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Case Details for "Expedia"
Expedia order to pay $184 million
Expedia (Nasdaq: EXPE), the world's leading online travel booking site, was ordered to pay $184 million for repeatedly breaching its contractual obligations to consumers by charging service fees under false pretenses in millions of hotel transactions.
The lawsuit was filed on behalf of Expedia customers and claimed that Expedia paid taxes based on the wholesale price, but collected taxes from consumers based the higher retail price, pocketing the difference. Expedia supposedly bundled the service-fee charges with taxes into a single line item, failing to disclose the separate amounts of each to consumers.
In its Terms of Use agreement, which governs every hotel transaction, Expedia promised that it would collect service fees only to "cover the costs" of servicing a given hotel reservation. The Court found that Expedia breached that promise by collecting service fees as pure profit.
The ruling provides the return of $184,470,452 in service fees to consumers who purchased hotel or travel packages including a hotel stay from Feb. 18, 2003 to Dec. 11, 2006.
Posted on:2009-06-01
Company: Expedia
Class: consumers who purchased hotel or travel packages including a hotel stay from Feb. 18, 2003 to Dec. 11, 2006
Scope: Nationwide
Type of Case: Consumer
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