The U.S. Federal Trade Commission sued ticket reseller Key Investment Group for evading purchasing limits to buy up thousands of tickets to live events including Taylor Swift's Eras tour and resell them at a markup, according to a complaint filed in Maryland federal court on Monday.
The Baltimore, Maryland-based company, which operates ticket resale sites including TotalTickets.com, used thousands of Ticketmaster accounts, including fake or purchased accounts, the FTC said.
Ticketmaster faced intense criticism after its botched 2022 sale of tickets to Swift’s much-hyped Eras tour, when billions of requests from Swift fans, bots and ticket resellers overwhelmed its website and the company canceled a planned ticket sale to the general public.
For one Swift concert in Las Vegas in March 2023, Key Investment Group and its affiliates used 49 different accounts to purchase 273 tickets and evade a 6-ticket purchase limit, netting more than $119,000 in revenue on resales, the FTC said on Monday. The company made more than $1.2 million reselling 2,280 Swift concert tickets it purchased in 2023, the agency said.
FTC Chairman Andrew Ferguson said in a statement that the lawsuit puts ticket sellers on notice that the agency will go after those who circumvent ticketing platforms' limits on ticket sales.
The lawsuit is part of a crackdown President Donald Trump announced in March focused on curbing exploitative ticket reselling practices that raise costs for fans.
"In an unprecedented move, the FTC has twisted the intent of the Better Online Ticket Sales (BOTS) Act, a law designed to target malicious software, into a weapon against legitimate businesses and consumers," a Key Investment Group spokesperson said on Monday.
The company sued the FTC in July to block its investigation, saying that its ticket purchases did not use automated software, or bots, and did not violate the BOTS Act.
The FTC has made it clear that "they intend to use the BOTS Act to shut down the entire secondary-ticket market," the company said in its lawsuit.
The agency on Monday accused Key Investment Group and three of its executives of violating the BOTS Act as well as the FTC Act, which prohibits unfair and deceptive business practices.
Ticketmaster by 2018 had determined that Key Investment Group and other brokers were violating its rules and using thousands of accounts, according to an excerpt from an internal presentation included in the complaint.
The 2018 presentation showed Ticketmaster predicted "serious negative economic impact" if it were to impose strict ticket sales limits.
In July, the company called on Congress to pass reforms including giving artists the right to limit ticket resales and cap markups at 20%, saying ticketing platforms cannot combat exorbitant markups on their own.
Live Nation, which owns venues and promotes events, and Ticketmaster are facing a lawsuit brought by U.S. antitrust enforcers accusing the company of monopolizing markets across the live concert industry.
