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Reseller argues ticket markups comply with law

Agency says statute lets it recover certain expenses

By Bruce Mohl
Globe Staff / February 1, 2007

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A company specializing in reselling Red Sox tickets told a Quincy District Court judge yesterday that it complied with the state's antiscalping law when it offered to sell a ticket with an $80 face value for $500 because nearly all of the markup was for legitimate expenses.

The state's antiscalping law bars licensed resellers from selling tickets for more than $2 above face value, but it allows them to charge more than that to recover certain types of expenses, including customer membership fees, some office expenses, and service charges "related to the procuring and selling of such ticket."

Admit One Ticket agency of Quincy, which operates the RedSoxTix.com website, offered to sell an $80 ticket to a 2005 Red Sox-Yankees game for $500.

According to court filings, the company believes the price complied with the antiscalping law because most of the $420 markup was for acceptable expenses. In court yesterday, Admit One lawyer Joel G. Beckman said his client does not spread its expenses equally across all the tickets it sells, but instead allocates a greater portion to tickets to the most popular events , like Red Sox-Yankees games.

Judge Mark S. Coven reacted with skepticism. He asked whether the law would be rendered meaningless if a ticket reseller could allocate expenses as it saw fit. Coven also asked Beckman if his client might allocate as much 80 percent of its expenses to the most popular games.

"Theoretically, perhaps," Beckman said.

The exchange came as Admit One and Dorchester resident Colman Herman tangled over how much Admit One should disclose about where it gets its tickets and how much it pays for them. Herman, representing himself, is suing Admit One, claiming the company violates the antiscalping law.

The case is providing a rare glimpse into the inner workings of ticket agencies at a time when state lawmakers are saying the antiscalping law is unworkable and should be revamped or scrapped. One pending bill would allow resellers like Admit One to sell tickets for three times face value.

According to court documents, Admit One generated revenue of nearly $1.8 million in 2005 and incurred expenses of $912,000, not including the acquisition cost of the tickets it resold.

The company's major expenses included a payroll of $372,000, $140,000 in legal fees, credit card fees of $84,000, Verizon charges of $60,000, shipping costs of $38,700, vehicle costs of $34,000, advertising costs of $30,000, and rent and utilities of $18,000. It also paid $98,000 to eBay, the online marketplace where Admit One sells some tickets.

Herman has asked the company to state how much it paid for the loge box seat tickets it was selling to the 2005 Yankees game and from whom they were purchased.

Beckman said yesterday that Admit One bought the tickets from another licensed reseller, whom he declined to name. He told Coven that information about the company's ticket sources was proprietary.

"If you order disclosure, you would decimate the business," he said.

Beckman said it was impossible for Admit One to say how much it paid for individual Yankees tickets because it bought season ticket packages for Fenway Park that included the Yankees games.

Admit One said it paid $135,550 in 2005 for 14 loge box seat season tickets with a face value of $90,720. The transaction netted Admit One 1,134 tickets to 81 games at an average purchase price of nearly $120. Admit One said it resold only 1,084 of those tickets for a total of $231,627, at an average price of $214.

Coven grilled Beckman about whether Admit One obtained any of its tickets from the Red Sox directly. Beckman said the tickets that are the focus of the court case were not purchased from the Red Sox, but that Admit One may purchase some tickets directly from the team. He later said about 1 percent of the company's tickets are purchased directly from the Red Sox.

A Red Sox spokesman said Admit One doesn't show up under that name on its customer lists.

Bruce Mohl can be reached at mohl@globe.com.

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