Fyre Festival Attendees To Receive $7k Each in Class Action Settlement

Carolyn Casey, J.D.

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— Updated on May 21, 2021

Fyre Festival Attendees To Receive $7k Each in Class Action Settlement

The U.S. Bankruptcy Court in the Southern District of New York has announced a $2 million settlement in a ticket holder class action against organizers of the infamous Fyre Festival. Meanwhile, the man behind the festival, Billy McFarland, sits in prison serving a six-year sentence for fraud. The settlement, still subject to objections and approval, aims to compensate Fyre Festival ticket holders. These individuals had paid for a luxurious music festival and “cultural experience” in the Bahamas. But their expectations were dashed as the event was famously—and abruptly—canceled the morning it was due to start.

The Fyre Festival “Fantasy” Build-up

The Fyre Festival that never occurred was the brainchild of 25-year-old William McFarland. Prior to his festival venture, Mr. McFarland was known loosely as a tech-entrepreneur. He lived a lavish lifestyle, partying with celebrities and living in a Manhattan penthouse.

Fyre Media, McFarland’s company, pitched the Fyre Festival as a fantasy island experience on a private island in the Bahamas. The event promotion highlighted deluxe accommodations, gourmet food, celebrity interactions, and popular musical performances. Fyre Media also circulated promotional videos on social media featuring supermodels frolicking on a private Bahamian island. The company’s advertising was designed to appeal to well-to-do millennials. For attendees, Fyre Media promised the “cultural experience of the decade.” Rapper Ja Rule was also listed as a co-founder of the Fyre Festival.

Big Ticket Items

Fyre Media sold about 8,000 Fyre Festival tickets for the island extravaganza. Customers paid from $1,000-$12,000, depending on their selected packages. Fyre Media even promoted fake package offerings. They included deluxe suites and celebrity dinners when none existed. Certain lavish packages reportedly cost nearly $400,000. Other reports indicated VIP packages were asking $49,000 a head. To further advertise, Fyre Media also tapped model/influencer Kendall Jenner to promote special artist access at the festival to her millions of social media followers.

An Island Nightmare

Ticket holders started arriving the night before the Fyre Festival was to begin. But upon arrival, they encountered half-built infrastructure, cheese sandwiches instead of gourmet food, and a FEMA-like tent village as accommodations. The highly anticipated musical acts were nowhere in sight. Instead, festival-goers wandered around shipping containers while trucks whizzed by. Festival security was scarce as attendees scrambled. Plus, organizers provided no central communications to provide updates.

Next came an abrupt Fyre Festival Team cancelation announcement shared via their website. The statement offered little detail on recourse for attendees already in the Bahamas awaiting the event. It also blamed “circumstances out of our control” for the disastrous outcome.

Fraudster’s House of Cards Collapses

McFarland’s house of cards-style business dealings had started to crumble. A few weeks before the festival, McFarland’s company defaulted on a $3 million loan. Further, a potential Comcast Venture investment evaporated. Festival site construction and marketing vendors weren’t getting paid, and corners were being cut on the promised luxurious experience.

At this point, the FBI was hot on McFarland’s trail. According to the FBI, McFarland and Ja Rule decided to organize Fyre Festival to promote an app connecting fans with music celebrities for private party bookings. McFarland made countless misrepresentations as he raised millions of dollars from investors for the app, festival, and a failing credit card venture. He was convicted of fraud and is currently serving a six-year prison sentence.

The Settlement

Lawsuits started pouring in after the festival fiasco. The Fyre Festival LLC debtor bankruptcy only complicated this further. On April 13, 2021, the Chapter 7 Trustee filed a settlement agreement for this particular class action case involving 277 Fyre Festival ticket holders. The settlement allows for a collective general unsecured claim of $2 million on behalf of the “Ticketholder Claimants,” with each claimant to receive approximately $7,220.

The settlement amount covers “any and all damages associated with purchasing a ticket to a Festival that never occurred, purchasing air and other travel to the Festival, plus incidental and related damages that arose as a result of the experience.” To streamline administration, the law firm representing the Ticketholder Claimants will receive one payment for distribution to the individual claimants.

An Island Haze of Uncertainty

After a crazy experience with this promised culture event, ticket holders must wait to see if the payout amounts hold as the bankruptcy proceeds.  On May 13, 2021, a bankruptcy judge will oversee a telephonic hearing on the motion for settlement approval.


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