House Democrats are investigating StubHub CEO Eric Baker over revelations that the CEO also ran a separate ticket broker service on the platform, citing concerns that Baker may have “engaged in market manipulation and self-dealing at the expense of consumers.”
In a letter to Baker on Friday, Rep. Robert Garcia, ranking member of the U.S. House Committee on Oversight and Government Reform, told the executive that “oversight Democrats are investigating whether you manipulated markets for your own benefit, while Americans were left paying higher costs in an unfair system.”
“Reports indicate that you have funded and benefited from scalpers who prevent fans from selling tickets at reasonable prices in the first place, and that you are further stealing from consumers and small sellers by giving yourself preferential treatment on the StubHub platform,” Garcia wrote.
Along with serving as CEO of StubHub, one of the largest ticket resale platforms in the live music industry, Baker also serves as co-owner and managing director of Andro Capital, a separate company that lists and resells its own tickets on the platform. StubHub disclosed Baker’s relationship with Andro in the company’s S-1 filing ahead of its IPO last year, though it only came under scrutiny following an investigative report from CBC News in recent weeks.
Following the report, both StubHub and Baker were hit with a class action lawsuit over allegations of fraudulent misrepresentation and violations of state consumer protection laws, among other claims.
“Eric’s investment in Andro Capital was publicly disclosed,” a StubHub spokesperson said in a statement. “Andro Capital is a separate company and is one of many vendors we use. StubHub, like many companies, works with vendors to provide additional services to their clients, allowing the StubHub team to focus on its core business. This relationship with Andro Capital makes up only a small portion of StubHub’s total revenue.”
Garcia sent a series of questions and requests to Baker on Friday, asking Baker to “detail all listing, pricing, and fulfillment practices that StubHub used to sell tickets on behalf of Andro Capital, including any way in which these practices may differ from the services StubHub provides to other ticket resellers.”
The committee requested that their questions be answered and documents requested by August 6.
The investigation against Baker comes amid a particularly busy year for legislative action in the live music industry. Live Nation lost its antitrust case against it earlier this year, and the company and dozens of plaintiff states are awaiting a judge’s ruling on potential remedies. Meanwhile, Vermont, Massachusetts and Washington, D.C., announced legislation last month to limit the number of tickets allowed to be resold on platforms.
