StubHub Must Amend Gripe With Ticketmaster

OAKLAND, Calif. (CN) - A federal judge Thursday rejected StubHub's claim that the Golden State Warriors teamed up with Ticketmaster to control resale of season tickets, ruling that the online ticket exchange couldn't prove a clearly identifiable, relevant market for its services.

StubHub and Ticketmaster both provide a secondary service by which ticketholders can resell their tickets, usually at a discount, though Ticketmaster dominates the market for primary, or first-sale tickets.

In its federal antitrust lawsuit filed in March, StubHub claimed Ticketmaster formed a partnership with the Warriors to become the official online exchange to resell tickets, thereby shoving StubHub out of the picture. It claimed the NBA team canceled or threatened to revoke season ticket privileges if it found season ticketholders reselling on StubHub.

In a brief order late Thursday, U.S. District Judge Maxine Chesney said she was not persuaded by StubHub's arguments about markets for primary or secondary tickets. She dismissed the complaint with leave to amend.

"StubHub's Sherman Act claims are based on a theory that there exist two separate product markets for Warriors tickets to games played at Oracle Arena, the difference between those markets being whether the purchaser obtains from the supplier a 'primary' ticket or a 'secondary' ticket," Chesney wrote.

She likened the ticket markets to Brown Shoe Co. v. United States, where the government, in challenging the merger of two shoe manufacturers, unsuccessfully argued that medium-priced shoes occupy a different product market than low-priced shoes.

In the StubHub case, Chesney found, both kinds of tickets are "reasonably interchangeable." In other words, a ticket is a ticket. Whether it's sold directly at the stadium or through an online reseller, both will get you into the game.

She said the idea of a primary ticket market fails because "the sole products for sale in said market are Warriors tickets sold 'directly by the team' itself." StubHub cannot pin antitrust liability on the Warriors' natural monopoly in the sale of its own product, Chesney said.

Chesney dismissed the entire complaint without prejudice, and gave StubHub until Nov. 30 to amend its claims.

Follow @MariaDinzeo

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