The FTC has filed a lawsuit against a ticket broker operation, alleging they used “illegal means” to make millions scalping tickets for an array of events and concerts, including Taylor Swift’s Eras Tour.
The complaint accuses the Maryland-based ticket broker Key Investment Group of violating the Better Online Ticket Sales Act (BOTS Act) by circumventing Ticketmaster’s security measures to purchase more tickets than the allotted limit. These tickets, the FTC alleges, were then resold on secondary ticketing websites (including Ticketmaster’s own resale platform) often at “a significant markup to consumers.”
Along with Key Investment Group, the complaint names several affiliated companies, including Epic Seats, TotalTickets.com LLC, and Totally Tix LLC. Key Investment Group’s CEO, Yair D. Rozmaryn, CFO, Elan N. Rozmaryn, and Chief Strategic Officer, Taylor Kurth, were also named in the complaint.
The complaint alleges that between Nov. 1, 2022 and Dec. 30, 2023, the defendants bought at least 379,776 tickets for approximately $57 million. A portion was allegedly resold on secondary marketplaces for approximately $64 million.
To scoop up all those tickets, the FTC alleges that the defendants used “thousands of fictitious Ticketmaster accounts, thousands of virtual and traditional credit card numbers, proxy or spoofed IP addresses, and SIM banks to bypass or otherwise avoid security measures, access control systems, or other technological controls or measures on Ticketmaster’s websites that would have otherwise blocked or prevented them from violating Ticketmaster’s posted ticket purchase limits.”
For instance, the FTC claims that in 2023, the defendants purchased 2,280 tickets across all 38 dates of Swift’s Eras Tour (which had a six-ticket limit per person). They paid $744,970.29 for these tickets, then re-sold them for $1,961,980.65 to net $1,217,010.36. The complaint also alleges that the defendants used 277 different accounts to purchase 1,530 tickets to Bruce Springsteen’s Sept. 1, 2023 show at MetLife Stadium (which had a four-ticket limit), making over $20,000.
In a statement, FTC Chairman Andrew N. Ferguson noted the executive order President Donald Trump signed in March, which he said was meant to target “unscrupulous middlemen who harm fans and jack up prices through anticompetitive methods.” He continued: “Today’s action puts brokers on notice that the Trump-Vance FTC will police operations that unlawfully circumvent ticket sellers’ purchase limits, ensuring that consumers have an opportunity to buy tickets at fair prices.”
A representative for KIG said the FTC’s lawsuit “threatens to dismantle the secondary ticket market for live events, further consolidating power in the hands of the industry’s largest monopoly” (an ostensible reference to Live Nation and Ticketmaster, which is still facing a Department of Justice antitrust lawsuit).
“In an unprecedented move, the FTC has twisted the intent of the Better Online Ticket Sales (BOTS) Act, a law designed to target malicious software, into a weapon against legitimate businesses and consumers,” the KIG rep continued. “Under the FTC’s interpretation, anyone who purchases more than four tickets or uses more than one account could be deemed in violation of federal law. That outcome is not only illogical, it’s absurd. Even more troubling, the FTC misleadingly characterizes Key Investment Group’s use of standard internet browsers to purchase tickets as equivalent to deploying unlawful software. This portrayal is both deceptive and malicious. Key Investment Group is prepared to vigorously defend itself against this clear example of regulatory overreach.”
Late last month, KIG preemptively filed a lawsuit of its own against the FTC over its investigation. A spokesperson for the FTC declined to comment on that piece of litigation.