The Predatory Sales Tactics of StubHub
Prosecutors in Washington, D.C. have filed a lawsuit against online event platform StubHub, alleging that the company is using predatory sales tactics to deceive consumers into paying more for tickets. Attorney General Brian L. Schwalb claims that StubHub is hiding mandatory fees from consumers, leading to an increase in the total cost of tickets by up to 40%.
The Deceptive Practice of Drip Pricing
StubHub’s use of drip pricing, a tactic where companies initially set low prices but later add fees, has come under fire in the lawsuit. This practice can mislead consumers into paying more than they expected, in violation of the District of Columbia’s Consumer Protection Procedure Act. The lawsuit also alleges that StubHub fails to provide clear information about ticket fees and uses deal countdowns to create a false sense of urgency.
The Impact on Consumers and Legal Actions
Consumers often end up paying significantly more for tickets on StubHub due to hidden fees, with the Attorney General’s Office estimating that Washington, D.C. residents have paid $118 million in such fees. The office aims to stop StubHub from using these tactics and recoup the fees paid by consumers. Similar legal actions have been taken against other companies engaging in drip pricing, highlighting the detrimental impact on consumers and fair competition in the market.
Overall, the lawsuit against StubHub sheds light on the negative consequences of deceptive sales tactics and the importance of transparency in pricing for consumers. It serves as a reminder for companies to uphold ethical standards and provide clear and accurate information to their customers.
