Relates to resale of tickets to places of entertainment; repealer

Summary of provisions

Section 1 of the bill would repeal Article 25 of the arts and cultural affairs law and add a new Article 25.

Specifically, section 25.01 contains legislative findings.

Section 25.03 sets forth definitions.

Section 25.05 would make ticket speculation a misdemeanor.

Section 25.07 would require operators of places of entertainment to print the established ticket price and maximum premium price on the face of each ticket, and sets additional requirements on ticket resellers.

Section 25.09 would require every operator of a place of entertainment having a permanent seating capacity in excess of five thousand persons to print on each ticket, "This ticket may not be resold within one thousand five hundred feet from the physical structure of this place of entertainment under penalty of law."

Section 25.11 would prohibit ticket reselling within a buffer zone.

Section 25.13 would require the licensing of ticket resellers, and prohibit the reselling of any ticket during the first forty-eight hours after such ticket is first available for primary sale.

Section 25.15 would require applicants for reseller licenses to file a bond with the secretary of state.

Section 25.17 would grant the secretary of state power to investigate ticket resale practices.

Section 25.19 would require the recipients of resell licenses to post the license in a conspicuous place at all times in the principal office of such business for which it is issued.

Section 25.21 would require licensed resellers to notify the secretary of state in the event of an office relocation.

Section 25.23 would require every such licensee under this article to post a price list showing the established price charged by the operator of the place of entertainment and the price being charged by such licensee for the resale of such ticket.

Section 25.24 would make it unlawful for any person to utilize automated ticket purchasing software.

Section 25.25 would require licensed resellers to keep full and accurate records of purchases and sales.

Section 25.27 would make it unlawful for any licensee under this article to pay any commissions to employees of places of entertainment in connection with the resale of tickets.

Section 25.29 would prohibit operators of entertainment venues from charging more than the established ticket price, plus taxes and reasonable service fees, and would give the attorney general concurrent jurisdiction with the district attorney.

Section 25.30 would prohibit operators of entertainment venues from restricting the resale of any tickets included in a season ticket package as a condition of purchase; deny access to a ticket holder who possesses a resold subscription or season ticket to a performance based solely on the grounds that the ticket was resold; employ a form of paperless ticketing that is not readily transferable to another customer through a transaction independent of the operator, unless a purchaser is given the opportunity initially to purchase the tickets in some other form, including paper. This section would also prohibit operators from engaging in the ticket resale business and it would require ticket operators, promoters and resellers to disclose when seats offered by tickets would include an obstructed view.

Section 25.31 would allow the department of state to deny or revoke a license granted under this article, and impose fines, provided that the licensee has an opportunity for a hearing.

Section 25.33 would require the attorney general to establish a toll free telephone number through the office of the attorney general's website in order to allow the public to make allegations of improper ticket acquisition, distribution, or sales practices and it would require the attorney general to investigate as appropriate all credible allegations. This section also confers a private right of action upon individuals allegedly injured as a result of violations of this article.

Section 25.35 sets forth criminal penalties.

Section 2 sets forth the effective date.

Justification

This legislation would enact several new provisions to protect consumers:

* A price cap of 20% over the established primary market price would be set for those tickets resold on the secondary market. For both primary and secondary ticket sales, unrestricted resale creates upward pressure on pricing and greater potential for market manipulation; a 20% price cap would help in addressing this problem.

* This legislation would extend new consumer protections on the primary market, by prohibiting venue operators and their agents from

employing paperless ticketing systems that do not allow consumers to transfer their tickets independent of the operator or operator's agent, unless the operator offers the consumer a choice of purchasing independently transferable tickets in another form.

* Further limits would be placed on operators by preventing them, or any of their agents, from engaging in the business of ticket resale on the secondary market.

* This bill would require secondary sellers to clearly identify themselves on their website to prevent confusing and deceptive tactics such as unannounced website "pass-throughs." The legislation would provide for a new reporting requirement for both primary and secondary ticket seller's that would enable the State to better determine the impact of the resale marketplace on consumers, as well as to study the purchasing trends of consumers.

* The Attorney General's office would assume enforcement and regulation of the ticket resale industry through the creation of a toll free hotline to allow consumers to report instances of abuse and deception.

* For stronger deterrence, criminal penalties will be strengthened by doubling the fines currently established in Section 25.35 of the Arts and Cultural Affairs Law.

* The consumer would be given priority in this legislation through the establishment of a short "cooling off" period after the initial release of tickets to the public during which the secondary market will be prohibited from selling tickets. This will guarantee the public an opportunity to purchase tickets without interference from the secondary market.

* The bill would prohibit the use of automated ticket purchasing software, which presently is used by unscrupulous speculators to purchase tickets at initial sale ahead of consumers intending to attend an event. While the use of this software is typically banned by the policies of ticket issuers and venue operators, this statutory prohibition would allow the State to intervene to further protect consumers.

* The bill would make permanent ACAL § 25.11, which relates to ticket office buffer zones.

Legislative history

S.5039 (Squadron) - Investigations and Government Operations

Fiscal impact on the state

None.

Effective date

This act shall take effect immediately and shall be deemed to have been in full force and effect on and after May 16, 2014.