StubHub and its CEO, Eric Baker, are being sued for their involvement with a hedge fund that engages in ticket scalping.
An investigation by the CBC revealed Baker is a part owner of hedge fund Andro Capital, which engages in mass reselling of tickets at a markup on StubHub. A $5 million class-action lawsuit was filed Monday by ticket buyer Louis Sanquini in response to the report.
The suit, which was filed in the Southern District of New York, argues that StubHub and Baker were not transparent about the company’s ties to a professional ticket reseller and says the company incorrectly portrays itself as a “neutral marketplace for fans to buy and sell tickets.” Sanquini said had he known about StubHub’s ties with Andro Capital that he never would have purchased tickets on the platform.
Baker disclosed his ties to Andro Capital in filings with the U.S. Securities and Exchange Commission, with StubHub found to have paid fees to the hedge fund and helped cover its ticket-management costs. The filings also revealed that StubHub has entered into agreements with Colloquy Capital, an affiliate of Andro, providing “short-term financing and referrals to other large-scale, professional ticket resellers who list tickets on StubHub.”
