By Craig Clough

Law360 (April 20, 2020, 6:57 PM EDT ) Ticketmaster and Live Nation were hit with a proposed class action in California federal court on Friday over their refund policies for events postponed due to COVID-19, alleging they are making customers eat the costs of thousands of disrupted events by retroactively changing their refund policy.

Would-be concertgoer Derek Hansen of San Francisco filed the lawsuit against Ticketmaster Entertainment Inc. and its parent Live Nation Entertainment Co. on behalf of all customers who are alleged victims of the companies' refusal to offer refunds for postponed events.

Hansen claims Ticketmaster changed its policy in March to say it will only refund canceled events, and not postponed concerts, even if the event has been indefinitely postponed, as was the case for two April Rage Against the Machine shows Hansen bought four tickets for at a total of $590. 

"Plaintiff now holds four tickets to two RATM concerts that have been effectively canceled, will almost certainly be canceled, and which he bought with a guarantee of a monetary refund for cancellation," Hansen said. "But under defendants' new, post-hoc policy revisions, he will only be provided a refund if, and when, the events are officially canceled rather than 'postponed.'"

Hansen's is the latest proposed class action filed against major corporations over COVID-19 cancellation policies, with lawsuits already having been filed against ticket resale giant StubHub, several major airlines, Six Flags Magic Mountain and others.

The lawsuit was filed on the same day Ticketmaster President Jared Smith said in a letter to Reps. Katie Porter, D-Calif., and Bill Pascrell, D-N.J., that the company intends to "refund as many tickets as possible in as timely a fashion as is feasible. We are working every day towards that goal."

Smith said that of 30,000 events impacted by COVID-19, over 12,000 have already been canceled and the company is working on refunds. Smith also said about 5,000 events have been rescheduled, and that the company is issuing refunds to customers who request them. Of the 14,000 events that have been postponed without a set rescheduled date, Smith said refunds will be offered as the events "either land new dates or are canceled."

He added, "Let me reiterate: neither our clients, nor Ticketmaster, intend to withhold refunds on postponed shows. In fact, as of today, both Live Nation Entertainment and AEG Live, two of our largest event organizers, have announced they will begin to provide refunds, on a rolling basis, for all events impacted by COVID-19."

The letter came one day after Porter and Pascrell hammered Ticketmaster and Live Nation in a letter to the companies, saying they are "incredulous at Ticketmaster's announced policy to refuse refunds to all requesting fans for ticketed events postponed by the ongoing COVID-19 pandemic. With Americans weathering the brutal and continuing impacts of this global crisis, your decision to confiscate their money is reprehensible and should be reversed immediately."

Marie McCrary of Gutride Safier LLP, who represents Hansen, said in an email to Law360 that the firm is "pleased that on the day we filed this lawsuit, Ticketmaster announced an improved refund policy for cancelled and rescheduled events. But we remain concerned that for rescheduled events Ticketmaster is still leaving the refund decision to the organizers of each event. In addition, when events are 'postponed indefinitely' without any new date set, refunds are being denied. Ticketmaster needs to offer refunds for all such events."

Hansen claims in the lawsuit that Ticketmaster and Live Nation's terms of use contain unconscionable provisions that allow the companies to change the terms at any time.

Hansen alleged that up until at least March 13 the Ticketmaster website said refunds are available for events that are postponed, rescheduled or canceled, but that the policy then changed to only cover cancellations.

"Defendants sought to retroactively change their policies for refunds for ticket sales," Hansen said. "Defendants have quietly sought to force their buyers to endure the financial losses that defendants would suffer in the entirely foreseeable scenario that world occurrences would cause the simultaneous cancellation of numerous public events."

The lawsuit seeks unspecified compensatory, statutory and punitive damages for claims including breach of contract, conversion, unjust enrichment and false advertising.

Live Nation did not immediately respond to a request for comment.

Hansen is represented by Adam J. Gutride, Seth A. Safier and Marie McCrary of Gutride Safier LLP.

Counsel information for the defendants could not immediately be determined.

The case is Derek Hansen v. Ticketmaster Entertainment Inc. et al., case number 3:20-cv-02685, in U.S. District Court for the Northern District of California.

--Editing by Daniel King.

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