Ticket Brokers Busted

A federal judge on Oct. 15 came down strongly on the side of Ticketmaster, agreeing to order a software company to stop a service where it helps people—many of them ticker brokers—buy tickets for Ticketmaster events.

U.S. District Judge Audrey Collins ruled in Los Angeles that the software firm, RMG Technologies, must halt the service and software distribution, even if that means the company may go out of business.

The court held that RMG, of Pittsburgh, violated its terms-of-use agreement with Ticketmaster by helping brokers buy large blocks of tickets—and doing so more quickly than most consumers could—thereby blocking consumers from buying tickets at list prices. The brokers would then turn around and sell the tickets for the now sold-out event at much higher prices.

Although the arguments centered on a wide range of narrow and technical definitions—such as whether the automatically generated cache copy of a page in RAM constitutes a “copy” within the meaning of federal copyright laws—the judge ultimately found most damning promotional language that the court believed came from RMGs own Web sites and advertisements.

For example, Collins pointed to some wording that she said made clear an intent to violate Ticketmasters agreement.

“Use of an application designed to thwart [Ticketmasters] access control by, in [RMGs] own description, stealth technology [that] lets you hide your IP address [so] you never get blocked by Ticketmaster would breach the users agreement to not use any device, software or routine that interferes with the proper working of the site,” she said.

Although Collins agreed that RMG might go out of business if the preliminary injunction was issued, she said the strong chance that RMG would lose out at trial outweighed the harm the company might endure. “In the copyright infringement context, once a plaintiff [Ticketmaster] has established a strong likelihood of success on the merits,” Collins said, “any harm to the defendant that results from being preliminarily enjoined from continuing to infringe is legally irrelevant.”

Read more here about the Ticketmaster suit.

Ticketmaster issued a statement praising the ruling.

“Ticketmaster is committed to ensuring that consumers have fair and equitable access to tickets. Not only are we doing everything possible to create a secure and positive experience for ticket purchasers, we are making sure that the public knows it can come to the Ticketmaster Web site and access the best available seats at the prices set by the event provider,” said Ticketmaster President and CEO Sean Moriarty. “We will not allow others to illegally divert tickets away from fans. We recognize and respect the necessity and reality of a vibrant resale market, but we will not tolerate those who seek an unfair advantage through the use of automated programs.”

David Tarlow, an attorney for RMG, disagreed with the judge that there had been a copyright violation and specifically took exception to the conclusion that his clients product was automated, which is one of the laws requirements, because it requires extensive human interaction.

He said oral argument before Collins Oct. 15 didnt make much difference, as the judge had already printed out copies of her 32-page ruling before the arguments began. “There wasnt really much discussion,” he said.

Another attorney involved in the case, who didnt want to be identified, said Collins often prefers to make decisions based on written documents as opposed to oral arguments.

Retail Center Editor Evan Schuman can be reached at Evan.Schuman@ziffdavisenterprise.com.

Check out eWEEK.coms for the latest news, views and analysis on technologys impact on retail.