Fyre Festival

Fyre Festival
Dates April–May 2017
Location(s) Bahamian island of Great Exuma
Years active 2017
Founded by Billy McFarland/Fyre Media App[1]
Attendance 400+
Website
www.fyrefestival.com

The Fyre Festival was a music festival scheduled to take place on the Bahamian island of Great Exuma over two weekends in April and May 2017.

Organized by Fyre Media founder Billy McFarland and rapper Ja Rule as a luxury music festival to promote the Fyre music booking app,[1] the event was promoted on Instagram by "social media influencers" like Kendall Jenner, Bella Hadid, Emily Ratajkowski, and other models, many of whom did not initially disclose they had been paid to do so, in violation of federal law.[1] It experienced problems related to security, food, accommodations and artist relations, and was indefinitely postponed after some festival-goers had already arrived, finding tents and prepackaged sandwiches instead of the luxury villas and gourmet meals they had been promised in exchange for the thousands of dollars they had paid for admission.[2]

As a result, the organizers are the subject of eight lawsuits, one seeking more than $100 million in damages. The suits accuse the organizers of defrauding ticket buyers. On June 30, 2017, the United States Attorney for the Southern District of New York charged Billy McFarland with one count of wire fraud.[3]

History

The festival was organized by Billy McFarland and rapper Ja Rule[2] to promote the Fyre music booking app.[1] During a flight with McFarland, whom Rule had come to know through regular visits to events McFarland hosted at his previous venture, Magnises, Rule's private plane stopped on Great Exuma island in the Bahamas to refuel, and the two conceived the idea of the festival after taking the island in. After several small islands that seemed like likely venues were turned down, the Bahamian government gave McFarland a permit to use a site set aside for development at Roker Point.[4]

At the time, society photographer Patrick McMullan, who had been a regular at Magnises, where McFarland had hired his son as a disc jockey, had hired McFarland to build him a new website. Nothing emerged, and McMullan believes that McFarland was instead using the money the photographer had already paid him to fund Fyre instead. He does not believe this was due to incompetence on McFarland's part. "It's not like these guys were in over their heads", he said after the festival debacle. "These are fraudulent people." He has yet to be repaid or presented with a prototype website.[4]

On December 12, 2015, Kendall Jenner, Emily Ratajkowski and other influencers whom Fyre had paid to do so simultaneously posted to their Instagram feeds an image of an orange square with a stylized logo of flames. When viewers clicked on it they opened a promotional video showing Bella Hadid and other models represented by her agency running around a tropical beach. Text with the video promised "an immersive music festival ... two transformative weekends ... on the boundaries of the impossible". This was the beginning of the Fyre Festival's promotional campaign.[4]

"It's one of the greatest social-media campaigns I've ever seen," a financial manager for a popular rapper commented later. "They got the most beautiful women in the world, with the largest social following." However, when he called McFarland later to find out more, and found out that his partner was Ja Rule, he declined McFarland's invitation to invest, believing that the promises of the festival could only be fulfilled if a star as prominent as Jay-Z or Kanye West was involved. "I was surprised at all the artists who committed," he recalled later, because "we didn't take this seriously at all."[4]

One of those who did invest, fashion executive Carola Jain, reportedly got Fyre a $4 million loan. The company used most of it to rent luxurious offices in Manhattan's TriBeCa neighborhood. With no experience staging an event of the proposed festival's scale, McFarland began reaching out to companies that did. However, he was reportedly taken aback when they told him the event would cost at least $5 million, perhaps even $12 million to stage in the time available as he had promised; he and his associates at Fyre believed it would cost far less and continued with their plans under that assumption, which one executive at a company he contacted calls "a complete detachment from reality". They tried to do things themselves where possible; McFarland supposedly learned how to rent the stage by doing a Google search.[4]

Scheduled for two weekends in April and May 2017, the event sold day tickets for $1,500, and VIP packages including airfare and luxury tent accommodations for US$12,000. Customers were promised accommodations in "modern, eco-friendly, geodesic domes"[5] and meals from celebrity chefs.[6]

Contrary to the festival's promotional material, "Fyre Cay", the festival site, a remote private island it falsely claimed once belonged to drug trafficker Pablo Escobar, did not exist. Instead, workers in the Bahamas were busy preparing Roker Point for the festival, scattering sand over its rocks and improving a road to a nearby beach, where they built some cabanas and installed swing sets. On the mainland, five thousand tickets had been sold and an air service hired to charter festivalgoers from Miami. A medical-services company and caterer were hired, although the latter withdrew a few weeks before the festival.[4]

In March 2017, Fyre also hired a veteran event producer, Yaron Lavi, who saw that it was possible to hold the sort of event McFarland and Rule envisioned, at the site. He assumed, however, that they would reschedule the event to November as they had been discussing since they were not ready. But after they told him they would stage the event in the spring anyway, he said they would have to abandon the plans for temporary villas and instead erect tents, the only accommodations that could be delivered in the time remaining. Lavi advised Fyre to make this clear to those who had already bought tickets as otherwise it would be damaging to their brand; he says the company assured him that an email was being prepared but he is not sure if it was sent.[4]

Comcast Ventures considered investing $25 million in the app, which McFarland apparently hoped would allow him to finance the festival, but declined days beforehand.[7] Reportedly McFarland had valued Fyre Media at $90 million, and was unable to provide sufficient proof of that when Comcast requested it.[4]

Writing for New York magazine, one of the event organizers would later note that since at least mid-March, there were significant problems with the planning, and at one point it was agreed to outright cancel the 2017 festival in favor of working to perfect a 2018 one. These plans however were revoked at the last minute with the decision to go on with the event as planned. "Let's just do it and be legends, man", one of the organizers is reported to have said.[8]

By mid-April, Page Six began reporting rumors that the festival organizers were too disorganized and "in over their heads".[9] The Wall Street Journal reported that there were issues with artists not being paid, and that the event had failed to acquire a complete lineup. Blink-182, the first weekend's headlining band, pulled out on April 27, the day before the festival was scheduled to begin.

Business journalist Bryan Burrough later reported in Vanity Fair that after the Comcast deal fell through, McFarland had obtained some temporary financing for Fyre through investor Ezra Birnbaum that required the company repay at least half a million dollars of the loan within 16 days. The only place where the company could get that kind of money within that time was from the festival receipts. Burrough speculates that this may have been McFarland's primary motivation for proceeding with the festival despite the many difficulties.[4]

Around this same time, Fyre informed ticketholders that the event would be "cashless (and cardless)," and encouraged attendees to put up to $1,500 in advance on a digital Fyre Band to cover incidentals, according to one lawsuit. McFarland, who signed the email, suggested that they upload $300–500 for every day they planned to attend. According to a lawsuit later filed by Birnbaum, 40% of this money was to be used to pay off the short-term loan.[4][10]


At the venue

On April 27, attendees began arriving on chartered flights from Miami International Airport to Exuma International Airport operated by Swift Air and Xtra Airways. Initial arrivals were brought to an "impromptu beach party" rather than the festival grounds while later arrivals were brought directly to the grounds where the true state of the festival's site became apparent. Flights scheduled for the afternoon were delayed and then canceled when it became clear that the festival would not go on as planned.[11]

Around nightfall one musical act, a group of local musicians, took to the stage and played for a few hours. They would be the only act to perform. Afterwards it was announced that the festival would be postponed and that the attendees would be returned to Miami as soon as possible. Reports emerged of mishandling of guests' baggage, disaster relief tents with dirt floors, portable toilets,[11] inadequate and poor quality food including cheese sandwiches[12] made with slices of processed cheese on wheat bread served in styrofoam containers,[13] theft, and heavy-handed security. Many attendees were reportedly stranded as flights to and from the island were cancelled after the postponement.[14][2]

The first flight back to Miami boarded at 1:30 a.m. on Friday, April 28 but was delayed for hours due to issues with the flight's manifest. It was cancelled after sunrise and passengers were locked in the Exuma Airport terminal without access to food or water[15] and no air conditioning; one passenger recalls that at least one person passed out from the heat.[4] The flight eventually left Exuma that morning. More charter flights to Miami departed Exuma throughout the day.

Involved parties

Organizers

With $3.1 million in venture capital to date and 25 employees, Billy McFarland also founded a card company called "Magnises," which promised members paying an annual $250 fee that they could "unlock their cities and take their lives to the next level," including "private members-only concerts, tastings with notable chefs, and exclusive art previews at top galleries." The Washington Post reported that "some of those benefits never materialized or were far from what was advertised."[16] "They send the same email for every problem, but it's like fill-in-the-blanks for what the problem is," a member reported to Business Insider.[17] Magnises reportedly became profitable last year.[17]

The Washington Post reported that McFarland "has a history of overpromising" in his previous business ventures, and cited multiple examples. For example, after McFarland sold tickets to the musical Hamilton for $430, the tickets were cancelled at the last minute. In a complaint to the Better Business Bureau, one customer seeking a refund reported getting no response to multiple queries over a month and a half.[18]

Celebrity promoters

The event was promoted on Instagram by Kendall Jenner (who was paid $250,000 and has since deleted the post), Bella Hadid, Emily Ratajkowski, and other actresses and models.[1] Ratajkowski was reportedly the only actress or model to use the hashtag #ad,[19] but has also since deleted the post.[20] Only later was it reported that Jenner and the others had been paid to make the posts, something they were required under federal law to disclose. The Federal Trade Commission said #ad only worked if at the beginning of paid posts, and that the hashtag alone was not a sufficient disclaimer.[20][21]

Aftermath

Ja Rule posted a note on Twitter that said "it was NOT A SCAM" and "this is NOT MY FAULT".[22]

Fyre Festival posted a statement on their website.

"Fyre Festival set out to provide a once-in-a-lifetime musical experience on the Islands of the Exumas. Due to circumstances out of our control, the physical infrastructure was not in place on time and we are unable to fulfill on that vision safely and enjoyably for our guests. At this time, we are working tirelessly to get flights scheduled and get everyone off of Great Exuma and home safely as quickly as we can. We ask that guests currently on-island do not make their own arrangements to get to the airport as we are coordinating those plans. We are working to place everyone on complimentary charters back to Miami today; this process has commenced and the safety and comfort of our guests is our top priority. The festival is being postponed until we can further assess if and when we are able to create the high-quality experience we envisioned. We ask for everyone's patience and cooperation during this difficult time as we work as quickly and safely as we can to remedy this unforeseeable situation. We will continue to provide regular updates via email to our guests and via our official social media channels as they become available."

On April 29, 2017, Fyre Festival announced that it would offer all attendees a choice between a full refund or VIP tickets to the following year's festival.[23][24]

Many news organizations compared the chaos to William Golding's novel Lord of the Flies and Suzanne Collins's book The Hunger Games.[25][26][27][28]

The Bahamas Ministry of Tourism apologized on behalf of the nation and denied having responsibility for how the events unfolded.[29]

Lawsuits

As a result of the festival, McFarland and Ja Rule are the subject of a $100 million lawsuit in the state of California. It was filed on behalf of plaintiff Daniel Jung by entertainment lawyer Mark Geragos, who is seeking class action status for the lawsuit with over 150 plaintiffs.[30] Per the filing, Jung's lawsuit alleges fraud, breach of contract, breach of covenant of good faith and negligent misrepresentation.[31] Ben Meiselas of Geragos's firm pledged to hold "all those who recklessly and blindly promoted the festival" accountable, which was interpreted as being directed at Jenner, Hadid, and other social media "influencers".[32] A Geragos lawyer stated Fyre Festival sent cease and desist letters to whistleblowers.[33]

A second class action lawsuit against Fyre Media, McFarland, Ja Rule, and the event promoters identified as "Does 1-100" was filed in Los Angeles by personal injury lawyer, John Girardi on behalf of 3 attendees.[34] The plaintiff alleges that they deceived patrons into attending the festival by paying over 400 social media personalities and celebrities to promote it. The parties are accused of breach of contract, negligent misrepresentation, and fraud.[35] A Bloomberg reporter filed a FOIA to the FTC regarding their Instagram knowledge, after the second class action lawsuit zinged the event promoters.[34]

A third lawsuit was filed in New York federal court against Ja Rule, McFarland, Fyre Media, and chief marketing officer Grant Margolin. Plaintiffs Matthew Herlihy and Anthony Lauriello accused the festival organizers of "false representations, material omissions... negligence, fraud, and violations of consumer protection statutes".[36]

National Event Services, which provided medical services for the festival, filed a lawsuit, claiming to have suffered $250,000 in damages and alleging breach of contract, fraud, and negligence on the organizers' behalves.

In New Jersey federal court, festival attendee Andrew Petrozziello filed a lawsuit alleging that the organizers' violated state consumer fraud act and committed breach of contract.[37]

A sixth lawsuit, filed in Florida federal court as a class action suit, alleges violations that include fraud, negligence, and breach of contract. The plaintiffs Kenneth and Emily Reel accused the organizers of sending cease and desist letters to people who criticized the festival on social media.[38]

A seventh lawsuit was filed in Manhattan federal court as a class action suit on behalf of Sean Daly and Edward Ivey. In addition to the infractions mentioned in the other lawsuits, this suit alleges unjust enrichment and violation of New York state business law, claiming that the organizers continued to offer VIP upgrades and opportunities to deposit money into the "Fyre Band" payment system after the festival had been canceled.[39]

An eighth lawsuit was filed in Suffolk County Superior Court on behalf of ticketing vendor Tablelist. The company is alleging that the festival organizers and financial backers committed breach of contract and fraudulently deceived Tablelist and ticket purchasers. Tablelist is seeking $3.5 million to refund customers, as well as damages resulting from loss of business after being forced to lay off 40% of their workforce to focus on the litigation.[40]

Criminal investigation

On May 21, 2017, The New York Times reported McFarland and his associates are under an active federal criminal investigation by the Federal Bureau of Investigation for mail fraud, wire fraud, and securities fraud. The case is being overseen by the United States Attorney for the Southern District of New York.[41] On June 30, 2017, Billy McFarland was arrested and charged with one count of wire fraud.[3]

See also

Other festivals and conventions that suffered disastrous consequences due to poor organization and planning:

References

  1. 1 2 3 4 5 Bluestone, Gabrielle (April 29, 2017). "A National Punchline". Vice. Retrieved May 1, 2017.
  2. 1 2 3 Coscarelli, Joe; Ryzik, Melena (April 28, 2017). "Fyre Festival, a Luxury Music Weekend, Crumbles in the Bahamas". New York Times.
  3. 1 2 "Manhattan U.S. Attorney Announces Charges Against Individual For Defrauding Investors In Digital Media Company". www.justice.gov. Retrieved 2017-07-01.
  4. 1 2 3 4 5 6 7 8 9 10 11 12 Burrough, Bryan (June 2017). "Fyre Festival: Anatomy of a Millennial Marketing Fiasco Waiting To Happen". Vanity Fair. Retrieved August 9, 2017.
  5. ↑ Wamsley, Laurel (April 28, 2017). "Paradise Lost: Luxury Music Festival Turns Out To Be Half-Built Scene Of Chaos". NPR. Retrieved 2017-04-28.
  6. ↑ Spence, Shay (April 28, 2017). "‘Literally Bread, Cheese, and Salad’: How Fyre Festival-Goers Were Duped After Promise of Celeb Chef Meals". People.com.
  7. ↑ Mosendz, Polly (May 4, 2017). "Comcast Rejected Funding Days Before Doomed Fyre Festival". Bloomberg Businessweek. Retrieved May 5, 2017.
  8. ↑ Gordon, Chloe. "I Worked at Fyre Festival. It Was Always Going to Be a Disaster.". NYMag. Retrieved 29 April 2017.
  9. ↑ Mara Siegler (April 17, 2017). "Are Fyre Festival organizers in over their heads?". Page Six. Retrieved 2017-04-29.
  10. ↑ Coscarelli, Joe; Ryzik, Melena; Sisario, Ben (May 21, 2017). "Criminal investigation of Frye". New York Times.
  11. 1 2 Rankin, Seija (April 28, 2017). "No Food, No Water, No Luxury Tents: The $12,000-Per-Ticket Disaster That Was the Short-Lived Fyre Festival". eonline.com.
  12. ↑ Ohlheiser, Abby (April 28, 2017). "The complete disaster of Fyre Festival played out on social media for all to see; ‘NOT MY FAULT’ says organizer Ja Rule". Washington Post.
  13. ↑ Lapowsky, Issie (April 28, 2017). "The Fyre Festival: The Fiasco We All Should Have Seen Coming". Wired.
  14. ↑ "'Like a refugee camp': Chaos at Fyre Festival". IQ Magazine. Retrieved 28 April 2017.
  15. ↑ Hooton, Christopher (28 April 2017). "Fyre Festival: Attendees 'locked in airport with no food or water'". Retrieved 29 April 2017.
  16. ↑ Wang, Amy B. (April 29, 2017). "The founder of the disastrous Fyre Festival has a history of overpromising ‘elite’ access". Washington Post.
  17. 1 2 Stone, Madeline (January 24, 2017). "Members of a private club for 'elite' millennials want their money back". Business Insider. Retrieved May 1, 2017.
  18. ↑ Amy B. Wang (April 29, 2017). "The founder of the disastrous Fyre Festival has a history of overpromising ‘elite’ access". Washington Post. Retrieved May 1, 2017.
  19. ↑ Megan Cerullo (April 28, 2017). "A complete "s--t show"". Vice. Retrieved May 1, 2017. Rich millennials paid thousands for Ja Rule's Fyre Fest and are now stranded on an island in disaster-relief tents
  20. 1 2 Plaugic, Lizzie (April 28, 2017). "Ja Rule's music festival disaster is a good reminder not to trust Instagram sponcon". The Verge. Retrieved May 1, 2017.
  21. ↑ Frier, Sarah (August 5, 2016). "FTC to Crack Down on Paid Celebrity Posts That Aren’t Clear Ads". Businessweek. Retrieved May 1, 2017.
  22. ↑ "Fyre Festival: When a $12,000 luxury festival in paradise turns into chaos". CNN. April 28, 2017.
  23. ↑ Moore, Sam (2 May 2017). "Fyre Festival offers ticketholders choice between full refund or VIP tickets to next year’s festival". NME. Retrieved 3 May 2017.
  24. ↑ "FYRE Festival FAQ". fyrefestival.com. Retrieved 26 April 2017.
  25. ↑ O'Connor, Roisin (2017-04-28). "A 'luxury festival' backed by celebrities descends into chaos as one guest calls it 'Rich Kids of Instagram meets Lord of the Flies'". The Independent. Retrieved 2017-04-29.
  26. ↑ Wanshel, Elyse (2017-04-28). "Fyre Festival, Which Cost Thousands Per Ticket, Devolves Into Giant Mess". Huffington Post. Retrieved 2017-04-29.
  27. ↑ White, Adam; Krol, Charlotte. "'Rich kids of Instagram meets Hunger Games': Guests at luxury Fyre Festival where tickets cost $12,000 'mugged, stranded and hungry'". The Daily Telegraph. Retrieved 2017-04-29.
  28. ↑ Deerwester, Jayme. "Fyre Festival: From rich-kid party to national joke in one day". USA Today. Retrieved 2017-04-29.
  29. ↑ "'Luxury' Fyre Festival is cancelled with ticket-holders still stranded in Bahamas". BBC News. Retrieved 29 April 2017.
  30. ↑ Pearce, Sheldon; Monroe, Jazz (May 1, 2017). "Fyre Festival Hit With $100 Million Lawsuit". Pitchfork. Condé Nast. Retrieved May 1, 2017.
  31. ↑ Parisi, Paula (1 May 2017). "Mark Geragos Files $100 Million Suit Against Fyre Festival". Variety. Retrieved 3 May 2017.
  32. ↑ Chapple, Jon. "Lawyers seeking big wins over Fyre Festival woes". IQ Magazine. Retrieved 3 May 2017.
  33. ↑ Meiselas, Ben [@meiselasb] (2 May 2017). "On April 28, 2017 as #Fyre attendees tried to warn others, #Fyre lawyers were sending cease and desist letters to whistleblowers! #fyrefraud" (Tweet). Retrieved 3 May 2017 – via Twitter.
  34. 1 2 Mosendz, Polly [@polly] (2 May 2017). "Interesting: The second Fyre Festival lawsuit zings influencers who were paid to hype the event but didn't disclose it, per FTC standards." (Tweet). Retrieved 3 May 2017 – via Twitter.
  35. ↑ Cullins, Ashley (May 2, 2017). "Fyre Festival Debacle Sparks Another Class Action Lawsuit". The Hollywood Reporter. Retrieved May 3, 2017.
  36. ↑ Hogan, Marc (May 4, 2017). "Fyre Festival Hit With Third Lawsuit". Pitchfork. Condé Nast. Retrieved May 5, 2017.
  37. ↑ Kreps, Daniel (May 5, 2017). "Fyre Festival Organizers Hit With Two More Lawsuits". Rolling Stone. Retrieved May 5, 2017.
  38. ↑ Hogan, Marc (May 8, 2017). "Fyre Threatened to Sue Twitter Critics for Potentially Inciting Riots, Sixth Lawsuit Claims". Pitchfork. Condé Nast. Retrieved May 8, 2017.
  39. ↑ Hogan, Marc (May 10, 2017). "Fyre Sold VIP Passes After Festival Was Canceled, Seventh Lawsuit Claims". Pitchfork. Condé Nast. Retrieved May 10, 2017.
  40. ↑ Blistein, Jon (May 16, 2017). "Ticket Vendor Tablelist Sues Fyre Festival Organizers for $3.5 Million". Rolling Stone. Retrieved May 17, 2017.
  41. ↑ Ryzik, Melena; Coscarelli, Joe; Sisario, Ben (May 21, 2017). "In Wreckage of the Fyre Festival, Fury, Lawsuits and an Inquiry". The New York Times. ISSN 0362-4331. Retrieved May 22, 2017.
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