LOS ANGELES (Legal Newsline) – StubHub is asking a federal judge to throw out a racketeering lawsuit that claims it underreports transactions on which it would need to pay commissions to members of its affiliate network.
The lawsuit was brought late last year by Spotlight, which licenses software and hosts online ticket platforms used by American Express. Stubhub has responded, saying it only pays commissions on certain eligible ticket sales.
“Because RICO claims are often misused to create the false suggestion of criminality and pose a serious risk of unfairly stigmatizing defendants, the Ninth Circuit has determined that flawed RICO claims, such as those here, should be ‘flushed out’ at the early stages of litigation,’” an April 10 motion to dismiss says.
Spotlight has claimed Stubhub interfered with its relationship with American Express, with a Stubhub employee allegedly telling an Amex employee that it was no longer able to work with Spotlight.
And adding in allegations of underpayment still doesn’t create a racketeering claim, Stubhub argues. Named as a co-defendant is Awin, which started managing the affiliate program in 2016.
Stubhub makes several technical arguments, notably that the plaintiffs can’t allege there exists an enterprise under the RICO Act.
From Legal Newsline: Reach editor John O’Brien at john.obrien@therecordinc.com.