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StubHub Faces Class Claims over Cancellation Refund Policy

Elizabeth DiNardo, Esq. | Associate Counsel

Concert_Ticket

On April 2, 2020, event ticket sales company StubHub Inc., was served with class claims in federal court in the Western District of Wisconsin, that alleged defendant is attempting to profit from the COVID-19 pandemic by refusing to issue cash refunds to customers who purchased tickets through StubHub for events that have been cancelled due to the ongoing crisis.

Named plaintiff, Matthew McMillan, alleged that in the past, StubHub assured customers that if an event was cancelled, StubHub would refund customers the entire purchase price of the tickets—a policy known as the “FanProtect” guarantee. The plaintiff explains that the FanProtect guarantee is a policy that, pre-COVID-19 pandemic, was heavily promoted by defendant on the company’s website and in its internet advertising.  According to the complaint, the FanProtect guarantee was an alluring component of doing business with StubHub and is one of the reasons why so many customers are willing to purchase tickets from the company, in addition to paying premium prices and substantial fees directly to the defendant.

In testimony to a U.S. House of Representatives Subcommittee in February 2020, StubHub’s vice president and general counsel testified that, “StubHub’s FanProtect guarantee is the hallmark of our business and why we have earned the trust of fans around the globe.” However, just a month after the testimony was given, the COVID-19 pandemic forced events all over the globe to be cancelled.

In response to the announcement of the cancellations, StubHub initially emailed customers, stating that they “have your back.” However, on March 25, 2020, StubHub emailed customers again and alerted them that StubHub had changed the terms of the FanProtect guarantee and that as a result, “if the event is cancelled and not rescheduled, you will get a refund or credit for use on a future purchase.” The correspondence goes on to tell users that the decision of whether a customer will receive a credit or a refund will be left up to StubHub’s sole discretion, except for when a refund is required by law.

The plaintiff seeks to represent a class made up of all persons residing in the U.S. who opened StubHub accounts before October 2018 and used StubHub to purchase tickets to any event which was subsequently cancelled from March 25, 2020, until the date that notice of this class action is disseminated to the class. The suit brings causes of action for breach of contract, conversion, negligent misrepresentation, violation of Consumers Legal Remedies Act, Unlawful Business Practices and false advertising.

The case is: McMillan v. Stubhub Inc. et al, Case No.: 3:20-cv-00319, in the U.S. District Court for the Western District of Wisconsin.


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