State sues Super Bowl broker that sold tickets it never had

Washington Attorney General Bob Ferguson is suing a New York ticket broker for what the suit calls “unfair” and “deceptive’’ practices leading up to last month’s Super Bowl.

The lawsuit against SBTickets.com of Melville, N.Y., says the company failed to deliver on 60 tickets it had sold to Washington residents for a combined $149,000, leaving fans unable to attend the game after they’d spent considerable money traveling to Arizona. SBTickets is accused in the suit of failing to tell customers it was engaging in “short selling,” meaning it didn’t actually possess the tickets it sold as guaranteedon its website.

Ferguson said Wednesday that his office had received 120 formal complaints against 35 companies related to Super Bowl ticket short selling. SBTickets topped the list with 24 complaints.

Ferguson didn’t mince words when asked at a downtown news conference whether he felt SBTickets and other short-selling brokers were “scammers” for not delivering promised seats.

“Oh yeah, absolutely,” he said. “Scammers, cheaters, stealers, you name it. Are you kidding? Absolutely.”

The lawsuit seeks $2,000 in penalties for each “violation” of the Consumer Protection Act — which could include multiple infractions per ticket order — with any money awarded going to the state’s general fund. The suit also seeks compensation for ticket buyers covering their costs for flights, hotels and other expenses in Arizona, as well as a permanent injunction preventing SBTickets from continuing to engage in the practices described.

Ferguson’s move follows a class-action lawsuit filed late last week by Seattle law firm Keller Rohrback, alleging fraudulent and deceptive practices by SBTickets and its owner, Paul Jones.

If the court approves class-action status, industry sources say the suit could ultimately involve more than 100 people from around the world who were denied seats they’d bought via SBTickets. David Ko, a lead attorney on that suit — the first such action filed in the U.S. after the Super Bowl short-sale debacle — declined to speculate how many were affected.

Short-selling brokers sell Super Bowl tickets before actually having them in hand, then try to buy them the week before the game when street prices tend to drop. The brokers use the cheaper tickets to fill their orders and profit on the difference.

But this year, ticket prices soared above $10,000 and never really fell. That forced brokers to cancel their orders for hundreds, possibly thousands of people, or endure losses of thousands of dollars per ticket to honor deals.

Both lawsuits hinge largely on guarantees made by SBTickets, on its website and in emails to customers, that purchased tickets would be delivered in Arizona.

One claim on the website, mentioned in both lawsuits, states: “Our orders are 100% Guaranteed, No tricks or gimmicks, For the unforeseen circumstances, you will get your tickets one way or another, Guaranteed!”

Both lawsuits also mention an email sent by SBTickets owner Jones to customers just three days before the game, advising of a change in the ticket-pickup location and date. The email adds: “Please rest assured that having chosen SBTickets as your Super Bowl ticket provider, your ticket(s) are guaranteed and waiting to get you into the Big Game.’’

But by Saturday, the day before the game, Jones had emailed customers warning he did not have enough tickets for every customer. He said he would honor whatever purchases he could, in the order they were made.

Both lawsuits say that SBTickets instead distributed tickets based on whoever had paid the highest price. Those who didn’t receive tickets were refunded their purchase price.

Attempts to reach Jones were referred to a New York attorney, Mark Heller, who said Jones had not received his full ticket order from suppliers. Heller denied Jones had sold his restricted inventory to those paying the most.

“Mr. Jones at all times worked in good faith,’’ Heller said. “He honestly sought to fulfill the orders and when he was unable to, he let everybody know immediately. He literally worked around the clock to make sure everyone got their refunds.’’

But both lawsuits say the refunds didn’t go far enough, given that customers endured hefty additional costs getting to Arizona. The suits demand compensation for those costs — an idea Heller dismissed.

“I don’t see that as being recoverable,’’ he said. “You purchase something, you don’t get it, you get your money back. That’s the extent of it.”

The Keller Rohrback suit, filed in Arizona, mentions SBTickets customers who had flown in not only from Seattle but Brazil, The Netherlands, Australia and even Papua, New Guinea, and were now out thousands of dollars.

Seattle resident Lisa Sterritt, 51, whose husband, Brent, is one of five named plaintiffs in the class-action suit, said they had picked SBTickets over other brokers because of its guarantees. She says it wasn’t until the day before the game that they learned their two tickets — costing $4,000 — might not be delivered.

They got final word while driving to the University of Phoenix Stadium the morning of the game.

“I was completely flabbergasted,’’ Sterritt said. “Both of us were. Everywhere we looked on the website … there was a guarantee, no matter what, that you were going to get your tickets.”

Sterritt said she was fortunate in that they stayed with family in Phoenix and didn’t incur hotel costs in addition to airfare. Staying with family, she said, was the only way they could afford to attend the Super Bowl, meaning they might never again get that chance.

“This was really ‘bucket list’ for us,’’ she said. “That’s what makes this so disappointing.’’

The AG’s lawsuit said buyers should have been told at the point of purchase that SBTickets was short-selling seats it didn’t yet have.

“It is an unfair and deceptive practice to misrepresent that persons are guaranteed to get a ticket when that was not true,” the lawsuit states. “It is an unfair and deceptive act or practice to sell a futures contract without clearly and conspicuously disclosing that the tickets or other items purchased may not be available.”

Ferguson said his office continues to investigate short-selling cases involving other brokers and that consumers who believe they were wronged shouldn’t hesitate to file complaints.

To file a complaint about a ticket broker, visit www.atg.wa.gov and click the “Consumer Complaint” button, or call 1-800-551-4636 between 10 a.m. and 3 p.m., Monday through Friday.

“The Super Bowl is a game; we get that,’’ Ferguson said. “But the experience is an experience that’s once in a lifetime … and that’s what they were cheating those folks out of in addition to the money. And in my view, that makes it especially egregious.’’