Los Angeles, CA: Ticketmaster has agreed to a tentative $400 million settlement, potentially ending a consumer fraud class action filed over "order processing fees."
Filed in 2003, on behalf of 50 million ticket purchasers, the consumer fraud lawsuit alleged that Ticketmaster, now owned by Live Nation, misled consumers by charging "order-processing fees" and a UPS "delivery fee" that were profit generators for the company – not fees for service as claimed. At the time the lawsuit was filed, Ticketmaster was part of IAC/Interactive Corp.
The five plaintiffs who filed the class action, claimed to have been charged separate "convenience fees" and "facility fees," as well. Both sets of fees they understood to be profit centers for Ticketmaster. They claimed that they were unaware that the other fees were also profit generators for the company, and if they had known in advance of purchasing the tickets, they wouldn't have paid those fees.
According to the terms of the preliminary settlement, some 50 million US consumers who bought tickets that included an "order-processing fee" on Ticketmaster's website from October 21, 1999, through February 27, 2013, will be eligible to receive a total of $386 million in discounts on future purchases. Ticketmaster will issue up to 161 million credits for $2.25 each and up to 4.9 million credits for $5 each, according to court document, and will make tickets for certain events available free to class members on a first-come, first-served basis at the end of each year for the next four years if members redeem less than $10.5 million of the coupons each year. Additionally, Ticketmaster has changed the language on its website to clarify that order processing and delivery charges may include a profit for Ticketmaster.
A final settlement hearing is scheduled for January.
