Ticketmaster's being sued by the FTC. Could it finally make buying concert tickets less of a nightmare?

By Weston Blasi

As the FTC ramps up its war against resellers and bots with its lawsuit against Ticketmaster, what can be done to level the playing field so that scalpers don't snatch up all the tickets?

The FTC has filed a lawsuit against Ticketmaster, alleging the ticket-seller profited off of illegal resale tactics that cost its customers hundreds of millions of dollars.

The Federal Trade Commission filed a lawsuit against Live Nation and Ticketmaster on Thursday, alleging the platform engaged in illegal ticket resale tactics and deceived both artists and consumers about prices and ticket limits for events.

The complaint also claims that Ticketmaster earned hundreds of millions of dollars selling tickets that were bought illegally by brokers, which ended up costing customers billions of dollars in inflated prices and additional fees. The FTC is seeking civil penalties against Ticketmaster and any additional monetary relief that the court finds appropriate.

Ticketmaster has previously denied any wrongdoing and did not immediately respond to request for comment following the Thursday news release of the FTC complaint. Prior to the lawsuit, a company representative told MarketWatch earlier this week that the company has been working to protect its customers from scalpers.

Also read: Why Ariana Grande opting out of dynamic pricing might actually help ticket scalpers - and not her fans

"Ticketmaster has invested more to stop scalpers than the rest of the industry combined," a spokesperson told MarketWatch. "We believe the FTC has a fundamental misunderstanding of Ticketmaster's policies, and is taking an excessively expansionist view of the BOTS Act. We haven't violated the BOTS Act and will vigorously defend any such claims, however we would prefer to work with the FTC to implement policies to improve the ticketing industry."

The FTC declined to comment, and referred MarketWatch to the press release announcing the lawsuit.

Ticket brokers under investigation

The FTC had been investigating whether Live Nation (LYV) subsidiary Ticketmaster was doing enough to stop armies of bots and ticket brokers from buying and selling tickets on its platform, and examining the company's compliance with the Better Online Ticket Sales (BOTS) Act. The 2016 law bars the use of bots to bypass ticket-purchase limits set by online platforms.

Bots have been used for years to help some customers quickly purchase highly sought-after tickets or limited-edition items, often to resell them for a profit on the secondary market. The bots do this, in part, by enabling buyers to create multiple accounts to improve their chances of not only purchasing a single pair of coveted tickets, shoes or other coveted items, but getting ahold of multiple blocks of tickets, shoes, etc. Bots can also be used to expedite the payment and checkout process - being able to do so much faster than a human can - which further ensures a successful purchase.

"The bots are artificially creating demand through scarcity, and dynamic pricing will push prices higher," said Christopher Anderson, a professor at Cornell's SC Johnson College of Business who has researched event operations and dynamic pricing. "Then, those high-priced tickets go into the secondary market."

He explained that, "Most platforms have a surcharge or percentage charge [to resell the ticket]. That incremental charge, we hope, is going back to the artists, but there are all kinds of middlemen in there that are sharing in those ticket-revenue increases."

The new FTC suit claims that Ticketmaster has had a financial incentive to allow resellers to exploit its systems and bypass its ticket-limit rules. "Ticketmaster is aware that brokers routinely bypass such measures by creating thousands of Ticketmaster accounts and using proxy IP addresses in order to purchase event tickets," it claims. "Ticketmaster nevertheless allows brokers to post these illegally obtained tickets for resale on its platform, then profits from the additional fees and markups it unilaterally adds to the resale tickets."

The complaint also alleges that, "in public, Ticketmaster maintains that its business model is at odds with brokers that routinely exceed ticket limits. But in private, Ticketmaster acknowledged that its business model and bottom line benefit from brokers preventing ordinary Americans from purchasing tickets to the shows they want to see at the prices artists set."

For example, the complaint alleges that a senior Ticketmaster executive admitted in an internal email (that included Live Nation leadership) that the companies "turn a blind eye as a matter of policy" to brokers' violations of posted ticket limits. "For instance, an internal review showed that just five brokers controlled 6,345 Ticketmaster accounts and possessed 246,407 concert tickets to 2,594 events," the suit adds.

Read more: StubHub's stock dips in first day of trading. The IPO is a bet on the polarizing practice of ticket resales.

Before the FTC suit went public, Dan Wall, the executive vice president of regulatory affairs at Ticketmaster, told MarketWatch that "Concert-ticket resale is a small part of our business, but other secondary marketplaces are getting 80% or more of their volume from brokers."

Indeed, rival StubHub (STUB) has also received some criticism for the high ticket prices on its resale marketplace - yet the company's IPO on Wednesday saw the stock initially climb 10% as investors banked on consumer demand for live shows and concerts. Shares ended the day down 6%, though.

What can be done to block bots and scalpers?

So what more could Ticketmaster and other ticket sellers be doing to combat bots and scalpers?

Meaningful reform in the ticket industry has been slow, as regulatory hurdles and sophisticated technology make it hard to crack down on bad actors manipulating the system. But both the Biden and Trump administrations have been shining a legal light on the matter.

The Biden administration's ban on junk fees, which went into effect in May, requires Ticketmaster to display the full price of a ticket as soon as consumers begin shopping. And President Donald Trump signed an executive order earlier this year directing the FTC to "take enforcement action to prevent unfair, deceptive, and anti-competitive conduct in the secondary ticketing market."

Just last month, the FTC also filed a lawsuit against Maryland-based ticket broker Key Investment Group, accusing the reseller of using thousands of fictitious Ticketmaster accounts and other methods to buy tickets for events, such as Taylor Swift's 2024 Eras Tour. The FTC alleges that the group spent nearly $57 million to buy the tickets - and resold them on secondary marketplaces for approximately $64 million.

"Independent venues and promoters are on the frontlines of this broken system, and it is fans and artists who ultimately pay the price. We applaud the FTC for bringing this case," the National Independent Venue Association Executive Director Stephen Parker wrote to MarketWatch in a statement.

Multiple ticketing industry sources also that MarketWatch spoke with agreed that one approach could be to make tickets non-transferrable, like airplane tickets. They still cautioned that this could create other scarcity problems, however.

Outside of live events, one anti-botting measure that Adidas (XE:ADS) has tested for high-demand sneaker sales in recent years is using raffles and pre-charging a user for a pair of shoes before their account has even won the lottery to purchase the limited-edition product. Here's how it works traditionally: One of these raffles would be for a finite period of time. Users could enter that raffle for free with their payment information already linked to their accounts, and if they won the raffle, then they would be automatically charged the price of the shoes. People who didn't win, however, would not be charged.

See: The FIFA World Cup ticket presale is live. What to know about dynamic pricing, lotteries and sale dates while trying to score seats.

Adidas began charging each user to enter the raffle (as much as $230 for some items) and refunded those entry fees in the weeks after the lottery for those who didn't win. This new system means that any bot users trying to game the system by using hundreds if not thousands of faux accounts to join the raffle would need a large amount of up-front capital to join the raffles.

Alabama-based sneaker content creator David Daniels, who goes by SneakerPhetish on social media, told MarketWatch that he's been talking about bots snatching up limited-quantity goods for years on his YouTube channel. He thinks that the best ways to curb bots would include using a third-party authenticator that can verify real people are buying tickets (like EQL).

Or, here's a novel idea for sales on a smaller scale in the digital age: Beat bots by having people come pick up tickets or in-demand products in person, such as at a release party.

"I would suggest releasing in-stores or with retailers, and minimizing online releases that bots can manipulate," he said.

-Weston Blasi

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09-18-25 1615ET