By Brendan Kiley

The Seattle Times

They’ve been waiting nearly a year for what they’re owed: community centers, schools, musicians, theaters, youth organizations, a huge variety of nonprofits and their supporters. Some lost a few bucks. Others have been waiting on tens of thousands of dollars.

Seattle ticketing company Brown Paper Tickets has agreed to pay $9 million in restitution to an estimated 45,000 customers at both ends of the company’s business model: ticket buyers owed refunds and event organizers owed box-office revenue.

The Washington State Office of the Attorney General filed a consent decree in King County Superior Court on Monday, roughly five months after filing a lawsuit against Brown Paper Tickets on behalf of consumers.

Some of those customers were ticket-buyers who wanted their money back or wanted to donate the cost of their tickets for the canceled events, many of which were fundraisers. The company also failed to pay organizers for remote events that took place despite the pandemic or had occurred before its onset.

In all 45,000 cases, Brown Paper Tickets failed to deliver money it should have sent to customers.

“I felt cheated,” said Tracy Ringolsby, a retired sportswriter who is owed $13,444 from a pre-pandemic community event he’d organized. “I had put all the money up on my own. It would be nice if Brown Paper Tickets followed through and don’t just file bankruptcy and disappear.”

Under the consent decree, Brown Paper Tickets is obligated to pay the $9 million within seven months and submit detailed progress reports every 30 days. An estimated 90% of customers entitled to restitution are ticket buyers, the Attorney General’s Office said, and are owed an average of less than $50. Event organizers — the other 10% covered by the consent decree — are owed much more, ranging from the hundreds to the tens of thousands.

“Small theaters and arts organizations — like your local children’s theater, community center, church or music school — have been hit hard by COVID,” Attorney General Bob Ferguson said in a statement. “Today’s resolution ensures Brown Paper Tickets will uphold its promises to these essential community spaces by returning the millions of dollars it owes them, and puts money back into the pockets of thousands of individuals across the country.”

Founded in 2000, Brown Paper Tickets initially served as a virtual box office for small theaters and other nonprofits, managing and selling tickets for modest fees: $0.99 per ticket, plus 5% of each ticket’s face value. Brown Paper Tickets was sometimes called the David among industry Goliaths like StubHub and Ticketmaster.

In recent years, Brown Paper Tickets has expanded operations globally, with support services in Central America, Africa, Europe and Asia.

The trouble started in March during the onset of the coronavirus pandemic. At the time, Brown Paper Tickets founder and president William Scott Jordan said so many events were being postponed and canceled that the company lost control of its cash flow and financial machinery. In the chaos, he said, the company shut down all outgoing payments.

“We lost control over which payments were able to clear and which weren’t,” he said last March. “And we managed to piss off everybody.”

The Attorney General’s Office said its investigation confirmed Jordan’s story, stating: “It appeared to us that the company’s internal accounting and payment system was overwhelmed when the pandemic hit.”

Brown Paper Tickets has secured outside financing to pay the $9 million, the Attorney General’s Office said, and is legally required to prioritize payments to Washington residents. If the company does not fulfill that obligation, the Attorney General’s Office can secure a judgment in court and begin the collections process.

Over the past year, Brown Paper Tickets has already refunded millions of dollars to more than 25,000 customers in 33 countries impacted by the pandemic, including service fees.

Since March 2020, the Attorney General’s Office has received 1,174 formal complaints about Brown Paper Tickets from around the globe — but consumers do not have to file a claim to receive restitution.