StubHub must pay more than $16 million in legal damages after a jury ruled that the ticketing giant intentionally sabotaged a smaller company's lucrative concierge partnership with American Express.
After a month-long trial, a Los Angeles jury on Friday (May 24) sided with Spotlight Ticket Management — a tech startup sued over allegations that StubHub failed to pay Spotlight millions in commissions and then used false statements to “poison” the company's relationship with Amex.
Until the trial, StubHub had argued that it had paid Spotlight what it owed and that the smaller company had killed its Amex deal by being an “unreasonable partner” with the financial giant: “The real cause of Spotlight's demise was the same Spotlight. ”
But in Friday's verdict, jurors found Spotlight on both counts. They ordered StubHub to pay $3 million in fees. $5.3 million in money lost from the termination of the partnership with Amex. and another $8.1 million they said Spotlight would have earned from Amex in the future.
StubHub did not immediately return a request for comment. Amex was not named as a defendant in the case or accused of any wrongdoing. In a statement, Spotlight called the verdict “a victory for Spotlight, for partners more broadly and for ticket buyers across the country.”
Spotlight started in 2007 and offers ticket management software to help companies provide access to events for their employees or customers. One of its major customers was Amex, which used Spotlight as part of its concierge system to buy concert and sports tickets for premium cardholders.
In its lawsuit, Spotlight claimed it had successfully partnered with StubHub for years, sending up to $85 million in ticket sales to the company's platform and receiving a 7% commission on those sales.
But starting in 2016, Spotlight claimed StubHub began submitting those commissions. And when the smaller company filed the dispute, it alleged that StubHub retaliated against its relationship with Amex with false and disparaging claims.
“StubHub gave Amex an 'ultimatum' that it could not work with Spotlight for these reasons, and Amex would lose access to StubHub's entire ticket inventory, crushing the availability of aftermarket tickets for the Amex Concierge program by overnight unless Amex gets rid of Spotlight. “, the company's lawyers wrote in a preliminary investigation.
StubHub strongly disagreed. In its own filings, the company claimed it had paid Spotlight all commissions actually owed to it under its affiliate program. And he said the smaller company had “damaged its own relationship with Amex” through “erratic behaviour”.
“Spotlight has taken a modest dispute over the payment of affiliate commissions and spun it into a conspiracy web to support its claim for hundreds of millions of dollars,” StubHub's lawyers wrote. “Amex witnesses testified that they decided not to renew based on Spotlight's unreasonable demands and that StubHub had nothing to do with Amex's decision.”
But after a three-week trial, jurors believed Spotlight's version of the facts, finding StubHub liable for breach of contract for the unpaid commissions as well as for intentional interference with contract and intentional interference with future economic relations regarding the Amex partnership .
StubHub may appeal the verdict, first asking the judge to order a new trial and then taking the case to a California appeals court.
