Alleged ‘Hamilton’ Ticket Scalper Escapes Claims

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By Alexis Kramer

A ticket broker escaped claims alleging its use of bots to buy up event tickets on Ticketmaster LLC’s website violated copyright law and a computer fraud statute.

Ticketmaster alleged that Prestige Entertainment Inc. used illegal software called bots to buy “tens of thousands” of tickets for the hit Broadway production “Hamilton,” as well as other live events in New York. Ticketmaster alleged that Prestige infringed its copyrighted webpages, illegally bypassed security measures, and accessed its website without authorization.

The U.S. District Court for the Central District of California dismissed the copyright infringement and unauthorized access claim. But it allowed a claim under the Digital Millennium Copyright Act’s security circumvention provision to proceed.

The decision shows the difficulties in combating and preventing the use of bots in the entertainment industry. Prestige last May agreed to pay $3.3 million for using illegal bots to resell tickets in New York, under a settlement with Attorney General Eric T. Schneiderman.

Copyright, CFAA Claims Tossed

Ticketmaster alleged that Prestige used bots to navigate its copyrighted webpages to buy tickets. The court rejected Ticketmaster’s argument that Prestige infringed upon those pages.

Computers automatically create copies of the webpages that a user views, the court said. Ticketmaster failed to show that Prestige’s “copying was anything more than the automatic background copying that occurs when users browse the internet,” the court said.

The court also rejected Ticketmaster’s claim under the Computer Fraud and Abuse Act, which prohibits the unauthorized access of a computer for purposes of obtaining information. The court looked to Facebook Inc. v. Power Ventures Inc., in which the U.S. Court of Appeals for the Ninth Circuit held that a social media aggregator ran afoul of the CFAA for accessing Facebook user data after Facebook explicitly revoked its permission to use the site.

The district court said Ticketmaster failed to show it revoked Prestige’s permission to use its site. Ticketmaster had sent Prestige a cease-and-desist letter, but the letter did no more than list alleged violations of the website’s terms of use, the court said.

The court allowed Ticketmaster’s DMCA claim to move forward because Ticketmaster sufficiently alleged Prestige circumvented CAPTCHA images and other security measures to access the copyrighted pages.

A Ticketmaster spokeswoman declined a Bloomberg Law request for comment.

Manatt Phelps and Phillips LLP represented Ticketmaster. Pryor Cashman LLP, counsel for Prestige, didn’t immediately respond to a request for comment.

The case is Ticketmaster LLC v. Prestige Entm’t, Inc. , 2018 BL 32859, C.D. Cal., No. 2:17-CV-07232-ODW (JCX), 1/31/18 .

To contact the reporter on this story: Alexis Kramer in Washington at akramer@bloomberglaw.com

To contact the editor responsible for this story: Roger Yu at ryu@bloomberglaw.com

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