House Democrats are investigating StubHub CEO Eric Baker over revelations that the manager can be operating a separate ticket broker service on the platform, citing concerns that Baker can have “engaged in market manipulation and self-dealing on the expense of consumers.”
In a letter addressed to Baker on Friday, Rep. Robert Garcia, Rating Member on the U.S. House Committee on Oversight and Government Reform, told the manager that “Oversight Democrats are investigating whether you will have manipulated markets for your personal profit, while Americans are left paying higher costs in an unfair system.”
“Reports suggest that you will have financed and profited from the very scalpers which can be locking fans out of reasonably priced ticket sales in the primary place, and that you simply are further ripping off consumers and smaller sellers by giving yourself preferential treatment on the StubHub platform,” Garcia wrote.
Together with serving as CEO of StubHub, certainly one of the live music business’s largest ticket resale platforms, Baker also serves as a co-owner and managing director of Andro Capital, a separate company that lists and resells tickets of its own on the platform. StubHub had disclosed Baker’s relationship with Andro in the corporate’s S-1 filing ahead of its IPO last yr, though it had only come under scrutiny after an investigative report from CBC news in recent weeks.
Following the report, each StubHub and Baker were hit with a category motion lawsuit over allegations of fraudulent misrepresentation and violation of state consumer protection statutes amongst other claims.
“Eric’s investment in Andro Capital has been disclosed publicly,” a StubHub spokesperson said in a press release. “Andro Capital is a separate company and is certainly one of many vendors we use. StubHub, like many firms, works with vendors to offer additional services for his or her customers, allowing the StubHub team to concentrate on its core business. This relationship with Andro Capital makes up only a small fraction of StubHub’s total revenue.”
Garcia sent a series of questions and requests for Baker on Friday, demanding Baker “detail all listing, pricing, and achievement practices StubHub has utilized to sell tickets on behalf of Andro Capital, including any way by which such practices may differ from the services StubHub provides to other ticket resellers.”
The committee has asked for response to their questions and request for documents by August 6.
The probe against Baker comes amid a very busy yr for legislative motion within the live music business. Live Nation lost its antitrust case against earlier this yr, and the corporate and the handfuls of plaintiff states await a judge’s ruling on potential remedies. Meanwhile, Vermont, Massachusetts and Washington, D.C. all announced laws prior to now month to cap how much tickets are allowed to be resold for on platforms.