Margaret Franklin-Chomas v. Internet Referral Services, LLC; Red Dog Media, Inc.; Ticket Fulfillment Services, L.P.; and Vivid Seats Inc.

Summary

The United States District Court for the Southern District of California considered defendants’ motion to compel arbitration, stay the action, or dismiss the complaint in a putative consumer class action concerning ticket-resale practices. The court compelled arbitration as to Internet Referral Services, LLC and Ticket Fulfillment Services, L.P., but denied arbitration as to Red Dog Media, Inc. and Vivid Seats Inc. The court also denied the motions to stay and dismiss, including challenges to Article III and statutory standing and the sufficiency of the consumer-protection claims.

Holdings

1. The Terms clearly and unmistakably delegated questions concerning the interpretation, applicability, and enforceability of the arbitration agreement to the arbitrator.
2. Internet Referral Services, LLC and Ticket Fulfillment Services, L.P. could enforce the arbitration agreement, including its delegation clause, and the claims against them must be arbitrated.
3. Vivid Seats Inc. failed to prove that it was a party to the Terms or was included within the defined term Vendor.
4. Vivid Seats Inc. and Red Dog Media, Inc. could not compel arbitration under equitable estoppel because Plaintiff's statutory, fraud, and unfair-competition claims were not sufficiently intertwined with the contractual obligations in the Terms.
5. Vivid Seats Inc. and Red Dog Media, Inc. could not compel arbitration under an agency theory because the record did not show the requisite control by a principal over the alleged agent.
6. Vivid Seats Inc. and Red Dog Media, Inc. could not enforce the arbitration agreement as third-party beneficiaries because the contract did not show a clear intent that they benefit from it.
7. The court denied a stay of claims against Vivid Seats Inc. and Red Dog Media, Inc.
8. Plaintiff adequately alleged Article III standing because paying more than she otherwise would have paid, or purchasing a ticket she otherwise would not have purchased, constitutes an economic injury, and a refund did not eliminate the temporary loss of use of her money.
9. Plaintiff adequately alleged statutory standing for her CLRA, UCL, and FAL claims; any mitigation or reduction of damages would not extinguish standing.
10. The court could not dismiss the consumer-protection claims based on contested Website screenshots that were outside the pleadings.
11. Plaintiff plausibly alleged that Defendants could qualify as ticket sellers because they allegedly received compensation for tickets sold through the Website, accepted payment from consumers, and delivered tickets directly to consumers.

Questions Presented

1. Whether the Terms contained a clear and unmistakable delegation of arbitrability to the arbitrator.
2. Whether Internet Referral Services, LLC and Ticket Fulfillment Services, L.P. could enforce the arbitration agreement.
3. Whether Vivid Seats Inc. and Red Dog Media, Inc., as alleged nonsignatories, could enforce the arbitration agreement under party, equitable-estoppel, agency, or third-party-beneficiary theories.
4. Whether the action should be stayed pending arbitration of claims against Internet Referral Services, LLC and Ticket Fulfillment Services, L.P.
5. Whether Plaintiff adequately alleged Article III standing despite receiving a credit-card refund.
6. Whether Plaintiff adequately stated claims under the CLRA, UCL, FAL, and California Ticket Resale Law despite Website disclaimers and the alleged refund.

Disposition

other