FTC goes after Ticket Scalpers, seeks Tens of Millions in Damages

The U.S. Federal Trade Commission (FTC) is taking legal action against ticket resellers for violation of the BOTS Act seeking “tens of millions of dollars” in penalties.

Ticket scalpers frequently use ticket buying bots, multiple accounts under pseudonyms, and other strategies to purchase concert and other event tickets for resale on platforms like StubHub, Vivid Seats, SeatGeek.

The FTC has been looking into ticket resale separately from a Department of Justice investigation of Live Nation, Ticketmaster, concert promotion, venue management and primary ticketing.

FTC goes after Ticket Scalpers

News that the FTC was aggressively enforcing the Better Online Ticket Sales (BOTS) Act came after ticket reseller Key Investment Group (KIG) filed a lawsuit hoping to stop the FTC action.

“this case matters”

“This case matters,” says manager and live music industry pundit Randy Nichols. “If the government can hold operators like KIG accountable, it sends a message to every other company exploiting fans through shady resale tactics. It also pressures platforms like Ticketmaster to clean up what they’ve quietly enabled.

The BOTS Act is intended to stop software that circumvents ticket sales security to buy tickets. “This is not what KIG does,” argues KIG. “The FTC believes the ticket limits set forth by the primary ticket issuer apply on a company level and not individual. The FTC’s novel interpretation of the BOTS Act would make many consumers and most companies – including nearly every Fortune 500 company – in violation of the law.”

“KIG’s model involves using hundreds of Ticketmaster accounts, pseudonyms, and remote browsing tools to scoop up tickets and flip them on resale platforms,” says Nichols. “They claim it’s legal because they didn’t use “bots.” But let’s be honest: it’s functionally no different.”

“If KIG doesn’t think multi-account behavior violates the BOTS Act they should go back and read the law. NITO is encouraged to see the FTC continue to crack down on BOTS Act violators and will happily assist their efforts anyway we can.” 

Key Investment Group also operates under Total Tickets, Totally and Front Rose Tix. Plaintiffs in the lawsuit include iWLK Investments, Yair D. Rozmaryn, Elan N. Rozmaryn and Taylor Kurth.

In 2018, Kurth paid Washington state $60,000 for using “ticket bot” software, a violation of Washington’s Ticket Sellers Act.

Bruce Houghton