Flash Seats and the Cleveland Cavaliers File Joint Federal Lawsuit Against Ticketmaster Alleging Anti-Competitive and Monopolistic Practices

Lawsuit Also Claims Ticketmaster Uses Illegal Practices Preventing Fans

from Benefiting from New Technology That Ticketmaster Does Not Provide

    CLEVELAND, July 30 /PRNewswire/ -- Flash Seats and the Cleveland
 Cavaliers have filed suit against Ticketmaster, the dominant ticketing
 company in professional sports. The complaint was filed today in the U.S.
 District Court for the Northern District of Ohio. Cleveland-based Flash
 Seats, LLC and the Cleveland Cavaliers have common, though not identical,
 ownership.
     In the complaint, Flash Seats and the Cavaliers seek "to stop
 Ticketmaster's ongoing campaign to utilize its substantial market power in
 ticketing service to exclude actual and potential competition," in
 violation of federal and state antitrust laws.
     The complaint also alleges that Ticketmaster is "coercively seeking to
 enforce its primary-ticketing contracts (relating to the direct sale of
 tickets to the public) with the Cavaliers and other customers" by requiring
 them to use only Ticketmaster's own secondary-ticketing program (relating
 to the resale of tickets) or none at all. Ticketmaster does not offer a
 secondary-ticketing product with the capabilities and fan conveniences of
 Flash Seats' products and services.
     Flash Seats offers fans easy, electronically transferable, paperless
 arena access that many patrons find more advanced and convenient than
 Ticketmaster's solution, which only utilizes paper ticket entry.
     Sam Gerace, chief executive officer of Flash Seats, said, "Fans deserve
 to enjoy and benefit from a free and open marketplace. We believe fans
 suffer from less competition and less innovation due to the Ticketmaster
 business practices we address in our lawsuit. We further believe
 Ticketmaster is trying to prevent the Cavaliers and numerous other
 professional sports teams from offering their fans the ability to buy and
 sell tickets on any secondary- marketing exchange Ticketmaster does not
 own, as well as preventing fans from enjoying innovative new technology
 products that are not Ticketmaster's. We feel it is time to put a stop to
 these practices."
     "We have been focused on this issue for some time," said Len Komoroski,
 the Cleveland Cavaliers and Quicken Loans Arena president. "Our fans have
 used and enjoyed the Flash Seats service this past season, and after many
 months of discussion with Ticketmaster were unproductive, we felt compelled
 to take this action. How can Ticketmaster be allowed to prevent a team from
 offering a service to its fans that Ticketmaster itself does not offer?
 Should pro sports teams simply be limited to offering only services that
 Ticketmaster decides to offer? We think the answer to that is very clear.
 No."
     The dispute cites what Flash Seats and the team allege are
 Ticketmaster's anti-competitive efforts to interfere with the Cavaliers'
 offering to its season ticket holders one of the new and technologically
 advanced Flash Seats services. Introduced at the beginning of last season,
 Flash Seats offers season ticket holders the convenience of ticketless
 venue access, electronic transfer of tickets, and a secure, team-sanctioned
 online secondary-ticketing marketplace for transferring and selling their
 game seats electronically (and without paper) to other fans.
     Ticketmaster now contends that the Cavaliers' conduct in making Flash
 Seats available to its season ticket holders violates Ticketmaster's
 exclusive rights. Although the Cavaliers have a contract with Ticketmaster
 for the sale of individual game tickets in the primary-ticketing market,
 Komoroski said its exclusivity provision has never been applied, and was
 never intended to apply, to the secondary-ticketing market for season
 tickets or the manner in which season ticket holders transfer or resell
 their tickets to other fans.
     "The Cavaliers were the first NBA team to offer this exciting new
 technology, and their fans have been very enthusiastic about it," Gerace
 added. "It is far more convenient and fan-friendly than any other service
 on the market. Fans have flocked to this innovative service because it is
 both easier to use and adds value and significant benefit to the ticketing
 process."
     -- Flash Seats provides quick and easy access to Quicken Loans Arena
        through specially marked gates where, instead of presenting a paper
        ticket, the seat-holder presents a credit card or driver's license for
        paperless, electronic entrance.
     -- With Flash Seats, season ticket holders can transfer their electronic
        ticket(s) to family members, business associates or other parties on
        the Internet by simply entering the e-mail address of the intended
        recipient who will then electronically receive the paperless tickets.
     -- Season ticket holders also have an option to utilize an easy, secure
        secondary marketplace through Flash Seats by selling their seats at
        fair market value.  Buyers can be assured that the purchased seat is
        authentic and valid.
     -- Ticketmaster's contract with the Cavaliers prevents Flash Seats
        technology from being used for the resale of Cavaliers single-game
        tickets (tickets other than season ticket locations).
     Ticketmaster does not offer fans a paperless, electronic ticket or a
 paperless secondary marketplace. The court filing points out that
 Ticketmaster has attempted to sell the Cavaliers and other customers an
 inferior secondary- ticketing product called TeamExchange, which does not
 offer fans the same features and conveniences that Flash Seats and other
 secondary marketing exchanges offer.
 
 

SOURCE Flash Seats, LLC; the Cleveland Cavaliers