California Attorney General Rob Bonta announced today a settlement with ticket reseller StubHub, Inc. over the company's failure to provide timely refunds to consumers for canceled events during the COVID-19 pandemic. The resolution follows an investigation by the California Department of Justice into StubHub's practices.
Initially, StubHub failed to honor its advertised policy of providing full cash refunds for canceled events, instead offering consumers credit for future purchases. In May 2021, after the investigation commenced, StubHub reversed this decision and began issuing cash refunds.
The settlement, approved in Los Angeles Superior Court, includes injunctive terms for future ticket sales by StubHub and a $295,000 penalty. It also confirms that more than $20 million in cash refunds have been provided to over 45,000 California consumers.
"By failing to issue full cash refunds for canceled events during the pandemic, StubHub not only violated its advertised policy but also violated the trust of its consumers," said Attorney General Bonta. "My office proudly works to keep California consumers safe from false or misleading business practices."
StubHub operates one of the largest online ticket reselling marketplaces and had long advertised its “FanProtect Guarantee,” promising full refunds for canceled events. However, in March 2020, amid widespread event cancellations due to COVID-19, StubHub altered its policy to offer 120% credit instead of cash refunds.
The complaint alleges that StubHub violated California’s Unfair Competition Law (UCL) and False Advertising Law by misleading consumers who relied on the original refund policy when purchasing tickets before March 2020.
In addition to consumer restitution and penalties under UCL, StubHub must comply with significant injunctive terms ensuring adherence to consumer protection laws. This includes prohibiting misrepresentations regarding refund policies unless modified with informed consumer consent.
California law mandates that ticket sellers provide full refunds within 30 days for any canceled event as of January 1, 2022. For postponed or rescheduled events at the same time and place, a refund must be provided upon request within 30 days.
Attorney General Bonta emphasized his commitment to protecting consumers from unlawful business practices. Recently enacted Senate Bill 478 prohibits businesses from advertising prices excluding mandatory fees or charges. Additionally, settlements with wireless carriers and funeral service providers were announced earlier this year following investigations into deceptive advertising practices.