Here’s Everything You Need To Know About California’s Proposed Ban On Black Market Restaurant Reservations

Reservations at restaurants such as San Francisco’s House of Prime Rib appear on third-party resale sites | House of Prime Rib

New York passed its own law on third-party reservation sites in December, and now California, Chicago, Florida, and Nevada hope to join in

Many of California’s restaurants require a reservation for dinner, and for the state’s harder-to-get tables, black market reservation websites have only made things more difficult — and more expensive — for diners to get in the door. Sites like Appointment Trader sell reservations to the biggest restaurants across the country, including those in California’s own backyard, like fine dining establishments the French Laundry or Funke in Beverly Hills, even House of Prime Rib in San Francisco. Now, California is joining a slew of states taking steps to regulate the industry.

In December, New York Gov. Kathy Hochul signed the Restaurant Reservation Anti-Piracy Act into law, making it the first state to ban third-party websites from profiting off gamifying reservation platforms like OpenTable, Resy, Tock, and SevenRooms. In February, California followed suit with the introduction of Assembly Bill 1245 on Wednesday, February 26, which would “prohibit third-party reservation services from arranging unauthorized reservations, putting an end to a predatory marketplace that exploits customers and harms small businesses,” per a press release from Assemblymember Catherine Stefani (D-San Francisco), who’s sponsoring the legislation. Other states, such as Illinois, Nevada, and Florida are also seeking their own measures to prevent companies from selling restaurant reservations.

Here’s a closer look at these so-called reservation resale sites and the legislation being proposed:

How do these third-party sites get the reservations in the first place?

Many third-party marketplaces are using technology to quickly scoop up reservations. Once restaurants release reservations onto Resy or OpenTable, bots then swoop in and take up reservation slots, often targeting trendy restaurants with tough tables, effectively owning the time slots. Sites then place the reservations for sale on their own platforms. Effectively, it’s the philosophy of scalping concert tickets and then reselling them at a higher value than the individual originally paid.

Diners can also seek specific reservations for a restaurant and “[offer] financial ‘rewards,’” per a San Francisco Chronicle article on Appointment Trader for that reservation. (Perhaps akin to, say, a bounty.) The requester can either get a reservation from someone who already has a table locked down, or other folks can try and get that reservation to earn the fee.

But there’s also a more low-tech route, such as this entrepreneurial gentleman, who was quoted in 2024 as making $70,000 in bookings by creating phony numbers and emails to obtain reservations, which he in turn sells to others.

Wait a second. How much are people paying for reservations?

The rates for restaurants depend on the time and place. There is a marked difference between a weekend reservation and one on a weekday.

Looking for a reservation for a table of six at House of Prime Rib on Friday, March 21, will cost $250, according to a glimpse at one such site as of this writing. The French Laundry, meanwhile, can fluctuate between $120 for a Friday night table on March 14 — assuming one can make it there on such short notice — to as much as $2,540 for a guaranteed table for four on Monday, March 17. One scalper quoted in the New York Post says they charge a fee that’s anywhere between $500 to $1,000 and have worked with both Justin and Hailey Bieber and the NBA to secure tables.

So why is this a problem for restaurants?

As Eater Chicago reports, restaurants are harmed by third-party reservation resellers in a few ways. Restaurants appear to be booked out, due to reservations being taken by bots, for instance, and real customers then miss out on making a reservation and will likely avoid becoming a walk-in since a space appears fully booked. Then, when a reservation doesn’t sell, restaurants instead encounter a no-show situation, which hurts business, and, as the San Francisco Chronicle points out in a story on reservation no-shows, it wastes worker hours and perishable ingredients.

But what do third-party sites have to say about it?

Jonas Frey, the founder of Appointment Trader, likens his business to Stubhub, which is a third-party seller for sports and concert tickets, and feels that his company is being unfairly targeted by these bills. He says that the business actively works to prevent piracy by booting users who sell fewer than 50 percent of their reservations, and that the website doesn’t use bots.

In his interview with Eater Chicago, Frey points to the businesses that support these bills — particularly Resy and Tock, who are backed by American Express — stating that these credit card companies offer exclusive reservations which are directly threatened by companies such as Appointment Trader. No consumer watchdogs have publicly supported these measures, he points out.

I’m still not sure I understand. What’s the big deal about using sites like this?

While sites like Appointment Trader argue that they can police their own industry, the current system means that in practice many regular customers lose out and businesses that are unwilling participants are harmed. When reservations are offered to the highest bidder, only the richest folks — like, say, the Biebers or the NBA — can afford to routinely pay for a reservation. “This has created a dining culture where only those who can pay the extra fees are able to secure highly coveted reservations at popular establishments, leaving many individuals and families with no opportunity to simply book a reservation once slots have been released by the restaurant,” as the press release from Stefani’s office states.

Worse though, the people who do want to visit the restaurant but don’t want to pay extra for a reservation miss out and restaurant tables can (and do) go unfilled at establishments that might not have consented to the sale of reservations.

If this bill is passed into law, is it even enforceable?

Stefani told the San Francisco Chronicle that enforcement will be “complaint driven,” and fines would be up to $1,000 per violation.

Has anything like this ever happened before?

One could argue that this practice is a more high-tech version of line-sitting. The main difference being people who sell their services as line-sitters have to physically be present. When a bot is doing the work for you, you can be everywhere all at once.

— Additional reporting by Brenna Houck.