Newly Enacted Law Removes Maximum Price Restriction on Sales of Admission Tickets to Entertainment Facilities

New Jersey Legislation: The New Jersey legislature recently enacted a statute which removes the maximum price limitation on sales of tickets for admission to various places of entertainment. Under the law, a “place of entertainment” is defined as any privately or publicly owned and operated entertainment facility, such as a theatre, stadium, museum, arena, racetrack or other place where performances, concerts, exhibits, games or contests are held.

Prior to the passage of the law, individuals were restricted from reselling tickets for admission to places of entertainment in excess of 20% of the ticket price or $3.00, whichever was greater, plus lawful taxes. Registered ticket brokers and season ticket holders were allowed to resell tickets at a premium, but only up to 50% of the price they paid to acquire the ticket, plus lawful taxes. The newly enacted law lifts all caps on the price for the resale or purchase of a ticket sold by a person other than a registered ticket broker, as long as the sale is made through an Internet website. The law also removes the prior statutory provision requiring that the face of each ticket include language indicating the maximum premium at which that ticket may be resold.

The legislative intent behind the law is to level the playing field for New Jersey citizens seeking to dispose of extra tickets that would otherwise remain unused, thus allowing for the public to lawfully sell tickets on eBay, Craigslist and other similar websites. The effect, however, will likely be to open, or re-open, a large area of commerce for professional “scalpers” or other professional bona fide online ticket resellers. Indeed, it may very well result in professional ticket resellers buying up so many blocks of tickets that the average member of the public will have trouble obtaining them directly from the box office where the performance is being held. On the positive side, however, the legislature noted that the previous price restrictions that were in place prior to the passage of this law put New Jersey residents at an unfair disadvantage when competing with sellers from other states who are not restricted by price caps on tickets resold via the Internet. This law would presumably help overcome that disadvantage.

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