Presson v. Alamo Intermediate II Holdings, LLC

Background

James Presson sued Alamo Intermediate II Holdings, LLC, individually and on behalf of others similarly situated. He alleged that Alamo violated New York Arts & Cultural Affairs Law § 25.07(4) by charging a $1.89-per-ticket convenience fee without displaying the total ticket cost, including ancillary fees, before the ticket was selected for purchase.

According to the complaint, the fee appeared for the first time on the checkout page after the customer selected seats. The checkout page also contained a pre-checked box for joining “Alamo Victory.” Text below the box stated that checking it would mean agreeing to Alamo’s terms of use. The terms included mandatory arbitration and a waiver of participation in class actions.

Alamo moved to compel arbitration under the Federal Arbitration Act. Alternatively, it asked the court to dismiss under Federal Rule of Civil Procedure 12(b)(1) for lack of subject-matter jurisdiction and Rule 12(b)(6) for failure to state a claim.

Arbitration

The court held that Alamo did not show that Presson agreed to the website terms. Online users may be bound by terms when a reasonably careful user would be put on notice of them and the user’s conduct clearly shows agreement. Here, the relevant box was already checked, so Presson did not take the specific action that the page described as agreement to the terms.

The court also rejected Alamo’s argument that Presson agreed by clicking “Buy Tickets.” The page warned that checking “Join Alamo Victory” would constitute agreement, but it did not say that clicking “Buy Tickets” would have that effect. The court therefore denied the motion to compel arbitration.

Subject-Matter Jurisdiction and Standing

Alamo argued that Presson had not alleged a concrete injury because his complaint concerned only when the fee was disclosed. The court disagreed. It held that Presson alleged a concrete financial injury by alleging that he paid a fee made unlawful by the failure to disclose it at the beginning of the transaction. The court stated that whether the fee was actually unlawful was a merits issue, not a question of standing at this stage.

Failure to State a Claim

The court rejected Alamo’s argument that the voluntary-payment doctrine barred the claim. That doctrine can prevent recovery of payments made voluntarily with full knowledge of the relevant facts, absent fraud or a material mistake. But the court stated that the doctrine does not apply when the plaintiff challenges whether the defendant fully disclosed the charge. Because Presson alleged that the fee was disclosed only after he selected the tickets, the doctrine was not a basis for dismissal at this stage.

The court also held that Presson plausibly alleged a violation of New York Arts & Cultural Affairs Law § 25.07(4). The statute requires disclosure of the total cost and fees before the ticket is selected for purchase, and Presson alleged that the convenience fee first appeared afterward on the checkout page.

Finally, Alamo argued that the statute’s $50 penalty was constitutionally excessive. The court declined to decide that issue because no damages had yet been awarded, making the damages question premature.

Disposition

The court denied Alamo’s motion to compel arbitration or, alternatively, to dismiss. The court directed the parties to appear for a telephonic initial pretrial conference on April 11, 2025, and directed the Clerk of Court to terminate the motion.