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Lawyers get best seats in Ticketmaster class-action as court approves $2.4M


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Lawyers get best seats in Ticketmaster class-action as court approves $2.4M payout.

http://news.nationalpost.com/2012/07/10/2.4m-payout-for-legal-team/

Ticket resellers are colloquially called “scalpers†for profiting from the desperate, but in the case against Ticketmaster and its resale company, it is the lawyers who are making out like bandits: An Ontario court has approved a class-action settlement giving each victim $36 per ticket and $2,399,019 to their lawyers.

An Ontario Superior Court judge approved the settlement offer in a large class-action suit this week, including fees for the law firms pressing the case. The suit must still be approved by judges in Alberta, Quebec and Manitoba before the ticket agency pays the projected $5-million.

“We have shut down the scalping aspect of their business,†said Ward Branch, a Vancouver-based class-action specialist. “We want Ticketmaster to feel the sting†and send a warning to other ticket profiteers: “they’ll be next.â€

The adage that 70% of something is better than 100% of nothing really applies in class-action lawsuits

The settlement calls for the company to pay $36 for each of the 139,848 tickets bought through the company’s resale wing, TicketsNow, in the four provinces where there are anti-scalping laws.

The payout is expected to total $5,034,528 if every cheque is cashed. Lawyers at two firms specializing in class-action suits who worked on the case since 2009 will get 25% of each cheque, for a projected $1,258,632, plus $1,140,387 to cover their time and expenses.

“Fair and reasonable compensation must be sufficient to provide a real economic incentive to lawyers to take on a class proceeding and to do it well,†said Justice Paul Perell in his ruling.

“Counsel are entitled to a fair fee, which may include a premium for the risk undertaken and the result achieved, but the fees must not bring about a settlement that is in the interests of the lawyers but not in the best interests of the class members as a whole,†he said.

The plaintiffs told court they were satisfied with the arrangement.

Mr. Branch defended the lawyers’ cut, saying it is becoming a standard in class-action cases.

“The adage that 70% of something is better than 100% of nothing really applies in class-action lawsuits,†Mr. Branch said. “We agree to work for free and if we lose, we get nothing — less than nothing because we would be out of pocket.â€

An unusual clause in this settlement has the company proactively mailing cheques to those who bought inflated resale tickets without having to fill out forms and file a claim.

Our argument there is, if the ‘convenience fees’ aren’t anything to do with actual costs but just a way of charging more, then it is offside

Mr. Branch hopes the simplified process is copied in future class-action suits. The money from any cheques not cashed will be pooled and donated to charity.

The settlement is scheduled to be heard soon in Alberta, followed by Quebec and finally, on Aug. 15, in Manitoba.

“Then we want people to start looking in the mail for a cheque and let us know if it hasn’t arrived,†said Mr. Branch.

The other claim in the suit — complaints over service charges added by Ticketmaster in the primary ticket market — continues in court.

“Our argument there is, if the ‘convenience fees’ aren’t anything to do with actual costs but just a way of charging more, then it is offside,†said Mr. Branch.

Wendy Matheson, a lawyer representing Ticketmaster, declined to comment on the settlement ruling.

In 2008, Toronto consultant Henryk Krajewski tried to buy tickets online through Ticketmaster to a Smashing Pumpkins concert. The tickets had a face value of $66.50 each. The show was deemed sold out, and he was directed to the TicketsNow website where he paid $533.65, including service charges and shipping costs.

He later learned TicketsNow is a wholly-owned subsidiary of Ticketmaster and his distaste with the transaction prompted him to file a class-action suit against the companies in 2009.

Days later, Edmonton draftsman Norman Brandsma also started an action against Ticketmaster after buying tickets to shows by David Byrne and Jay Leno. A third Ticketmaster suit, by Jeffrey Dunbrack, was also brought to court and all three were consolidated into one action.

“While each of the actions is based on a different statute, the theory of the plaintiffs is the same; namely, the sale of primary and secondary market tickets to the plaintiffs and to the members of the proposed classes was contrary to the various statutes,†said Judge Perell.

The plaintiffs sought an injunction stopping the companies from resale markups and damages for unjust enrichment and conspiracy.

In April 2011, the parties began settlement discussions. By January, an agreement was reached regarding the secondary market complaints over resale by TicketsNow.

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