The opinion of the court was delivered by: Hon. Blanche M. Manning
The plaintiff, City of Chicago, filed a complaint in the Circuit Court of Cook County alleging that defendant, eBay, Inc. is liable for collecting and remitting Chicago's amusement tax on the resale of tickets to amusements sold on eBay. The defendant removed the action to this court based on diversity jurisdiction and has filed a motion to dismiss. For the reasons stated herein, the motion is granted.
The well-pled facts are taken as true for purposes of this motion to dismiss. The defendant owns and operates the website www.ebay.com, which acts as a website for millions of customers worldwide who want to sell or buy property, including tickets to sporting and cultural events and other amusements. Before a user may either purchase or sell anything on eBay, he or she must provide eBay with his or her name, address, phone number and email address.
Pursuant to the Chicago Municipal Code, "an amusement tax is imposed upon the patrons of every amusement within the city" equal to 9%. Chicago Mun. Code § 4-156-020(A). The Code further provides that, in addition to owners and operators of an amusement, resellers of tickets and reseller's agents are responsible for collecting and remitting the amusement tax to the City.*fn1 Specifically, the Code states:
It shall be the joint and several duty of every owner, manager or operator of an amusement or of a place where an amusement is being held, and of every reseller of tickets to an amusement, and of every reseller's agent, to secure from each patron the tax imposed by Section 4-156-020 of this article and to remit the tax to the department of revenue....
Id. at § 4-156-030(A)(emphasis added). The Code defines a "reseller's agent" as:
a person who, for consideration, resells a ticket on behalf of the ticket's owner or assists the owner in reselling the ticket. The term includes but is not limited to an auctioneer, a broker or a seller of tickets for amusements, as those terms are used in 65 ILCS 5/11-42-1, and applies whether the ticket is resold by bidding, consignment or otherwise, and whether the ticket is resold in person, at a site on the Internet or otherwise.
According to the city, eBay is a reseller's agent as that term is defined by the Municipal Code. The City alleges that, as a reseller's agent, eBay has "facilitated the resale of thousands of tickets to amusements taking place within the City" and that it "has failed to collect or remit the tax from any of those ticket sales...." Compl. at ¶¶ 19-20.
Section 3-4-180(B) of the Municipal Code further provides that "[i]f the taxpayer or tax collector fails to provide the documents requested in subsection A of this section within the time so provided.... the director... may request the city's corporation counsel to bring, or cause to be brought, an action to impose fines for disobeying or refusing to comply with a request made under this section." Pursuant to this section, the City alleges that eBay has failed to keep accurate books and records of its activities and produce those records to the Department of Revenue upon request. Id. at § 4-156-030(B) and § 3-4-180.
Based on these allegations, the City's complaint alleges the following causes of action: Count I--a declaratory judgment seeking a declaration that eBay is required to collect and remit the amusement tax on the sale or resale of tickets that are sold on its website; Count II--an action for mandamus ordering the defendant to produce its books and records and submit to an audit by the Department of Revenue; Count III--a claim that eBay has violated Code § 3-4-180 requiring it to provide its books and records at the Department of Revenue's request and requesting imposition of the resulting fines; and Count IV--an action for the amusement tax, interest, and penalties on the amounts the City alleges that eBay should have collected to date pursuant to the amusement tax provision in the Code.
eBay seeks to dismiss the complaint on several grounds, which the ...