The FTC’s ultimate “junk charges” rule focuses on worth honesty in two sectors—stay‑occasion tickets and brief‑time period lodging. It doesn’t straight outlaw speculative ticket listings. However the Fee says the quiet half out loud: when you inform individuals tickets can be found after they’re not, you’ve seemingly crossed the road into deception underneath the rule’s misrepresentation provisions (§§ 464.2(c), 464.3). And we admire them quoting our remark in doing so. See ‘‘Rule on Unfair or Misleading Charges’’ to be codified at 16 C.F.R. pt. 464; 90 Fed. Reg. 2066, 2105 & n.353 (Jan. 10, 2025) efficient Might 12, 2025.
Why that issues (even when it isn’t an outright per‑se ban)
Name it dicta when you like—it’s the company’s rationalization of the way it reads the brand new junk price rule, not a separate prohibition. But it surely’s helpful dicta that factors everybody to the identical place we’ve been pointing for years that Heather VanDyke and I lately mentioned on our “Hassle with Tickets” panel on the Texas Leisure Legislation Institute: you don’t want a brand new statute to cease “spec” listings that faux stock exists. You want fact in representations. And when sellers declare they “have” tickets (or can ship them at a said worth) after they don’t, that’s traditional deception underneath the FTC Act. And, extra to the purpose for personal litigants, plain outdated Blackstone-style frequent‑legislation fraud. The FTC even illustrates the purpose in its enterprise steerage: a speculative ticket vendor that advertises tickets to a bought‑out live performance it doesn’t even have is misrepresenting availability.
A muted toot of the horn (very muted)
In footnote 353, the Fee quotes the remark I filed with Mala Sharma of Georgia Music Companions and Dr. David Lowery arguing that charging customers for speculative tickets is like “charging customers for one thing that doesn’t exist,” and suggesting the rule ought to prohibit taking cost for one thing the vendor doesn’t personal or that doesn’t even exist. The FTC’s response: the ultimate rule doesn’t straight tackle speculative gross sales as a class, however a vendor who represents tickets can be found when they don’t seem to be can violate §§ 464.2(c) and 464.3 of the brand new rule. That’s precisely the body we urged. It’s good to see the document squarely acknowledge the issue and the answer. (90 Fed. Reg. at 2105 and textual content accompanying n.353.)
Furthermore, the Artist Rights Institute’s mannequin ticketing reseller invoice squarely addresses “speculative” listings by prohibiting the provide, commercial, or sale of tickets the reseller doesn’t possess or lacks a gift, enforceable proper to ship. It treats “availability” as a cloth truth and makes misstatements per se misleading. The invoice bars preauthorization or costs for unowned stock, requires conspicuous disclosures of dealer standing and seat/row accuracy, and voids contract phrases that circumvent the ban. Enforcement runs by way of the lawyer common and native prosecutors, with a personal proper of motion, statutory damages, and price shifting. Backside line: no itemizing until you may have the ticket.
You don’t want a brand new legislation to plead this
If you happen to’re a client (or an artist, venue, or promoter harmed by the apply), plain outdated fraud matches the very fact sample fairly properly. When a reseller represents availability now (or at a said worth), is aware of that’s not true (or is recklessly detached), intends the customer to rely, the customer does rely, and suffers damages (misplaced time, cowl purchases at greater costs, charges, journey losses, and so on.). The FTC’s rule reinforces—not replaces—these parts by underscoring that availability is a cloth truth and misstatements in regards to the identification of what’s being bought (an actual, deliverable ticket versus a want) are misleading. See our outdated pal Sir William Blackstone, Commentaries on the Legal guidelines of England, E book III, ch. 8–9 (esp. pp. 122–125 in lots of editions). That’s proper up there with half-cows, and so on.
Sensible pleading angles the FTC simply made simpler
• Materials misrepresentation: “Tickets accessible at X worth” when the vendor has no current skill to ship these tickets at that worth. (§ 464.3 highlights misrepresentations in regards to the “identification of the nice or service.”)
• Omissions that mislead: Failing to reveal {that a} itemizing is speculative (contingent on later acquisition) can render the “accessible now” declare misleading. (§ 464.2(c) requires clear, conspicuous pre‑cost disclosures of fabric details about costs.)
• Company backdrop: The Fee’s steerage offers an instance of a speculative vendor claiming “tickets accessible” to a bought‑out present presents courts and enforcers a prepared‑made illustration of why the declare is misleading.
However isn’t that simply “ticketing enterprise as ordinary”?
If “enterprise as ordinary” depends on pretending stock exists in an effort to extract cost or lock in the next price, that’s not a function—it’s a legal responsibility. The FTC’s rule’s preemption part additionally reminds everybody that state legislation protections stay until they straight battle; stronger state Unfair and Misleading Acts or Practices or ticketing statutes that transcend the FTC’s minimal flooring nonetheless apply. Translation: you’ve bought a number of paths to aid.
And sure, we’ll permit ourselves a small smile that the Fee quoted our remark in footnote 353—these filings take time, and the popularity issues as a result of it alerts artists’ and customers’ expertise is shaping the document. Is it value taking the time to draft a remark for the document? You’re rattling proper it’s.
