UNITED STATES DISTRICT COURTNORTHERN DISTRICT OF ILLINOISEASTERN DIVISIONANDREW DUFFY, GEORGE ADAMS,)GREGG HARDER, CHRISTOPHER)JACKMAN, JASON LEE, JOSE ORDAZ,)VINCENT RUGGIERO, and SOHAIL SHAH,)individually and on behalf of all others )similarly situated,)Plaintiffs)No. 09 C 1746)v.)Judge Rebecca R. Pallmeyer)THE TICKETRESERVE, INC., d/b/a)INC., FIRSTDIBZ.COM, an Illinois )corporation,))Defendants.)MEMORANDUM OPINION AND ORDER
Defendant The Ticket Reserve, Inc., doing business as FirstDIBZ.com, operates an “onlinemarketplace,” in which internet users can buy, sell, and trade options to purchase tickets to sportingevents, paying Defendant a fee for each transaction. Plaintiffs are customers of the onlinemarketplace who allege that they were defrauded by other users in several exchanges in which theyattempted to secure tickets to the 2009 SuperBowl. On behalf of themselves and those similarlysituated, Plaintiffs assert various fraud and breach of contract claims against Defendant, whoallegedly promised that the website was safe and secure. Defendant moves to dismiss all claims,asserting that they are barred by various provisions of the contract that Plaintiffs signed when theybegan using the website. For the reasons explained below, Defendant’s motion to dismiss isgranted in part and denied in part.
BACKGROUNDA.The Ticket Futures Market
For purposes of this motion, the court presumes that the allegations of Plaintiff's AmendedClass-Action Complaint are true. Defendant The Ticket Reserve, Inc. (“TTR” or “FirstDIBZ”) is a
Case 1:09-cv-01746 Document 59 Filed 07/06/10 Page 1 of 22
corporation organized under the laws of Illinois with its principal place of business in Illinois. TTRoperates FirstDIBZ.com, a website marketplace in which consumers may reserve advancepurchasing options for tickets to sporting events, concerts, and other occasions. (Compl. ¶ 14.)As the court understands it, the website essentially operates as a futures market for tickets;consumers may buy, sell, and trade purchasing options (dubbed “DIBZ” by the website) for futureevents on a speculative basis. According to the website’s User Agreement, “a ‘DIBZ’ is aninstrument which: (i) gives the holder the right to purchase a product or ticket to a known or possibleDIBZ event, the occurrence of which may be known or is contingent upon one or more factors and(ii) obligates the holder to purchase the product or ticket if the event is scheduled to occur.” (
Id
. at¶ 18; Ex. A to Compl. at 1.) As an example, a confident fan of the Chicago Cubs could visit thewebsite and purchase a “DIBZ” for Game 1 of the 2011 World Series at Wrigley Field. In the eventthat the Cubs overcome their decades-long World Series drought,
1
the happy fan would then beguaranteed the right to purchase the ticket for Game 1 at face value. (Compl. at ¶ 17.) Should theCubs disappoint, the DIBZ-holder would receive nothing and would lose the money she paid for theDIBZ. (
Id.
at ¶ 16.)The website offers two marketplaces in which customers may purchase DIBZ and, as theuser agreement explains, TTR’s “roles vary in each.” (
Id.
at ¶ 19; Ex. A to Compl. at 2.) The firstmarketplace, referred to as the “FirstDIBZ-supplied” or the direct marketplace, allows purchasersto buy DIBZ directly from TTR. (
Id.
) For DIBZ purchased in the direct marketplace, “[TTR] stands
1
The Cubs last appeared in the World Series in 1945. As team lore has it, duringGame 4 of that series, Cubs officials ejected fan Billy Sianis and his pet goat from Wrigley Field.Sianis, a Greek immigrant who owned a local tavern, had purchased a box seat for the goat asa publicity stunt. While Sianis and his goat initially entered the ballpark without incident, teamowner Phillip Knight Wrigley subsequently insisted upon the goat’s removal because of theanimal’s objectionable odor. As Sianis and the goat were escorted out, the furious pet ownerwas heard to mutter, “The Cubs, they ain’t gonna win no more.” The Cubs went on to lose theSeries and have not been back since. Many fans have since attributed the Cubs’ decades offutility to the “Curse of the Billy Goat.”
See, e.g.,
Steve Gatto, D
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URSE OF THE
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ILLY
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OAT
:
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HE
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HICAGO
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UBS
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ENNANT
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ACES
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URSES
(2004).2
Case 1:09-cv-01746 Document 59 Filed 07/06/10 Page 2 of 22
responsible for the authenticity of Listings registered on FirstDIBZ.” (Ex. A to Compl. at 2.) Thesecond marketplace, referred to as the “uDIBZ” or the “consumer-supplied” marketplace, givesDIBZ-holders the option of buying, trading, or selling their DIBZ in exchanges with other websiteusers. In the consumer-supplied marketplace, “FirstDIBZ acts as an exchange only in allowingusers who want to buy Listings to find Listings from registered users who want to sell Listings.” (
Id.
)Presumably, as the likelihood of a particular occurrence becomes more or less probable, the resalevalue of the DIBZ for that event would increase or decrease. Thus, if the Cubs advanced to theNational League Championship Series in 2011, a DIBZ-holder who purchased her Cubs WorldSeries DIBZ at the start of the season would be able to resell it to another Cubs fan for a substantialprofit. In this way, the website serves as a market not only for fans who genuinely wish to attendsporting events but also for speculators seeking to make money based on predictions about theoutcomes of sporting events.
2
The website generates its revenue both by selling DIBZ directly andby charging users a transaction fee for DIBZ sold or traded between users.Before they engage in any transaction on the FirstDIBZ.com website, all customers arerequired to register by submitting their credit card information and agreeing to the FirstDIBZ.comUser Agreement. (Compl. ¶ 21.) The User Agreement, as explained in more detail below, is acontract between TTR and every individual user of the website. (
Id
. at ¶ 22.) Each registered useris also provided with an “online wallet” account, in which funds representing the profits garneredby reselling DIBZ are stored. (
Id.
at ¶ 23-24.) Upon request, TTR permits customers to withdrawfunds from their online wallet accounts in the form of a check payment. (
Id.
at ¶ 25.)
B.Plaintiffs’ Contract and Fraud Claims
2
The parties have not addressed whether the service provided by FirstDIBZ.comruns afoul of either prohibitions on sports gambling or securities and exchange regulations. Forthe time being, the court assumes that the activities conducted on the site are not unlawful. Thecourt notes that Illinois has specifically exempted ticket brokers who sell tickets on properlyregistered websites from state prohibitions on ticket scalping.
See
720 ILCS 375/1.5(c);
City of Chicago v. eBay, Inc.
, No. 08 C 3281, 2009 WL 51884016, *3 (N.D.Ill. Dec. 21, 2009).3
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Duffy v. The Ticket Reserve (FirstDIBZ.com) (N.D. Ill) (July 6, 2010)
Court dismisses class action against online options marketplace for sporting event tickets, finding that the claims were barred by the website terms of use.
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