Will a Ticket’s Price Always Exceed its Worth?

Want to watch the Boston Celtics take on their playoff nemeses of the past two seasons, the red-hot Lebron James and the Miami Heat? No problem, except the cheapest seats in the house will cost you $85.  Brokers can buy tickets at face value before selling at a substantial profit. Initially, sporting events, concerts, and other entertainment events are allocated upon a first-come, first-served basis. However, scalpers allow for a more market-based method to determine who can sit in the seats, as the initial buyers can resell the tickets at whatever price people are willing to pay. This system allows for people who really want to attend the events, and have adequate resources, to achieve their heart’s desire, but it can also help to bar people with lesser means from live entertainment. Different states have taken varying approaches to dealing with this issue, with many opting to, at least in some cases, let the market control.

Sites such as StubHub have generally received the legal green light. As one DePaul Law Review article points out, “a majority of states have already enacted some type of regulation to control ticket scalping,” but most of those that have allow for licensed brokers. For example, New Jersey bans reselling tickets above a certain threshold, unless of course the seller utilizes an “internet website” in order to facilitate the deal. Even when the ticket selling itself might be unlawful, some jurisdictions have shielded the website from consequences. In a South Carolina Court of Appeals Case, the court held even if the sale of concert tickets far above face value was unlawful, StubHub was not liable since it did not control the price.

The law as it is protects ticket resale, at least from certain sources, but how should the law operate? On the one hand, there would not be high prices if people were not willing to pay them. However, live events should be the province of all the public, and not simply people with the means to pay whatever scalpers choose to charge. A compromise solution seems to be found. Exceptions to resale caps ought to be reconsidered, although a hard cap of face value seems unlikely to garner much support. On a private level, venues should consider marking certain tickets, especially those at the lowest price, as “Not for Resale,” and states can use tax incentives to goad venues into doing so. Modest reforms can keep live entertainment from only being the province of the early birds, while not leaving the masses at the gates.

Written by Timothy Fleming. Timothy Fleming is a 1L at Harvard Law School.