Bill Summary – FastDemocracy

Legislative Analysis
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EVENT ONLINE TICKET SALES ACT
                                                                              http://www.house.mi.gov/hfa
House Bill 5661 (H-2) as passed by the House                                  Analysis available at
Sponsor: Rep. Mike McFall                                                     http://www.legislature.mi.gov
House Bill 5662 (H-1) as passed by the House
Sponsor: Rep. Graham Filler
Committee: Regulatory Reform
Complete to 6-28-24
SUMMARY:
       House Bill 5661 would create a new act, the Event Online Ticket Sales Act, which would
       prohibit a person (an individual or any other legal entity) from circumventing or disabling a
       security measure, access control system, or other technological control or measure used to do
       any of the following:
           • Enforce a ticket purchasing limit.
           • Enforce an electronic queue, waiting period, presale code, or other sales volume
               limitation system associated with an online ticket sale.
           • Validate that a ticket is not fraudulent.
               Ticket purchasing limit would mean the posted limit stating the number of tickets a
               person may purchase for a specific entertainment event during an online ticket sale.
               Ticket would mean a physical, electronic, or other form of a certificate, voucher,
               document, token, or other evidence indicating that the person entitled to possession
               through purchase or otherwise has a right to enter a place for an entertainment event at
               the date and time specified on the ticket.
               Entertainment event would mean a concert, theatrical performance, sporting event,
               exhibition, show, or similar scheduled activity held in Michigan that meets all of the
               following:
                   • It is open to the public.
                   • It is held in a public or private venue.
                   • It charges an admission fee to attend.
       House Bill 5662 would create a new act to prescribe sanctions for violating the Event Online
       Ticket Sales Act (HB 5661) and allow the attorney general to investigate claims of violations.
       Specifically, a person that violates the other act would be subject to a civil fine of up to $5,000
       for each ticket acquired in violation of the other act, which would be deposited into the general
       fund.
       The attorney general could bring a civil action to restrain or enjoin a person found to be in the
       process of violating the other act from continuing the violation, or to prevent a person whose
House Fiscal Agency                                                                            Page 1 of 2
           violation is found to be imminent from committing a violation. In addition, if a person has
           violated the other act, a civil action could be brought for appropriate relief, including injunctive
           relief, or to collect the civil fine described above and recover restitution.
           A person that violates a court order or injunction to enforce the other act would also be subject
           to a civil fine of up to $5,000.
           Finally, the court could allow the attorney general to recover reasonable costs and attorney fees
           incurred in an action resulting in the imposition of a civil fine under the bill.
           The bills are tie-barred together and would not take effect unless both are enacted.
BRIEF DISCUSSION:
           According to committee testimony, while the use of bots to purchase tickets is already illegal
           on the federal level, the bill is intended to give Michigan and the Department of Attorney
           General more tools to address an issue that has become pervasive in the industry. 1 Supporters
           of the bill argued that it may also boost tourism to Michigan for certain events by ensuring that
           consumers will be able to access tickets without paying exorbitant prices on the secondary
           market.
FISCAL IMPACT:
           House Bills 5661 and 5662 would result in marginal revenue increases from deposits to the
           state general fund from the collection of civil fines, of up to $5,000 per ticket, from violations
           of HB 5661. Actual revenue would depend on the number of violations, level of enforcement,
           and per-ticket fine imposed on violators. The bills would have no fiscal impact on the
           Department of Attorney General related to investigating and prosecuting violators.
POSITIONS:
           Representatives of the following entities testified in support of the bills (6-11-24):
              • Department of Attorney General
              • StubHub
                                                                      Legislative Analyst: Alex Stegbauer
                                                                         Fiscal Analysts: Robin Risko
                                                                                           Michael Cnossen
■ This analysis was prepared by nonpartisan House Fiscal Agency staff for use by House members in their
deliberations and does not constitute an official statement of legislative intent.
1
    https://www.ftc.gov/legal-library/browse/statutes/better-online-ticket-sales-act
House Fiscal Agency                              HBs 5661 (H-2) and 5662 (H-1) as passed by the House   Page 2 of 2