CoStar, hotels slam consumers' ‘fanciful’ room pricing lawsuit
By Mike Scarcella
May 20 (Reuters) -Commercial real estate information giant CoStar CSGP.O and a group of high-end hotels have asked a U.S. judge to dismiss claims that they improperly shared data to keep room prices artificially high, calling the case "fanciful."
CoStar and six hotel operators including Hilton HLT.N, Hyatt H.N and Marriott MAR.O said in their Seattle federal court filing on Friday that there was no evidence that they conspired to fix prices.
The defendants called the lawsuit, filed in February, “implausible and legally deficient.” The consumer plaintiffs want to mimic a wave of antitrust lawsuits targeting "algorithmic pricing" as a newfangled form of price-fixing, but the CoStar data at the heart of the case involves "neither algorithms nor pricing recommendations," they said.
The lawsuit focused on CoStar’s Smith Travel Research (STR) reports, which advertise “performance benchmarking and comparative analytics” for the hotel industry. CoStar and the hotels defended the reports, which they said feature historical data on room availability and revenue.
CoStar, Hilton, Hyatt and Marriott either had no immediate comment or did not immediately respond to requests for comment, and neither did an attorney for the consumer plaintiffs.
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.
The complaint said the data reports "act as the essential 'fuel' propelling pricing algorithms towards the ultimate goal of charging higher prices."
The plaintiffs are seekingclass-action status for potentially hundreds of thousands of people.
CoStar and the hotels argued that a ruling allowing the lawsuit to move ahead “would set new precedent that could upend numerous industries where benchmarking is a common and important market-intelligence tool.”
A U.S. judge in Las Vegas on May 8 dismissed a consumer lawsuit accusing some major hotels there of sharing information with a revenue management platform to unlawfully coordinate on room prices.
The judge there said the plaintiffs had not shown that the hotels had made any agreement with each other to fix prices.
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.
Read more:
Las Vegas hotels defeat price-fixing class action over room rates
CoStar, luxury hotels hit with US consumer price-fixing lawsuit
RealPage must face renters' price-fixing lawsuit over multifamily housing
Reporting by Mike Scarcella
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