StubHub, Affiliate System Sued by Client Alleging Fraud

Secondary ticketing site StubHub has just been named in a lawsuit by Spotlight Ticket Management, which alleges that StubHub has violated federal and state law by underreporting commissionable transactions.

Spotlight, which licenses software and ticket platforms used by American Express, alleged StubHub and Awin Inc., known as Awin Global Affiliate Network, for common fraud, tortious interference, violation of the Federal RICO statue, breach of contract, unjust enrichment, and violation of California law.

The company filed a complaint against the secondary site in the U.S. District Court for the Central District of California West Division, Legal Newsline reports, alleging that StubHub has been involved in a “years-long campaign” to “under report and misrepresent commissionable transactions” owed to its affiliate network. Spotlight claims that it directed more than $84 million in sales to StubHub and the secondary sites allegedly interfered with its contract with American Express.

“However, through a pattern of conduct, first involving its internal team and later through its external business partner Awin, StubHub defrauded Spotlight and other members of its affiliate program in order to drive StubHub’s sales while underreporting sales and underpaying commissions, and then engaging in retaliatory conduct towards Spotlight when Spotlight sought to correct this wrong,” the suit said.

TicketNews reached out to StubHub for a comment but did not receive a response by publishing time.

Ann Mortimer and Jason Kim of Hunton Andrews Kurth LLP in Los Angeles. Spotlight is seeking damages, a trial by jury, and all other just relief.

This news follows Viagogo’s recent purchase of StubHub from eBay for $4.05 billion. The deal, which had been rumored for months, is under scrutiny. FanFair Alliance filed a complaint against the merger, noting that the acquisition would give Viagogo a monopoly on the secondary ticketing in the U.K. The CMA announced that it would be investigating the proposed sale and see if the deal would lead to a “lessening of competition” in the ticketing industry.