D.C. Attorney General Brian Schwalb announced Wednesday that he has sued Stubhub, alleging that the online ticket retailer is overcharging its customers by using deceptive pricing techniques.
StubHub hides fees from its customers until the very last moment, only revealing the much higher price after a lengthy and confusing checkout process, according to Mr. Schwalb’s lawsuit.
“This is no accident,” Mr. Schwalb said in a statement. “StubHub intentionally hides the true price to boost profits at its customers’ expense.”
The lawsuit alleges that StubHub attaches a countdown timer to certain tickets to create a sense of urgency in customers. The suit calls the process “drip pricing,” saying the company tacks on unexplained fees at the end of the purchasing process.
StubHub denied the attorney general’s allegations, saying it is transparent and its business practices are aboveboard.
“We are disappointed that the DC Attorney General is targeting StubHub when our user experience is consistent with the law, our competitors’ practices, and the broader e-commerce sector,” the company said in a statement.
The attorney general’s office says that StubHub discovered through testing that customers are more willing to pay for tickets if the advertised price does not include the exorbitant fees than if the advertised price includes all fees. The complaint claims that StubHub does not do enough to inform customers about the origin of the fees.
Mr. Schwalb also argued Wednesday that the District is especially hurt by StubHub’s business practices because city residents and tourists spend more per capita on live entertainment.
The suit comes as StubHub and other ticket retailers face security over their policies. StubHub is facing a similar class-action lawsuit from earlier this year, alleging the company intentionally misleads customers on pricing.
Additionally, Ticketmaster is facing a lawsuit by the Department of Justice, which accuses the retailer of using illegal business practices to keep a stranglehold on the industry.
• Vaughn Cockayne can be reached at vcockayne@washingtontimes.com.