Wednesday, September 1, 2010
Court Allows Nationwide Class in Ticketmaster Suit
By STEVEN M. ELLIS, Staff Writer
This district’s Court of Appeal ruled yesterday that a nationwide class action alleging that Ticketmaster misled customers who used its website into believing certain charges were passed through, rather than being a profit source for the company, can go forward in the Los Angeles Superior Court.
Div. Two, in an unpublished opinion, held that Ticketmaster’s requirement that all online purchasers agree that any dispute be resolved by courts in California and governed by California law established sufficient contacts to give the Superior Court jurisdiction.
Los Angeles Superior Court Judge Kenneth R. Freeman previously ruled that only California residents could be part of the class action seeking damages under California’s Unfair Competition Law and False Advertising Law for an “Order Processing Charge” and a “UPS Delivery” fee Ticketmaster imposed.
Illinois resident Curt Schlesinger and New York resident Peter LoRe claimed that Ticketmaster’s website led customers to believe that the “Order Processing Charge” and the “UPS Delivery” fee—which carried charges ranging from $14.50 to $25 depending on the speed of delivery—were merely costs passed on to consumers. In addition to the two fees, Ticketmaster charges online consumers a “Building/Facility Charge” and a “Convenience Charge,” but allows customers the option of choosing standard U.S. Mail for delivery, which carries no additional charge.
Schlesinger and LoRe claimed they would not have purchased tickets to events in Illinois and New Jersey, or would have elected a different delivery method, had they thought the fees were sources of profit for Ticketmaster. They sought to certify a nationwide class of purchasers through the website who paid the fees from Oct. 21, 1999 onward, pointing to a choice of law provision and a forum selection clause appearing on Ticketmaster’s website.
The company argued in opposition that the UCL and FLA did not apply to claims by non-California residents. It also contended that it would be arbitrary and unfair to apply California law to claims of out-of-state class members who never went through an Internet server located in California and whose tickets were processed, shipped and paid for outside of California.
Ticketmaster, a Delaware corporation based in Los Angeles, noted that regional centers around the country handled such operations until 2005. Since that time, it added, regional centers in Illinois and California had been responsible for data storage and order processing, while tickets had been sent out from West Virginia.
Freeman certified a class consisting of customers who purchased tickets through Ticketmaster’s website from Oct. 21, 1999 through Feb. 5, 2010, but limited it to Californians. He reasoned that the plaintiffs did not present enough evidence to show jurisdiction over a nationwide class, and that Ticketmaster raised the possibility of a factual attack on jurisdiction.
On the plaintiff’s motion for a writ of mandate to the Court of Appeal, however, Justice Kathryn Doi Todd wrote that Tickemaster’s presence in California and the choice of law provision and forum selection clause gave the state sufficient contacts over all claims such that the exercise of jurisdiction in California would not offend due process.
The justice also rejected the company’s argument that non-California resident’s claims would go beyond the reach of the UCL and the FAL, pointing out that the statutes contain “no such express geographic restriction.”
Justices Judith M. Ashmann-Gerst and Victoria M. Chavez joined Doi Todd in her opinion.
Ticketmaster was represented by attorneys Frank E. Merideth Jr., Jeff E. Scott and Gregory A. Nylen of Greenberg Traurig. The plaintiffs were represented by attorneys William M. Hensley, Robert J. Stein III, Marc D. Alexander, Claire M. Schmidt and Valerie K. Brennan of international law firm Adorno Yoss, and by Steven P. Blonder of Much Shelist Denenberg Ament & Rubenstein in Chicago.
The case is Schlesinger v. Superior Court (Ticketmaster), B224880.
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