher than face value. The resellers also, under the bill, must itemize the total price of a ticket, including taxes and fees.

Representatives for both StubHub and TicketMaster, who consulted with Handy, spoke Thursday in support of the bill, saying it largely codifies practices the resellers already follow because of guidelines set by Google.

Derek Brown, representing StubHub, told the House committee Thursday the bill is “a well-crafted balancing of what needs to be done.”

Handy’s bill exempts churches and religious organizations, and individuals selling tickets they bought as a consumer — for example, if someone bought a ticket intending to attend an event, then sold it to a friend if their schedule changed.

HB128 passed the Business and Labor Committee Thursday with a vote of 9-3. It goes next to the House floor.

The same committee soon will be looking at another bill with a similar name — Consumer Ticket Protection Amendments to the Ticket Sales Act, SB69 — that does something completely different.

The bill’s sponsor, Sen. Deidre Henderson, R-Spanish Fork, said her bill “would ensure that people who buy tickets actually own their tickets. … This is really to keep competition in the secondary market.”

Henderson’s bill would keep venues — such as Vivint Smart Home Arena — from restricting more than 10 percent of their tickets for an event from being transferrable to other users. This would mean venues would have to free up the bulk of their tickets, possibly to be sold on reseller sites like StubHub, rather than reserve them for their own secondary reselling system.

For example, TicketMaster has an arrangement to be the primary ticket seller for The Viv. The bill would keep it from also dominating the resale market for tickets to events there. Under the bill, 90 percent of tickets sold for events at The Viv would have to go on the open market — so TicketMaster and StubHub and other resellers would have an equal chance at buying them and reselling them.

The bill, which already has passed the Senate, has exemptions for colleges, “a Division I college postseason basketball tournament” and “a nonprofit organization that … is domiciled in the state; and produces an annual international film festival in the state.” That last exemption covers only one event: The Sundance Film Festival.

Henderson’s bill would affect only organizations that have the technological means to restrict tickets the way the big venues do, Young-Otterstrom said.

Other strategies that smaller organizations use — such as requiring buyers to pick up tickets, printing “not for resale” on tickets, limiting the number of tickets a patron can resell, or only allowing buyers to transfer tickets to family members — are not restricted under SB69, she said.

(Christopher Cherrington | The Salt Lake Tribune)