CoStar, luxury hotels hit with US consumer price-fixing lawsuit

Loews

21/02/2024 16:29

By Mike Scarcella
       Feb 21 (Reuters) - Commercial real estate information
giant CoStar  CSGP.O  has been sued in a proposed consumer class
action accusing it and a group of luxury hotel operators,
including Hilton  HLT.N , Hyatt  H.N  and Marriott  MAR.O , of
conspiring to keep room rental prices artificially high.
    Seven residents of California, Florida, Illinois and other
states filed the lawsuit in Seattle federal court on Tuesday,
seeking damages under U.S. antitrust law for alleged room price
overpayments. 
    The lawsuit accused the hotels of sharing competitively
sensitive, commercial information through CoStar’s Smith Travel
Research (STR) reports that show “performance benchmarking and
comparative analytics” for the industry. 
    The defendant hotels shared prices, supply and future plans,
allowing participating companies to use rivals’ strategic
information to inflate prices in Washington, D.C., San
Francisco, New York, Nashville, Chicago, Boston, Austin and
other cities, according to the lawsuit.
     “Teddy Roosevelt passed the antitrust laws to prevent
titans of industry from price fixing in smoke-filled rooms,” the
plaintiffs' lead attorney Steven Berman told Reuters, calling
the defendants' conduct the "modern equivalent." 
    Other defendants include InterContinental Hotels  IHG.L ,
Loews  L.N  and the U.S. subsidiary of Accor  ACCP.PA , the
French multinational hospitality company.
    Representatives from CoStar, Hilton, Hyatt, Marriott,
InterContinental Hotels, Loews and Accor did not immediately
respond to requests for comment on Wednesday.
    The lawsuit seeks class-action status for potentially
hundreds of thousands of people who rented rooms from a
defendant or alleged co-conspirator hotel from February 21,
2020, through the present.
    The allegations are based partly on information from
confidential witnesses, including a software engineer at STR and
a market director of revenue management at Marriott Ritz-Carlton
Hotels, the lawsuit said.
    The plaintiffs’ law firm, Hagens Berman Sobol Shapiro, has
brought similar data-related price-fixing lawsuits against
hotels in Las Vegas and rental property management companies.
Those cases are ongoing.
    
    The case is Jeanette Portillo et al v. CoStar Group et al,
U.S. District Court for the Western District of Washington, No.
2:24-cv-00229.
    For plaintiffs: Steve Berman, Theodore Wojcik and Xiaoyi Fan
of Hagens Berman Sobol Shapiro
    For defendants: No appearances yet
    
    Read more: 
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    Mobile home park owners blast ‘implausible’ rent
price-fixing class action