Hotels and Online Travel Companies Move to Throw Out Class Action Suit

By on September 24, 2013

by Megan Morley

Last week, a group of hotels and online travel companies moved to dismiss an amended class action complaint alleging that they engaged in a price-fixing conspiracy to control hotel room prices.  Online Travel Company Hotel Booking Antitrust Litigation, case number 3:12-cv-03515.  The companies, which include Travelocity and Hilton Worldwide, argued that the plaintiffs abandoned the principle elements of the conspiracy alleged in the initial complaint.  First, plaintiffs no longer allege that individual agreements between a hotel and online travel companies violated antitrust laws.  Second, plaintiffs admit that they have no basis to prove a horizontal conspiracy among the hotel defendants.  According to the defendants, the plaintiffs’ case only relies on purported collusion between the online travel companies and hotels to implement similar distribution programs.  These factual allegations, however, are not sufficient to bring an antitrust claim under the Supreme Court’s decision of Bell Atlantic Corp. v. Twombly, 550 U.S.544, 557 (2007), which requires “allegations plausibly suggesting (not merely consistent with) agreement.”  The defendants contend that the plaintiffs’ allegations do not plausibly suggest that they entered individual distribution arrangements pursuant to a horizontal conspiracy at either the hotel or online travel company level.  Rather, the defendants argue that the facts demonstrate each company’s independent interest in implementing these individual hotel-online travel company arrangements in response to the development of the internet as a distribution channel for travel purchases.





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