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North Carolina Supreme Court Declines to Review Communications Decency Act Immunity Ruling In StubHub's Favor

Weil, along with co-counsel Cooley Godward Kronish LLP and K&L Gates, obtained another victory for StubHub Inc. on January 25, 2013 when the North Carolina Supreme Court denied plaintiffs’ petition for discretionary review of the North Carolina Court of Appeal’s March 6, 2012 decision in favor of StubHub in the matter Hill et al v. StubHub Inc. et al. In the Court of Appeals’ March 6, 2012 order, the North Carolina Court of Appeals held that StubHub could not be held liable for the resale of allegedly overpriced Hannah Montana concert tickets by third-party sellers on its website based on federal immunity under Section 230 of the Communications Decency Act. The scope of immunity under this federal law enacted by Congress in the 1990's to facilitate the growth of the Internet and e-commerce was an issue of first impression in North Carolina and one of significance to the Internet business community.

The putative class plaintiffs had claimed they were entitled to damages because the price of the Hannah Montana tickets were in excess of the maximum resale price allowed at the time under the North Carolina’s ticket scalping statute. The trial court agreed, holding that StubHub was not entitled to immunity from liability under the Communications Decency Act because it allegedly encouraged the illegal ticket price and held further that StubHub's conduct “constituted an unfair and deceptive trade practice.” The Court of Appeals reversed the trial court’s decision and granted summary judgment for StubHub. The intermediate appellate court held that StubHub was immune under federal law because it did not "materially contribute" to the unlawful ticket price in the transaction at issue, which was set by a third-party seller. The Court of Appeals held further StubHub did not otherwise lose immunity for fees it charged for its services because it was neither the ticket seller nor the ticket seller's agent.

Weil has successfully represented StubHub in several putative consumer class actions, including cases regarding tickets to Philadelphia Phillies and New York Yankees baseball games and San Francisco 49ers football games – each of which were dismissed with prejudice at the pleading stage for failure to state a claim for relief.

The Weil litigation team on the instant action was led by partner David Lender and included partners Eric Hochstadt and Gregory Silbert, counsel Jonathan Bloom and Mark Fiore, and associate Kristen Echemendia.