SXSW Sued Over No-Refund Policy Following Cancellation Due to Coronavirus Pandemic

Two badgeholders for this year’s cancelled SXSW Festival have filed a lawsuit against the company over its no refund policy. The company had issued the policy in response to the coronavirus pandemic, which caused the city of Austin to cancel all large gatherings which occurred during the months of March and April.

The lawsuits were filed by Maria Bromley and Colorado resident Kleber Pauta last weekend. Both plaintiffs reportedly spent $1,600 and $1,020 on their badges respectively. The $1,600 price is the cost for the average platinum badge, the most expensive pass offered, however cheaper passes are available to those who purchase their badges early.

The festival has a strict no-refunds policy, while its co-founder and CEO Roland Swenson claims that the event’s cancellation was not covered by their insurance. Swenson stated that their insurance did not have a clause specifying that the festival would be covered in case of a pandemic, virus or communicable disease, or if the city of Austin had declared a “local state of disaster.”

Badegholders for the cancelled event have been told that they can defer their enrollment to next year’s SXSW, or the 2022 and 2023 editions of the festival. The suit put forth by the plaintiff’s however states that they “do not necessarily plan to attend future festivals … And even SXSW has acknowledged that future festivals may not occur.”

SXSW has also been hit hard from the losses caused by the festival, and was forced to lay off one-third of its staff following the cancellation. The festival was also the first major event to be cancelled by the virus, as the quarantines began to take place during the middle of March.

“SXSW, like many small businesses across the country, is in a dire financial situation requiring that we rely on our contracts (agreed to by would-be attendees at the time of purchase), which have a clearly stated no refunds policy. Though we wish we were able to do more, we are doing our best to reconcile the situation and offered a deferral package option” SXSW LLC wrote in a statement over the weekend.