The organisers of two US festivals have filed legal action in relation to the recent collapse of ticketing business Lyte. The lawsuits provide some insight into the current state of affairs at the Lyte company, and also about how some promoters were using the ticketing platform to implement a cross between secondary ticketing and dynamic pricing.
According to Billboard, the promoter of Ohio’s Lost Lands Music Festival worked with AEG Presents, which discovered that Lyte founder and CEO Ant Taylor had resigned on 12 Sep and that the ticketing company had “ceased virtually all of its business operations and laid off virtually all of its employees”.
AEG execs then made contact with Lyte CFO Lisa Bashi two days later. According to the festival’s legal filing, “she could not commit to the timing of any payment or even that there would be a payment” of money owed from sales of tickets to the festival on the Lyte platform.
Bashi also revealed that an outside company was being hired “to help consult on how to wind down operations, making it clear that defendant had become insolvent”.
Lost Lands says it is owed $330,000 by the ticketing company. Last week it secured a ‘writ of attachment’ through the LA courts, which is a court order allowing it to seize Lyte’s property, despite no judgement having been reached in its litigation, because of concerns about the ticketing company’s ability to pay any future damages that may be due. Given the revelations about Lyte in the legal filing, other creditors may now follow suit.
The promoter of Chicago’s North Coast Music Festival has filed a lawsuit in New York, claiming it is owed more than $350,000. Its legal filing also describes how the festival used Lyte’s platform. Basically, fans could officially resell tickets for the festival via Lyte, but the promoter was also providing tickets directly to the ticketing company that were then advertised in the same resale marketplace.
According to legal filings, all but 89 of the 3064 tickets for the North Coast Music Festival on Lyte’s platform came from the promoter. The prices for those tickets then went up and down with demand, which means the resale marketplace was being used to facilitate dynamic pricing of those tickets.
The face value of the tickets directly provided by the promoter was around $287,750 and they sold for about $426,900. The promoter and Lyte were meant to split the mark-up 50/50. However, the promoter is yet to receive any money from those ticket sales.
It is not yet clear how many promoters will be impacted by the collapse of Lyte. The ticketing platform went offline earlier this month with its website stating “we'll be right back” ever since.
UPDATE 30 Sep 2024:
Both of the festivals that have sued Lyte have issued statements clarifying how they utilised the collapsed ticketing company’s secondary ticketing marketplace, insisting they were not touting their own tickets for profit. Read the latest Lyte updates here.