The Washington Commanders will pay more than half a million dollars to settle a lawsuit in D.C. alleging the team engaged in deceptive practices to hold on to hundreds of thousands of dollars in security deposits paid by fans for premium tickets.
Under the terms of the settlement, announced by D.C. Attorney General Brian Schwalb on Monday, the Commanders will return over $200,000 to ticket buyers in D.C. and pay $425,000 to the District for attorney’s fees and other costs.
“Rather than being transparent and upfront in their ticket sale practices, the Commanders unlawfully took advantage of their fan base, holding on to security deposits instead of returning them,” D.C. Attorney Brian Schwalb said in a news release, adding that his office will “maintain strict oversight” over the team to ensure fans are reimbursed.
The team denied the allegations and, under the terms of the settlement, does not admit any wrongdoing.
In a statement to WTOP, a Commanders spokesperson said: “We have not accepted security deposits or seat licenses in more than a decade and have been actively working to return any remaining deposits since 2014. We are pleased to have reached an agreement on the matter with the D.C. attorney general and will work with the office to fulfill our obligations to our fans.”
D.C. filed the consumer protection suit in November, under Schwalb’s predeccesor Karl Racine, following a report last spring by the U.S. House Oversight and Reform Committee into the team’s business practices.
According to the suit, the Commanders began offering multiyear contracts for premium ticketholders, which required fans to pay a substantial security deposit, in 1996. Fans’ security deposits were supposed to be returned 30 days after the contracts expired.
“However, in reality, the team deceptively kept many of these security deposits for years after fans’ contracts expired, improperly using the security deposits for its own purposes,” a news release from Schwalb’s office stated.
In addition, when some fans sought to get their refunds, the team “unfairly and deceptively imposed further cumbersome requirements, which complicated the process for fans to reclaim their deposits,” the news release stated.
Schwalb’s office said the team’s practices violated the D.C. Consumer Protection Procedures Act.
Under the terms of the settlement, the Commanders must return what Schwalb’s office said is believed to be more than $200,000 in security deposits, following “strict outreach protocols,” set by the attorney general’s office. That includes using a public records search to find the most recent contact information for impacted fans and attempting to reach them by letter, phone and email.
In addition, the team must prominently post the refund process on its website and provide Schwalb’s office with “regular reports documenting their progress in returning the money to fans.”
The football team settled a similar suit in Maryland last November, agreeing to return security deposits and pay a $250,000 civil penalty.
The D.C. settlement on the security deposits is separate from another consumer protection lawsuit also filed by Schwalb’s predecessor last November alleging the team and the NFL had “repeatedly lied to and deceived” D.C. consumers about an internal investigation into sexual harassment of team workers.
That case continues in U.S. District Court, after lawyers for the team and the NFL sought to move the case out of D.C. Superior Court and into federal court.
The series of lawsuits in the Washington area were among the latest turns in the team’s tumultuous run under Snyder, who along with wife Tanya hired a firm in November to explore selling part or all of the team. That came amid multiple investigations and two weeks after Indianapolis Colts owner Jim Irsay said there was “merit to remove” Snyder.
Two groups, one led by Josh Harris and Mitchell Rales that includes Magic Johnson and another by Canadian billionaire Steve Apostolopoulos, have submitted fully financed bids to buy the Commanders. It’s unclear how soon a sale could happen; Snyder must first choose his preferred bidder and send to the league for approval.
The Associated Press contributed to this report.
