FTC Moves For First Enforcement Of The BOTS Act

PAUL J. RICHARDS/AFP via Getty Images – FTC

Three ticket brokers in New York are being charged with using “bots,” illegal automated ticket purchasing software, to acquire tens of thousands of tickets to concerts and sporting events, and now may face a fine of more than $31 million in the first enforcement of the BOTS Act.

The case was brought against Cartisim Corp. and Simon Ebrani; Just In Time Tickets, Inc. and Evan Kohanian; and Concert Specials, Inc. and Steven Ebrani. The FTC alleges that these three used bots to illegally purchase more than 150,000 tickets and then resold the inventory for millions in revenue.

The terms of a proposed settlement were revealed by the FTC which would see the defendants paying a combined $3.7 million, as they would be unable to pay the full fine under the BOTS Act. The settlement would also prohibit the defendants from violating the BOTS Act in the future, which means they cannot exceed ticket purchasing limits, use false identities or use any bots to purchase tickets.

“These ticket brokers used bots and other technical tricks to scoop up thousands of tickets to popular events as soon as they went on sale,” Andrew M. Smith, Director of the FTC’s Bureau of Consumer Protection said in a statement. “Not only does this deprive loyal fans of the chance to see their favorite performers and shows, it is against the law.”

In late 2016 the BOTS Act was passed by Congress and signed into law by President Obama. It was created to end the use of automated software by ticket brokers to acquire huge amounts of tickets the moment they go on sale to the public, thus giving brokers disproportionate control over supply and the ability inflate prices on the secondary market.

At the time, Kansas Sen. Jerry Moran, a Republican sponsor of the bill, said the Act “levels the online playing field and makes ticket prices fairer so a greater number of everyday folks can go to that big football game, see the musical in town, or attend a concert their son or daughter is longing to see. I appreciate the support of the president and my colleagues in Congress to get this done in a bipartisan manner.”

But at an FTC Workshop on ticketing in 2019 and at a Congressional hearing in 2020 the issue of enforcement was brought up repeatedly as major players like Ticketmaster complained that even after the passage of the BOTS Act there were many, many brokers still attempting to use bots to acquire tickets and nothing was being done to deter them.

“Overall, people are not going to jail for what I would say is a significant public harm,” Joseph Ridout of Consumer Action said in 2019.