Federal Judge Lets FTC’s BOTS Act Case Against Key Investment Group Move Forward

A Maryland federal judge has allowed the Federal Trade Commission’s BOTS Act enforcement case against Key Investment Group to proceed, rejecting the ticket broker’s argument that the 2016 federal ticketing law applies only to automated bots.

Chief U.S. District Judge George L. Russell III denied KIG’s motion to dismiss on April 28 (ruling embedded below), keeping alive the FTC’s claims against Key Investment Group, its affiliated companies Front Rose Tix LLC, TotalTickets.com LLC, Totally Tix LLC and WLK Investments LLC, and executives Yair D. Rozmaryn, Elan N. Rozmaryn and Taylor Kurth. The ruling does not decide liability; at this stage, the court is only assessing whether the FTC has plausibly alleged violations of the law.

The FTC sued KIG in August, alleging the Maryland-based broker used unlawful tactics to exceed Ticketmaster’s purchase limits for high-demand events, including Taylor Swift’s Eras Tour, before reselling tickets at higher prices. According to the agency, KIG and its affiliates have operated under business names including Epic Seats, TotalTickets.com and Totally Tix.

The complaint alleges the operation relied on thousands of Ticketmaster accounts — including fictitious and third-party accounts — as well as virtual and traditional credit card numbers, proxy or spoofed IP addresses, SIM cards and SIM boxes to circumvent Ticketmaster’s safeguards. The FTC said those practices enabled the defendants to acquire at least 379,776 tickets in just over a year, at a cost of nearly $57 million, and to resell a portion of those tickets for approximately $64 million.

At the center of this week’s decision was KIG’s argument that the Better Online Ticket Sales Act — commonly known as the BOTS Act — was intended to target automated ticket-purchasing software, not coordinated, human-operated multi-account buying schemes. Russell rejected that narrow interpretation.

“15 U.S.C. § 45c does not define nor include the word ‘bots,’” Russell wrote, noting that the statute makes it unlawful for “any person” to circumvent a ticket issuer’s security measures. “The statute unambiguously applies to ‘any person’ and not just to ‘bots.’”

The court also granted a request by Sens. Marsha Blackburn and Ben Ray Luján to file an amicus brief supporting a broader reading of the law. Russell cited the senators’ view that Congress did not intend the BOTS Act to be limited to automated tools, but rather to reach scalpers who “did not play by the rules” and profited at consumers’ expense.

KIG further argued the case should be dismissed because Ticketmaster allegedly condoned or encouraged the very conduct the FTC now characterizes as unlawful. That claim carries particular significance because the FTC separately sued Live Nation and Ticketmaster in September, alleging the companies tacitly coordinated with large brokers, allowed them to exceed posted ticket limits, and then profited when those tickets were resold on Ticketmaster’s own secondary marketplace.

Russell said Ticketmaster’s enforcement practices may become relevant later in the litigation, but not at the pleading stage. “The statute’s applicability, however, does not depend on how vigorously a ticket issuer enforces its policies,” he wrote. Whether Ticketmaster “condoned or encouraged” the defendants’ conduct, Russell added, is an issue better addressed through discovery and potentially summary judgment.

That ruling preserves a central tension in the federal government’s ticketing enforcement campaign. In Maryland, the FTC alleges KIG unlawfully evaded Ticketmaster’s controls. In California, the agency contends Live Nation and Ticketmaster knew brokers were evading those same controls and nevertheless profited from the resulting resale activity. In the Live Nation/Ticketmaster case, the FTC cited internal communications, including an allegation that a senior Ticketmaster executive wrote the companies “turn a blind eye as a matter of policy” to brokers violating ticket limits and that Ticketmaster offered access to TradeDesk software to help brokers manage tickets purchased through multiple accounts.

Russell also rejected KIG’s arguments that applying the BOTS Act to non-bot conduct renders the statute unconstitutionally vague, or that the FTC’s enforcement theory violates the major questions doctrine. The court said the law provides sufficient notice of prohibited conduct and does not attempt to regulate “large swaths of the economy.”

The week was not an unqualified win for the FTC. In a companion lawsuit filed by KIG challenging the agency’s investigation and enforcement approach, Russell denied the FTC’s motion to dismiss, allowing that case to proceed as well. The court found that the pending enforcement action does not automatically bar KIG from seeking declaratory or injunctive relief, noting that a favorable outcome for KIG in the separate case could aid its defense.

CBS Baltimore reported the ruling has also drawn attention from Maryland lawmakers, who have pursued additional measures aimed at ticket scalping and resale price gouging. State Sen. Dawn Gile, sponsor of a 2025 Maryland bill on ticketing practices, told the station she hopes the FTC case will “create teeth” to deter similar conduct.

For now, both cases remain active. The defendants in the FTC action must answer the complaint, and discovery is expected to examine not only KIG’s ticket acquisition practices, but also what Ticketmaster knew, permitted or enforced as brokers used multiple accounts, proxy IP addresses and other tools to amass tickets at scale.

April 28 Ruling