COVID-19: SXSW Organizers Hit with Class Action After ‘Refusing’ to Issue Refunds [UPDATE]

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The organizers of the annual South by Southwest (SXSW) music festival have been hit with a proposed class action lawsuit after allegedly refusing to issue refunds to those who bought wristbands, passes, badges and tickets to this year’s event, which is no longer taking place due to the COVID-19 crisis. 

Though defendants SXSW, LLC and SXSW Holdings, Inc. assured on February 28 that the festival would be held as planned, the event was canceled on March 6 after the City of Austin declared a state of emergency due to the pandemic. Six days later, the case says, the defendants, in response to countless refund requests, announced that no refunds would be available for 2020 ticket purchases. Instead, attendees were given the option to defer their badges to the 2021, 2022 or 2023 festival and get a 50 percent off the “walk-up rate” in an alternate year of their choosing between 2021 and 2023, according to the lawsuit.

SXSW’s organizers have acknowledged, however, that it’s far from a sure thing that festivals will be held in the future, the suit says. In all, the plaintiffs argue the defendants’ refusal to issue refunds leaves consumers to shoulder the weight of the economic ramifications of the coronavirus crisis.

“SXSW has, in effect, shifted the burden of the COVID-19 pandemic onto festivalgoers like Plaintiffs and the Class, individuals who in these desperate times may sorely need the money they paid to SXSW for a festival that never occurred,” the lawsuit says. 

According to the case, a trip to SXSW can run an attendee anywhere from $250 per ticket for entry to primary events and up to nearly $1,400 for badges that provide additional access to communal food courts, awards shows and expositions. A platinum badge, which grants full access to all official SXSW events, can cost roughly $1,700, the suit says, noting that with room and board costs, a typical trip to the festival can set a consumer back thousands of dollars.

When buying festival credentials, attendees are required to agree to the defendants’ Participation and Credentials Terms and Conditions, which the case says include a “Refund and Revocation Policy” that allows the organizers, at their sole discretion, to “cancel, revoke, or refuse” credentials, purchases, and/or hotel reservations made through SXSW. The policy further states that SXSW “does not issue refunds under any circumstances” and that “[a]ny and all payments made to SXSW are not refundable for any reason,” the complaint continues. 

The lawsuit argues, however, that the Refund and Revocation Policy contained with SXSW’s Participation and Credentials Terms and Conditions is in truth an “unenforceable, illusory, unilateral option contract” that leaves consumers with no recourse in the event the festival is canceled for any reason. At the same time, the case, which includes a claim for breach of contract, explains that SXSW’s terms and conditions contain a “choice of law” provision that stipulates the agreement remains enforceable, even if a provision contained therein is deemed otherwise:

“Through the Refund and Revocation Policy SXSW purports to reserve the right to retain any and all monies paid for credentials and passes regardless of whether SXSW elects to put on the festival. 

If enforced, however, the Refund and Revocation policy would render the PCT&C an unenforceable, illusory, unilateral option contract that allows SXSW to sell Credentials, cancel the Festival for any or no reason whatsoever, and retain all customer payments while leaving Plaintiffs and the Class without a remedy.” 

The suit looks to cover every individual in the U.S. who bought credentials for the 2020 SXSW festival in Austin, Texas.

ClassAction.org’s coverage of COVID-19 litigation can be found here and over on our Newswire.

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