Here’s why SXSW is facing a lawsuit over their refund policy
The Austin-based festival South By Southwest (SXSW) is being hit with a class-action lawsuit over its refund policy (or lack thereof).
According to Billboard, the two plaintiffs, Maria Bromley and Pauta Kleber filed the suit on April 24 in the U.S. District Court for the Western District of Texas Austin Division.
Now, Bromley and Kleber are very upset with the festival organizers. They both claim to have spent over $1000 each on tickets. But, SXSW is refusing refunds.
After SXSW was canceled, those holding passes were informed refunds would not be available. Instead, SXSW offered pass holders free registration equal to the amount they spent for the 2020 festival. The offer would be valid for SXSW in 2021, 2022 or 2023. Additionally, ticketholders were offered a 50% registration discount to one of the future festivals.
According to the Billboard, both plaintiffs were informed that the offer expires on April 30, 2020 even though SXSW organizers allegedly told them they “cannot be certain that future festivals will occur”. However, the offers were only out forward on March 12.
"SXSW has, in effect, shifted the burden of the COVID-19 pandemic onto festivalgoers. Individuals who in these desperate times may sorely need the money they paid to SXSW for a festival that never occurred," the complaint reads.
One SXSW spokesperson spoke with Billboard and stated that the festival simply doesn't have enough money to refund the ticketholders.
"The pandemic and the cancellation have caused a tremendous loss to our business, our staff, the City, and its citizens," they said. "We are still picking up the pieces after spending a year to program what would have been a remarkable event that required significant time, energy, and resources to produce."
"Due to the unique nature of SXSW’s business, where we are reliant on one annual event, we incurred extensive amounts of non-recoupable costs well in advance of March. These expenditures, and the loss of expected revenue, have resulted in a situation where we do not have the money to issue refunds," the statement continues.
"SXSW, like many small businesses across the country, is in a dire financial situation requiring that we rely on our contracts, which have a clearly stated no refunds policy. Though we wish we were able to do more, we are doing our best to reconcile the situation and offered a deferral package option to purchasers of 2020 registrations.”
You can read the full statement here.
This isn't the first instance where ticketholders are suing over refund policies. As recently as last week, Live Nation, Ticketmaster and StubHub all have ongoing litigation regarding their refund policies.
The music industry is suffering greatly due to the coronavirus. But, so are fans who are facing layoffs. Unemployment in the U.S. has nearly reached 20%. With this uncertainty, people need their money now more than ever. We can only wait and see.
Tell us your thoughts about SXSW's policy in the comments below.
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