Category: stubhub

Fans Left Empty-Handed and Texas Attorney General Launches StubHub “Ghost Ticket” Investigation

For millions of soccer fans, attending a FIFA World Cup match is a dream. But for a growing number of ticket buyers, that dream has turned into a costly nightmare—and now the state of Texas is getting involved.

The Problem

It should come as a shock to no one that Texas Attorney General Ken Paxton has announced a formal investigation into StubHub over the massive number of fan complaints tied to 2026 FIFA World Cup ticket purchases. The only surprise in Paxton’s investigation is that it’s just him. Like so many other unfortunate ticket buyers before them, fans report that their tickets were either never delivered, canceled at the last minute, or were significantly inferior to what they originally paid for.

There is a fan class action case pending in New York federal court, but…The proposed class action filed by World Cup fans in the Southern District of New York will likely face an important threshold procedural issue before the merits are ever reached. As readers will recall from our coverage of the Kaiser v. StubHub case (also in SDNY), one issue to watch is whether StubHub seeks to enforce its online arbitration agreement and class-action waiver. Consumer platforms routinely invoke arbitration clauses to move disputes out of court and into individual proceedings, and StubHub may well attempt the same strategy here.

Whatever the outcome of the class action and StubHub’s challenges, that procedural defense is unavailable against a state enforcement action. A lawsuit brought by the Texas Attorney General under state consumer protection laws proceeds in court regardless of private arbitration agreements, potentially allowing public discovery, broader injunctive relief, and judicial scrutiny that individual consumer claims might never receive. This procedural distinction helps explain why state attorney general investigations can play a uniquely important role in policing mass-market online platforms, even when private class actions are already pending. And remember, Paxton has gotten over $1 billion from each of Google and Meta on privacy cases.

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At the heart of Paxton’s investigation is speculative ticketing aka “ghost tickets” — where sellers list tickets they don’t actually possess, collect payment, and then cancel orders when they can’t deliver or cover their promise to deliver tickets. This seedy practice is not new to readers and we’ve been harping on it for years.  According to Paxton’s press release, consumer complaints suggest this isn’t an isolated issue but a broader, systemic pattern.  Ya think?

“In many cases, attending a World Cup match is a once-in-a-lifetime experience,” Paxton said. “If StubHub is ghost ticketing Texans out of that experience, my office will use every tool available to hold them accountable and help fans who have been wronged.”

One Fan’s Story

Edgar Correa’s wife wanted to make his World Cup dream come true. She purchased tickets through StubHub on June 11 for the Bosnia-Switzerland match at Los Angeles Stadium on June 18. The couple booked a hotel, paid for parking, and Edgar took the day off work.

Then came the devastating message from StubHub: “Unfortunately, your order was not processed. This means the transaction was not completed and, therefore, no tickets were reserved for you.”

After scrambling, Correa managed to find replacement tickets directly through FIFA’s official platform—but they cost more and placed him at the very top of the stadium, far from the seats he’d originally paid for.

The Finger-Pointing

StubHub has blamed the cancellations on “transfer problems” tied to FIFA’s ticketing platform, stating that “the issues fans have experienced at this World Cup are largely due to performance failures in the event organizer’s own ticketing infrastructure, which has caused transfer errors across all resale platforms.”

FIFA isn’t having it. A spokesperson fired back: “The official FIFA ticketing platform for the FIFA World Cup 2026 operates reliably and at scale, as demonstrated by the more than 4.6 million spectators who have attended matches to date, with tickets purchased, delivered, resold, transferred, and successfully validated through FIFA systems.” FIFA explicitly rejected any suggestion that third-party platform failures are the result of its infrastructure.

The Industry Pushback

Paxton isn’t the only one sounding the alarm. On June 18—just days into the tournament—the National Independent Venue Association (NIVA) and Fan Alliance sent a joint letter to congressional leadership demanding a federal ban on speculative ticket sales. The letter, signed by NIVA Executive Director (and ARS panelist) Stephen Parker and Fan Alliance Executive Director Donald Cohen, includes nearly two dozen exhibits documenting first-hand fan accounts of ghost ticketing (another name for spec tickets) from just the first week of the World Cup.

The groups have been warning about this exact scenario for years. As they wrote: “We warned that consumers would purchase tickets that did not exist. We warned that families would travel thousands of miles only to discover their tickets could not be delivered. We warned that refunds would not make consumers whole after airfare, hotels, rental cars, parking, and other travel expenses. Unfortunately, every one of those warnings has become a reality on the world’s biggest sporting stage.”

Their proposed fix is aggressive. They’re asking Congress to ban ghost ticketing outright, impose price gouging caps on resale, levy fines of at least $10,000 per listing per day, and require platforms like StubHub to disclose data on fulfillment rates, refunds, and consumer complaints—information the platforms have repeatedly declined to make public.

Notably, the letter takes direct aim at the TICKET Act currently before Congress, arguing it would still permit the very ghost ticketing that’s victimizing fans right now. The groups point to states like Maryland, Minnesota, Oregon, Connecticut, and Nevada, which have already banned speculative sales and closed the loopholes that let resellers rebrand the practice as “concierge” or “ticket procurement” services (which also confused Colorado Governor Jared Polis when he vetoed a ban on spec ticking).

The letter also makes a point that often gets lost in the World Cup headlines: this same consumer harm plays out every day at independent venues, theaters, and comedy clubs across the country. Unlike FIFA or the NFL, these small businesses can’t absorb the reputational damage when fans blame the venue for a scalper’s fraud.

The Securities Question

One open question: StubHub is now a publicly traded company (NYSE: STUB) following its September 2025 IPO. If ghost ticketing cancellations represent a material volume of failed transactions—and the lawsuits and state investigations suggest they might—does StubHub face disclosure obligations around the scope of unfulfilled orders, pending litigation exposure, and potential regulatory liability? At least one investor rights firm has already flagged a lead plaintiff deadline tied to StubHub’s IPO disclosures, suggesting the securities angle may not be far behind the consumer protection one.

What You Can Do

If you purchased World Cup tickets through StubHub and didn’t receive them—or received tickets significantly different from what you paid for—the Texas Attorney General’s Consumer Protection Division is encouraging you to file a complaint.

FIFA’s own FAQ is blunt: for any ticket sold through another platform, buyers must contact that platform directly. FIFA cannot access or manage those tickets. The organization recommends buying tickets only through its official site.  Well, it’s a little late for that.

The Takeaway

The 2026 World Cup has been a spectacular global event, but the secondary ticket market has exposed serious consumer protection gaps. Whether this is a case of ghost ticketing, platform infrastructure failures, or something in between, one thing is clear: fans are paying the price. With a state attorney general now on the case, StubHub may soon face real accountability for the broken promises left in its wake.

by Trichordist Editor

@davidclowery: Written Testimony to Georgia Legislature Against StubHub’s Bill

GEORGIA HOUSE OF REPRESENTATIVES

COMMITTEE ON REGULATED INDUSTRIES

ADAM POWELL, CHAIRMAN

WRITTEN TESTIMONY OF DR. DAVID C. LOWERY ON HB 398

My name is David Lowery and I thank the Committee for allowing me to testify today on the StubHub legislation. By way of introduction, I am the founder of the musical groups Cracker and Camper Van Beethoven and a lecturer at the University of Georgia at Athens Terry College of Business.  I have filed amicus briefs in the U.S. Supreme Court in the cases of Google v. Oracle and Frank v. Gaos, testified before Congress on the topic of fair use policy[1] and I am a frequent commentator on copyright policy at the U.S. Copyright Office.  I advocate on artist rights in a variety of outlets, including founding and hosting the Artist Rights Symposium at the Terry College of Business (in its fourth year), my blog at TheTrichordist.com as well as Politico, the New York Times, Hypebot and other publications. Most notably I led the successful songwriter class action lawsuit against Spotify for failing to properly license and compensate self-published writers. Finally, I am a recipient of the National Music Council’s prestigious American Eagle Award “in recognition of his longstanding dedication to protecting the rights of music creators.” With this award I am in the company of such American music luminaries as Quincy Jones, Dizzy Gillespie and Stephen Sondheim.

In the interests of full disclosure, my wife has been a talent buyer at the iconic 40 Watt Club in Athens for many years and now works for LiveNation in a senior capacity.  My testimony today is my own based on my own experiences over many decades in the music business with my bands and my own research into ticketing.  My testimony today will focus on the effects of automated ticket scalping on Georgia’s many artists and resilient music ecosystem, but much of my concerns apply to all ticketed events from sporting events at taxpayer funded venues, to nonprofit fundraisers or even pledge drives for public broadcasting stations.

The Artist-Fan Social Contract Suffers When Bots Attack:  Artists and their fans enjoy a kind of social contract.  The vast majority of fans are small-dollar contributors that sustain their favorite artists.  Artist do not price their tickets at a face value that captures the present value of all revenue the artist will make on a single show.  Tickets are priced with the idea that the costs of sustaining the artist, paying the road crew, gasoline, sound, lights and vehicle equipment rental, housing, and promotion and marketing for an entire tour is amortized over an entire tour or leg of a tour. 

Pricing tickets must be decided so as to allow current and potentially new fans to see the band live which is the railhead of the artist-fan relationship and is one of the most delicate touch points of that relationship.  We do not want to price out loyal fans or new fans.

Ticket scalping has long been a problem that interfered with that social contract.  Like many other areas of our lives, when bots attack, humans suffer.  Companies like StubHub appear to allow or even welcome bot swarms as part of their business model and for all their Silicon Valley know-how, this Big Tech company seems to be unable to control their platform to avoid inflicting this suffering on fans and artists. 

Unlike the careful decision-making that goes into setting ticket prices for a tour in the pre-StubHub era, ticket prices set by these online market makers seem to play an arbitrage game that attempts to extract the maximum price that ticket traders are willing to pay for that one essential artist with the best seating and a well-heeled clientele, rather than the small dollar donor to the artist’s sustenance.  This arbitrage (some would say illegal market cornering) allows StubHub to free-ride on the artists reputation, marketing and other investments in their brand as well as the particular concert.

Ticket scalping has largely become another Silicon Valley racket in my view.  It is virtually impossible for artists to compete and it is impossible for all but the richest fans to get the tickets they want to see the artists they love at a price they can afford. I have come to the realization that it is impossible for artists and fans to fix the problem because it has become a free-rider problem. StubHub isn’t operating because of “fan freedom” or other feel-good bromides. They are drawn to the business for one reason.

StubHub wants to take a skim off the artist’s value and the fan’s love and enthusiasm by commoditizing this exchange at scale. StubHub’s platform is not that different than a commodities exchange; the good could be a Cracker show, a Bulldog’s football game, or a pork belly.  StubHub doesn’t seem to care; they do it for the money and just for the money.

Is StubHub Selling Securities as an Unlicensed Broker Dealer in Violation of the General Solicitation Rule?  I call the Committee’s attention to a phenomenon I discovered in my research for today’s hearing: StubHub appears to be making a market in selling opportunities to buy tickets, i.e., a commodity, that have yet to go on sale. In other words, StubHub appears to be selling an option to buy a ticket in the future that does not yet exist and that the seller doesn’t own. The careful wording of their boilerplate disclaimers is a little too clever, and suggests they are aware of this practice. (Please see Exhibit A that details the author’s purchase of what appears to be the promised delivery of a ticket in the future, rather than the purchase of an already existing ticket).

This practice appears to be selling an option to buy a commodity in the future by an unlicensed broker dealer in a general solicitation to the public without complying with applicable federal or state securities laws.

Paying it Forward: Resale Royalties for Scalpers:  StubHub may refuse to police itself but the State of Georgia can recover some of the value of StubHub’s free riding by establishing a resale royalty to be distributed to artists and venues for transactions occurring in Georgia. California already has a similar law on the resale of fine art. This is a very intriguing idea that would essentially force scalpers to return some of the value they have extracted from the artist’s brand to the state in which the transaction took place. I speak of the resale royalty as returned to artists and venues, but I am program-agnostic. The payment should also be returned to the performers, universities, or taxpayer funded venues around the state.

The resale royalty could be a way to continue to support communities that were hard hit by COVID and venues that survived based on the Save Our Stages funding.  It would be better to fund this support from parasitic free riders than from hard working Georgia taxpayers.

Anticorruption Protections:  When observing the amount of money and the number of high value transactions fixed by StubHub and other online marketplaces—effectively in cash—I am struck by the potential for bad actors to use the platform to hide cash transfers.  I see no reason why StubHub should be treated differently than a bank in reporting these transactions to authorities such as the Georgia Bureau of Investigation or the Department of Revenue.

I would encourage the Committee to work with these agencies to determine the need for more detailed reporting of the origin and destination of higher dollar transactions, such as $10,000 in a single deal or series of deals closed by StubHub and its progeny. It is also apparent that the Georgia Department of Revenue is not likely receiving proper short term capital gains reporting from StubHub.

Conclusion:  If this seems that these recommendations seem to advance the heavy hand of government, I will dispute that—these recommendations allow StubHub an opportunity to fix its own wagon.  As Judge Patel told Napster in 2001, you created this monster, now you fix it. Further as StubHub has come before this august body to urge legislation that would regulate the practices of its market competitors, artists and venues it’s only fair that StubHub receive the same treatment.

[1] See The Scope of Fair Use: Hearing before the Subcomm. on the Courts, Intellectual Property and the Internet of the H. Comm. on the Judiciary, 113th Cong. (Jan. 28, 2014) (statement of David Lowery) [hereinafter Scope of Fair Use].

by Trichordist Editor