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Legislation Document
SPONSOR:
Sen. Seigfried & Rep. Ross Levin
DELAWARE STATE SENATE
153rd GENERAL ASSEMBLY
SENATE SUBSTITUTE NO. 2
FOR
SENATE BILL NO. 181
AN ACT TO AMEND TITLE 6 OF THE DELAWARE CODE REGARDING THE SECONDARY TICKETING MARKET.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE:
Section 1. Amend Title 6 of the Delaware Code by making deletions as shown by strike through and insertions as shown by underline as follows:
CHAPTER 25N. Sale and Resale of Tickets
§ 2501N. Definitions.
As used in this chapter:
(1) "Bot" means any machine, device, computer program, or computer software that, on its own or with human assistance, bypasses security measures or access control systems on a retail ticket purchasing platform, or other controls or measures on a retail ticket purchasing platform that assist in implementing a limit on the number of tickets that can be purchased, to purchase tickets.
(2) “Division” means the Division of Consumer Protection of the Department of Justice established in § 2517 of Title 29.
(3) “Fan club” means a membership-based program, primarily established by venues, artists, or performers to offer pre-sale opportunities before public on-sale of tickets.
(4) “Original total price” means the total price the ticket issuer charges for a ticket at initial sale, including all original fees and taxes in connection with the initial ticket.
(5) “Primary ticketing platform” means a website or other system owned, operated, or authorized by an event organizer or venue operator that is used to conduct or facilitate the initial, primary sale of tickets.
(6) “Primary ticket seller” means, with respect to a ticket, any person who has the right to sell the ticket prior to or at the primary sale of the ticket, including the event organizer, or any person that provides services to conduct or facilitate the primary sale of tickets by or on behalf of the event organizer.
(7) "Resale" means the second or subsequent sale of a ticket by any method, including in-person transactions, telephone, mail, email, facsimile, or electronic means through websites or mobile apps.
(8) "Reseller" means a person engaged in the resale of tickets.
(9) "Secondary ticket exchange" means an electronic marketplace enabling the sale, purchase, and resale of tickets.
(10) "Speculative ticket" means a ticket not in the actual or constructive possession of the reseller at the time of listing, sale, or advertisement. This includes tickets not owned by the reseller or under contract to be transferred to the reseller at the time of sale.
(11) "Ticket" means any form of physical, electronic, or other evidence that grants the possessor of the evidence license to enter a place of entertainment for one or more events held in this State at a specified date and time.
§ 2502N. Ticket disclosure requirements.
(a) This section applies to primary ticket sellers, secondary ticket exchanges, ticket issuers, and resellers.
(b) The following information must be clearly and conspicuously disclosed prior to payment information being required:
(1) The total price of the ticket, including all fees, taxes, and any additional charges other than shipping costs that may vary based on delivery options.
(2) An itemized breakdown of all components of the total price, including taxes, service charges, and other fees.
(3) Seat number or section of the ticket, where applicable, based on the venue's seating arrangement.
(c) The total price, including all fees, taxes, and applicable shipping costs, must be clearly disclosed before the final purchase. Shipping costs may vary by location and delivery method.
§ 2503N. Prohibition of speculative ticket sales.
A reseller may not sell or offer to sell any speculative ticket.
§ 2504N. Presale restrictions.
(a) A primary ticket provider, reseller, secondary ticket exchange, or any affiliate of these parties may not resell a ticket until tickets to the event have been placed on sale by the venue, event organizers, or their authorized agent. For purposes of this section, “placed on sale” means the date and time when tickets are made available for sale to the general public, excluding any prior sales to fan clubs, businesses, and persons for promotional activities. This paragraph does not apply to season or subscription ticket holders.
(b) A reseller, secondary ticket exchange, or any affiliate of these parties may not access, obtain, or resell a ticket through a fan club program before tickets are placed on sale.
§ 2505N. Transferability and restrictions on tickets.
A ticket of admission to a theatrical exhibition, public show, public amusement or exhibition must be considered a license. Venue operators, or operators’ agents, may maintain and enforce policies, conditions, or requirements for ticket purchase with respect to conduct, behavior, public health and safety, or age at the venue or event and may establish limits on the quantity of tickets that may be purchased.
§ 2506N. Refund requirements.
(a) A primary ticket seller, secondary ticket exchange, or reseller directly engaged in a transaction with a purchaser must provide a full refund, including all fees and taxes, under the following conditions:
(1) The ticket is counterfeit.
(2) The event is cancelled.
(3) The ticket does not conform to the description provided at the time of purchase.
(b) A refund must be issued within 10 days of the event's cancellation or discovery of non-conformance.
§ 2507N. Ban on deceptive URLs and improper use of intellectual property.
It is unlawful for a secondary ticketing exchange, reseller, or the operator of any website purporting to sell or offer for sale tickets that links or redirects to a secondary ticketing exchange or reseller, to do any of the following:
(1) Use any artist name, venue name, or event organizer name, graphic, marketing logo, image or other intellectual property of the artist, venue, or event organizer including any proprietary resemblance of the venue where an event shall occur in promotional materials, social media promotions, or URLs of the secondary ticketing exchange, reseller, or website without the prior authorization of the respective artist, venue, or event organizer under the terms of agreement between the artist, venue, or event organizer and the secondary ticketing exchange, reseller, or website.
(2) State or imply that the secondary ticket exchange, reseller, or website is affiliated with or endorsed by a venue, team, or artist, as applicable, including use of words like "official" in promotional materials, social media promotions, search engine optimization, paid advertising, URLs, or search engine monetization unless the secondary ticketing exchange, reseller, or website has the express written consent of the venue, team, or artist, as applicable.
§ 2508N. Prohibition on circumvention of internet ticket sales limitations.
(a) A reseller may not use or create a bot, or employ any other method, to do any of the following actions:
(1) Purchase tickets for any single internet ticket sale.
(2) Use multiple Internet Protocol (IP) addresses, purchaser accounts, or email addresses to purchase tickets in excess of 8 tickets, or the posted limit if less than 8 tickets, for any single internet ticket sale.
(3) Circumvent or disable an electronic queue, waiting period, presale code, or other sales volume limitation system associated with an internet ticket sale.
(4) Circumvent or disable a security measure, access control system, or any other control or measure used to facilitate authorized entry to an event.
(b) A primary ticketing platform shall report any known circumvention or attempted circumvention of the prohibitions in subsection (a) of this section for any event held in this State to the Division within 30 days of discovery.
(1) The report must include the following:
a. A description of the incident, including the nature of the circumvention.
b. Any available information about the individuals or entities involved.
c. Measures taken or planned to prevent further circumvention.
(c) The primary ticketing platform shall retain all relevant records of the incident for a period of 1 year and make them available to the Division upon request.
§ 2509N. Price limitation.
The price at which a reseller or secondary ticket exchange may sell or offer to sell a ticket may not exceed 110% of the original total price of the ticket.
§ 2510N. Enforcement.
(a) Any violation of the provisions of this chapter shall be deemed an unlawful practice under § 2513 of this title and a violation of subchapter II of chapter 25 of this title.
(b) Any person responsible for setting the original base price of a ticket sold in violation of this chapter may bring an action in a court of competent jurisdiction for appropriate legal or equitable relief. If the person establishes a violation by a preponderance of the evidence, the court shall award nominal damages in the absence of actual damages, and shall award the prevailing plaintiff reasonable attorneys' fees and costs incurred in the prosecution of the action. The court may also award restitution to the affected consumers. Upon the agreement of the Attorney General, such restitution shall be deposited in the Consumer Protection Fund, established under § 2527 of this title for the purpose of administrating and providing restitution to affected consumers and, if eligible consumers cannot be identified after reasonable diligence, for any other permissible purposes under § 2527 of this title.
Section 2. This Act is effective immediately and is to be implemented the earlier of the following:
(1) One year from the date of the Act’s enactment.
(2) Notice by the Division published in the Register of Regulations that final regulations for implementing this Act have been promulgated.
SYNOPSIS
This Act is a substitute bill for Senate Bill No. 181. It changes the following from the original bill:
1. Adds definitions for “original total price” and “primary ticketing platform” while removing the definition of “ticket issuer” from the original bill.
2. Omits language regarding transferability of a ticket in § 2505N to better reflect that most tickets do not restrict transferability of a ticket; however, this omission would not restrict an artist or venue from choosing to restrict transferability as part of terms and conditions of the ticket.
3. Provides clarity by removing “event ticket” as used in the original bill for simply “ticket”.
4. Changes the amount of time a primary ticketing platform must report a known or attempted circumvention of ticket sales to the Division from 48 hours to 30 days.
5. In § 2509N, the concept of a price cap is replaced with price limitation, which limits the price at which a reseller or secondary ticket exchange may sell or offer to sell a ticket to 110% of the original total price of the ticket.
6. Removes sections from the original bill pertaining to registration and reporting requirements of resellers, bond requirements, secondary ticket exchange responsibilities, consumer compensation, audit and oversight, public access to registered resellers, and revocation of resellers.
7. Changes the penalty section to clarify violations of this chapter are unlawful practices under § 2513 of this title and subject to penalties of subchapter II of chapter 25 of Title 6. It also establishes a private right of action for victims who set the original base price of a ticket to seek relief and obtain an award of attorneys’ fees if they are the prevailing party. Any excess awards are to be deposited in the Consumer Protection Fund of the Attorney General for the purpose of providing restitution to other affected customers.
8. Minor technical changes.
This substitute bill, as in the original bill, prohibits certain actions regarding the sale and exchange of tickets for events in this state by primary ticket sellers, ticket issuers, and ticket resellers. It requires a clear and conspicuous disclosure of fees and costs associated with the total cost of a ticket being provided to a purchaser before the purchaser’s payment information is requested. The substitute bill prohibits the reselling of a ticket until the event is placed on sale to the general public, including any tickets that may be obtained or accessed through a fan club. It further sets forth requirements regarding transferability of tickets, refunding of tickets, and bans the use of deceptive practices for any reselling of a ticket.
This Act prohibits use of a bot or other methods used to circumvent reasonable restrictions on the sale of tickets on the internet. The Act places a price limitation of up to 110% of the original total price of the ticket.
This Act is effective immediately and is to be implemented the earlier of 1 year from the date of enactment or notice of publication within the Register of Regulations that final regulations have been promulgated.
Author: Senator Seigfried