By Chris Castle

Yes, it’s kismet in the legislature–the sketchy ticket resellers are redoubling their efforts to normalize “speculative tickets.” They have found a willing partner in gaslighting with an organization called “ALEC”.

The American Legislative Exchange Council (hence “ALEC“) is a nonprofit organization that brings together private sector representatives and relatively conservative state legislators to draft (and pass) “model legislation” that pushes a particular narrative. (That private sector representation is led by Netchoice, aka, Big Tech.) Unlike other model legislation with a social benefit like say the Uniform Partnership Act, ALEC’s “model legislation” pushes a particular agenda. Examples would be “stand your ground” gun laws, Voter ID laws, and “right to work” laws.

ALEC’s many successfully-passed “model” laws are intended to be passed by state legislatures as-written. Like Al Capone’s green beer, it ain’t meant to be good it’s meant to be drunk. A cynic–not mentioning the names of any particular cynics–might say that the ALEC strategy is an end-run around federal legislation (like the fake library legislation that was shot down in New York). If ALEC can get a critical mass of states to pass one of their “model bills” as-drafted on any particular subject, then the need for federal legislation on that topic may become more muted. In fact, if federal legislation becomes inevitable, the ALEC model bills then provide guidance for federal legislation, or new federal legislation has to draft around the states that adopt the model bill.

So much for Justice Louis Brandeis’ concept of states as laboratories of democracy (New State Ice Co. v. Liebmann, 285 U.S. 262 (1932)), unless that lab belongs to Dr. Frankenstein. ALEC’s mission claims to promote principles of limited government, free markets, and federalism; I will leave you to decide if it’s more about checkbook federalism.

Like so many of these bills, ALEC’s Live Event Ticketing Consumer Protection & Reform Act disguises its true objective with a bunch of gaslighting bromides that they evidently believe to be persuasive and then when you’re not looking they slip in the knife. Then when the knife is protruding from your back you discover the true purpose. I think this section of the bill is the true purpose:

This is an odd construct. The model bill starts out by requiring positive behavior of a primary seller (which would be the band on fan club sales or other direct to fan sales). That positive behavior immediately turns to using the ticket purchaser into an enforcer of the values beneficial to the ticket reseller. This is done by forcing a purchaser to be able to resell their ticket without regard to any restrictions placed on reselling by the artist. 

And you know that’s the intention because the section also requires there to be no maximum or minimum price. While the model bill doesn’t require any particular restriction on the platforms, it has enough in it that it can look like a consumer protection bill, but what it is really doing and apparently was designed to accomplish is eliminate an artist’s a ability to set prices.

ALEC is serious about violations of the act, including civil penalties. Their model ticketing legislation can be enforced by both the Federal Trade Commission and state attorneys general. Penalties can include fines of up to $15,000 per day of violation and $1,000 per event ticket advertised or sold. One problem with the model bill is that it appropriates jurisdiction already available to federal agencies like the FTC which is already failing to enforce the existing BOTS Act and other property theft laws.

The main targets seem to be Stubhub’s competitors like “Primary Ticket Merchants,” These are the original sellers of event tickets, such as event organizers or venues. “Secondary Ticket Merchants” may also be prosecuted as well as individuals.

We continue to study the proposed model legislation, but I tend to agree with Stephen Parker (NIVA) and Kevin Erickson (Future of Music) on my Artist Rights Institute panel in DC yesterday. The better model bill may be their bill passed in Maryland, recently signed into law by Maryland governor Wes More.

Key differences between Maryland and the ALEC bill I could spot:

• Scope of Penalties: The Maryland bill specifies fines for speculative ticket sales, while the ALEC bill includes broader penalties for various violations.
• Refund Policies: The Maryland bill explicitly requires refunds for counterfeit tickets, canceled events, or mismatched tickets, whereas the ALEC bill focuses more on transparency and restrictive practices.
• Study on Resale Impact: The Maryland bill includes a provision for studying the impact of resale price caps, which is not present in the ALEC bill.
  
  It appears that the Live Event Ticketing Consumer Protection & Reform Act will be introduced at the ALEC meeting on December 5, 2024. This is where ALEC members, including state legislators and private sector representatives, will discuss and vote on the model policy. 
  
  Watch this space.