Law360 (May 27, 2020, 6:33 PM EDT) -- Miami's Ultra Music Festival is the latest event to get sued over its refusal to refund tickets following the cancellation of its March 2020 event due to the COVID-19 pandemic, with a proposed class action filed by two ticketholders in Florida federal court.
Miami resident Samuel Hernandez and Washington state resident Richard Montoure accused Ultra Enterprises Inc. of conversion and unjust enrichment in a 15-page complaint filed Tuesday. They claim the festival organizer's insistence that ticketholders transfer their tickets to either the 2021 or 2022 events is based on impermissible ticket contract terms.
"We understand that the COVID-19 pandemic has seriously impacted the global economy, but that does not give the Ultra Music Festival the right to shift the burden of this extraordinary crisis onto its customers, who, in some cases, paid thousands of dollars to attend this now canceled festival. We look forward to working to recover cash refunds for our ticketholder clients and class members," said Bryan Clobes of Cafferty Clobes Meriwether & Sprengel LLP.
The annual electronic music festival, which was scheduled for March 20-22 in downtown Miami, was postponed about two weeks before the event was to take place as the city grew concerned over the spread of the new coronavirus.
Hernandez and Montoure both allege that on March 9 they received emails from Ultra informing them that the 2020 festival was canceled and that they could "transfer" their tickets to either the 2021 or 2022 festivals. The company said they had 30 days to decide, although that deadline has since been extended multiple times, according to the complaint.
Both ticketholders said they were unable to find a phone number to call the Hialeah, Florida-based organizer and sent an email requesting refunds — Hernandez sought refunds on four of six tickets he bought for a total of $3,000, while Montoure wanted a refund of two three-day passes he bought for about $1,000. The company did not respond to the refund requests and instead repeated its directions to fill out the form attached to the previous email.
To avoid possibly losing the entire value of their purchases, both Hernandez and Montoure filled out the forms to claim their "benefits" before filing their suit, they said.
In ticketing terms and conditions that Ultra requires consumers to accept, it says the company "may, in its sole and absolute discretion elect to either issue a full or partial refund to purchaser, not issue any refunds, or reschedule the event," and that purchasers will not be entitled to a refund if Ultra decides to reschedule the event for a future date, according to the complaint.
The ticketholders argue that with these assertions that it is reserving the right to retain the money paid for tickets regardless of whether it puts on the show, Ultra is "essentially (and impermissibly) rendering its obligations under the [terms and conditions] illusory and the agreement itself an unenforceable unilateral option contract."
They also allege that Ultra made the entirety of the terms and conditions illusory and void by purporting to reserve the right to change the terms without advanced notice to purchasers.
Hernandez and Montoure are seeking to represent a nationwide class covering everyone who purchased tickets to the 2020 Ultra Music Festival, which they project could number in the hundreds of thousands, or alternatively state subclasses covering purchasers who live in Florida and Washington.
The suit is not the first of its kind to arise from the disruption of the COVID-19 pandemic. In April, Do Lab Inc., the organizer of the Lightning in a Bottle Festival, another electronic dance music festival, was hit with two putative class actions in California federal court for refusing to refund ticket fees after canceling its event.
And disgruntled ticket holders filed suit in Texas federal court against the organizers of the Austin-based South by Southwest festival, which features conferences and shows across a range of media, over ticket refund refusals.
Ultra did not immediately respond to a request for comment Wednesday.
The ticketholders are represented by Adam M. Schachter and Andrew J. Fuller of Gelber Schachter & Greenberg PA, Bryan L. Clobes and Daniel O. Herrera of Cafferty Clobes Meriwether & Sprengel LLP and Joseph G. Sauder of Sauder Schelkopf LLC.
Counsel information for Ultra was not immediately available.
The case is Hernandez et al. v. Ultra Enterprises Inc., case number 1:20-cv-22185, in the U.S. District Court for the Southern District of Florida.
--Additional reporting by Craig Clough and Lauren Berg. Editing by Jay Jackson Jr.
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