Ticket Sellers Sue New York Over Selling Unowned Tickets (1)

A legal battle over online sales of event tickets not yet in the hands of sellers has erupted in New York.

Online ticker sellers TicketNetwork Inc. and Ticket Galaxy separately sued the state, alleging that the state attorney general is pressuring them to pay millions of dollars to avoid a civil lawsuit over a business model that is lawful.

At issue is a practice called “drop shipping,” in which a ticket is offered for sale before it’s owned by the seller, who procures the ticket after making the sale. TicketNetwork and Ticket Galaxy contend that the practice is common in ...