This document was created for the purpose of assessment for Diploma of Events Management at Southbank Institute of Technology in 2008.

1. The Big, Big
Scalping Fiasco
eBay International AG
v
Creative Festival Entertainment Pty
Limited

2. The Case
 18th December 2006, eBay took Big Day
Out promoters Creative Festival
Entertainment to the Federal Court
 eBay claimed CFE were in breach of the
Trade Practices Act 1974 (Cth)

3. The Clause
‘Should this ticket be re-sold for profit it will be
cancelled and the holder will be refused
entry. This condition specifically prohibits
ticket re-sale through online market or
auction sites.’
(AustLII, 2008)

4. The Clause
 (a) scalped tickets would be cancelled;
 (b) holders of these tickets would be refused
entry;
 (c) CFE was able to detect and cancel every
scalped ticket possible
 (d) CFE was able to refuse entry to these ticket
holders;
 (e) CFE was entitled to enforce the provisions of
‘clause 6’ of the ticket conditions in all cases;

5. Trade Practices Act 1974 (Cth)
 S 51A(1)
“…where a corporation makes a representation with respect to
any future matter (including the doing of, or the refusing to
do, any act) and the corporation does not have reasonable
grounds for making the representation, the representation
shall be taken to be misleading.”
 S 52(1)
“A corporation shall not, in trade or commerce, engage in
conduct that is misleading or deceptive or is likely to mislead
or deceive.”
(AustLII, 2008)

6. The Clause
‘Should this ticket be re-sold for profit it will be
cancelled and the holder will be refused
entry. This condition specifically prohibits
ticket re-sale through online market or
auction sites.’
(AustLII, 2008)

7. The Case
 eBay claimed:
 CFE did not have right to cancel tickets, nor power to
detect scalped tickets as claimed on tickets.
 no consideration due to ‘unlimited power’ of CFE.
 no contract until ticket holder at the gate hence limited
power to detect, cancel and make void scalped tickets.
 CFE claimed:
 consideration between ticket holder and CFE was the
terms and conditions on the ticket.
 eBay encourages scalping of tickets for profit

8. The Result
 CFE was found to be wrongfully implying
that:
 they were able to detect and cancel every
scalped ticket possible
 they were able to refuse entry to these ticket
holders, and
 they were able to enforce the conditions in all
cases
 Most tickets sold on eBay are scalped

9. Consequences
 Negative press for both companies.
 CFE incurred eBay’s and their own legal
fees.
 BDO 2007 attendance rates unaffected.
 Likely “tighter restrictions on the way tickets
are sold in the future.” (ABC, 2006)
 Increased research into selling methods

10. Consequences
 eBay-sold tickets remain legal despite
some state legislation banning scalping.
 Legal loophole – Internet seen as above
the law through unenforceable clauses and
lack of legislation

11. Prevention Measures
 Identification of ticket holder to go onto
ticket, i.e. names, fingerprints.
 Tougher limits to ticket purchases per
person.
 Such clauses should not be present unless
legal authority has been fully asserted.
 Federal anti-scalping legislation.

12. Final Word
 “This ticket may not, without the prior consent of
the promoter, be resold or offered for resale at a
premium over the face value of the ticket
(including via on-line auction sites) … If a ticket is
sold or used in breach of this condition, the
promoter reserves the right to cancel the ticket
without a refund… [and] refuse a ticket holder
admission to the event or to evict that person from
the event.”
(Studioexit, 2007)