No interim injunction in Commerce Commission v Viagogo AG

Article written by: Nadia Ormiston    |    Wednesday 27th February 2019

The High Court decision in Commerce Commission v Viagogo AG [2019] NZHC 187 highlights one frustration faced by applicants when the respondent is based overseas but trading in New Zealand.


Background

Viagogo is a Swiss company that operates a ticket reselling website internationally, including in NZ. In December 2018, the Commission brought proceedings under the Fair Trading Act 1986 (FTA) alleging that:

  • Viagogo represents that tickets it sells are valid when many of the tickets it sells are invalid, including because they have already been sold or are forgeries;
  • Viagogo only shows the actual cost of the tickets (with fees) at a very late stage in the buying process and pressures vulnerable consumers into making hasty decisions by leading them to believe that tickets are selling out; and
  • Viagogo misrepresents that it is an official ticket reseller, when in fact it is not.

In 2018, the Commerce Commission received more complaints about Viagogo’s practices than any other trader, and ‘by some considerable margin’.[1] The complaints are said to number 750 in total, including complaints about tickets to the 2017 British Lions tour of New Zealand, All Blacks matches, and various concerts, including Bruno Mars in February 2018.

In the substantive proceedings, the Commission seeks declarations as to Viagogo’s alleged breaches of the FTA, orders restraining it from continuing to make the representations that are said to be misleading and deceptive, and orders requiring Viagogo to publish corrective statements.

Interim injunction proceedings

Pending determination of the substantive proceedings, the Commission filed an injunction application requesting interim orders prohibiting Viagogo from making specific representations about the number of tickets available, the likelihood of the tickets selling quickly, and the validity of the tickets.

Viagogo was not expected to be represented at the hearing but appeared through a practice which allows the respondent to an ex parte application to appear at the hearing without the need to file written submissions.

Jurisdictional issues

Viagogo, which is based in Switzerland, has not yet been served formally. While Viagogo is aware of the proceedings, formal service in Switzerland may take around six months. Viagogo argued that since they have not been formally served, the Court has no jurisdiction to determine the injunction application.

Despite accepting that the Court has jurisdiction to hear the substantive proceedings, Justice P Courtney agreed with Viagogo that the Court has no jurisdiction to hear the interim application because the defendant has not yet been served.

Summary

While this outcome is favourable to Viagogo in the short-term, the substantive hearing could result in significant fines and sanctions for the company if the Commerce Commission’s allegations are proved.

Overseas, Viagogo is also facing court or enforcement action in Switzerland, Germany, France, Spain, the UK, and Australia. A criminal complaint has also been filed in Switzerland by FIFA.

 


[1] Commerce Commission v Viagogo AG [2019] NZHC 187 at 1.

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