Failure to reveal resort fee: Is Priceline liable?

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In this week’s article, we examine the case of Singer v. The Priceline Group, Inc., 2017 WL 3976539 (D. Conn. 2016) in which the “Plaintiff, Adam Singer, has brought suit against (Priceline) alleging breach of contract, breach of implied covenant of good faith and fair dealing and unjust enrichment claims following the additional costs incurred on his vacation. Priceline moved to dismiss the Class Action Complaint (and that) motion to dismiss is granted”.

Travel Law Update

Uber Gets Bloody Nose

In Scott, Uber Suffers Bloody Nose in Its Fight to Conquer Europe, nytimes.com (5/11/2017) it was noted that “Uber suffered a setback to its global expansion plans on Thursday when a senior adviser to Europe’s highest court recommended that the rise-hailing company comply with the region’s tough transportation rules, potentially hobbling growth of its service across the Continent. The nonbinding opinion comes as Uber face growing pressure worldwide after a string of missteps…The European case centers on whether Uber should be considered a transportation service or a digital platform that merely connects drivers and potential passengers. By designating Uber a transportation service, Maciej Szpunar, an advocate general at the European Court of Justice in Luxembourg, said on Thursday that the company should comply with European countries’ safety rules, as well as with other legislation that applies to the traditional taxi association that Uber’s main rivals across the region. ‘Uber cannot be regarded as a mere intermediary between drivers and passengers’, Mr. Szpunar wrote an opinion that will be reviewed by the European Court of Justice, which is expected to make a final ruling by late summer”.

Stop Killing Monkeys, Please

In Romero, Brazil Yellow Fever Outbreak Spawns Alert: Stop Killing the Monkeys, nytimes.com (5/2/2017) it was noted that “As fears spread in Brazil over the resurgence of yellow fever [this is where Zika started] health officials are issuing a warning: Stop killing the monkeys. Some assailants clubbed monkeys to death in panicked reactions to Brazil’s most alarming outbreak in decades of a virus that haunted the country in the 19th and early 20th centuries. Authorities found other monkeys dead with fractured skulls after having been…attacked with stones. One monkey was burned to a crisp. Infectious disease specialists say people are taking aim at the wrong target. Mosquitoes, not monkeys, are actually the vector for the disease and the monkeys are dying from yellow fever in much higher numbers than people in Brazil”.

India Gets Tough

In India’s top court upholds 201 gang rape death sentences, travelwiremews.com (5/5/2017) it was noted that “Joti Singh, a 23-year-old physiotherapy student was raped and left for dead by a gang of five men and a teenager after she boarded a private bus while going home from the cinema with a male friend. She died of grievous internal injuries 13 days later. The brutality of the attack and her determination to survive long enough to identify her attackers to police, triggered large-scale angry street protests as well as soul-searching about India’s treatment of women”.

Dear Rivers, Closed Beaches

In Foderaro, ‘Dead Rivers, Closed Beaches’: A Water Crisis on Long Island, nytimes.com (5/8/2017) it was noted that “The Great South Bay, flanked by Fire Island and the South Shore of Long Island, once produced half the shellfish consumed in the United States and supported 6,000 jobs in the early 1970s. Since then the health of the bay has declined. Housing development meant more septic tanks disposing more nitrogen in the ground. The nitrogen flowed to rivers and the Great South Bay, leading to algae blooms. It depleted salt marshes that serve as fish habitat and suppressed oxygen levels. One result is that the shellfish industry has all but collapsed. The annual harvest of hard claims, for example, has fallen more than 90 percent since 1980”.

Shifting Tundra

In Fountain, Tundra May Be Shifting Alaska to Put Out More Carbon Than It Stores, Study Says, nyimes.com (5/8/2017) it was noted that “As global warming continues, a big unknown is what will happen to the carbon balance between the atmosphere and the land, especially in the far north. Will Artic and near-Artic regions continue to take more carbon dioxide from the atmosphere through plant activity that they release, or will they release more than they store? A new study suggests that Alaska, with its high stretches of tundra and forest. may be shifting from a net sink, or storehouse, of carbon to a net source. The study focused on one possible cause: warmer temperatures that keep the Arctic tundra from freezing until later in the fall, allowing plan respiration and microbial decomposition-processes that release carbon dioxide-to continue longer”.

No Hot Coffee, Please

In Hastings, Woman Sues Airline for $850,000, Claims Flight Attendant Dumped ‘Scalding’ Coffee on Her, insideedition.com (5/2/2017) it was noted that “A Virginia woman has sued Qatar Airways, claiming a flight attendant…slopped ‘scalding hot’ coffer on her lap, causing serious burns…Zahra Azizkhani, 72, is seeking $850,000 in damages”.

Shame On Delta

In “We are sorry”: Delta issues statement regarding flight 2222, Maui to Los Angeles, eturbonews.com (5/4/2017) it was noted that “A California family said they were thrown off a Delta flight and threatened with jail because they would not give up the seat their 2-year-old son was in…The father of the family posted this video of the incident with his statement…’Here is a video of Delta airlines booting myself, my wife and my 2 children ages 1 and 2 off delta flight 2222…They oversold the flight and asked us to give up a seat we purchased for my older son that my younger son was sitting in. You will hear them lie to me numerous times to get my son put of the seat. The end result was we were all kicked off the flight…When will this all stop?”.

Too Big To Fly?

In Man sues American Airlines for $74k after sitting next to “grossly obese’ passengers, travelwirenews.com (5/5/2017) it was noted that “An Australian man is suing American Airlines for AU$100,000 (US$74,080) after being forced to sit next to ‘grossly obese’ passengers on a long-haul flight. He claims he was forced to contort his body into positions which aggravated an existing back problem…The body of the passenger seated next to him ‘spilt over and encroached’ into his seat…’His wife leaned on him…then he went like this on me, and when he put his head on me, I said, ‘It’s not enough that you’re in my seat but you’re also want to sleep on me’”.

Uber’s Greyballing Not Good

In Issac, Uber Faces Federal Inquiry Over Use of Greyball Tool to Evade Authorities, nytimes.com (5/4/2017) it was noted that Uber apparently developed software known as Greyball which allowed Uber “to deploy what was essentially a fake version of its app to evade law enforcement agencies that were cracking down on its service’. The federal inquiry is taking place in Portland, Oregon. Greyball was part of a larger program VTOS which was used in the United States and in several foreign countries allegedly to evade ‘law enforcement personnel. After using a series of techniques to identify and tag officials, Uber would turn to the Greyball tool to show a false version of its app to officers who tried to hail an Uber car using their smartphones. Greyball was approved by Uber’s legal team, though some inside the company had qualms about it. Uber made a particular effort to deploy the tool in cities where it faced opposition from local regulators and rival taxi and transportation companies” such as Portland.

American Airlines Cuts Legroom

In Schlangenstein, American Airlines cuts legroom in New Boeing jetliner, msn.com (5/4/2017) it was noted that “American Airlines Group Inc.’s newest Boeing Co. 737s will have less legroom in most of the economy cabin than current versions of the narrow-body plane with at least three rows shrinking the space between seats to 29 inches. Pitch, or the distance from the back of one seat to the same spot on the one in front of it, will slip to 30 inches on the 737 Max from 31 on the Boeing 737…The 29-inch pitch on the three rows moves American close to the 28-29 inches offered in ultra discounters Spirit Airlines, Inc. and Frontier Airlines”.

Improving Baggage Handling

In Airline industry improves baggage handling as it readies for June 2018 deadline, eturbonews.com (5/4/2017) it was noted that “Baggage management by the world’s airlines improved again in 2016 as the industry focuses on technology investments and prepares for a step-change in handling by June 2018…This is good news for the rising number of passengers, which last year hit an all-time high of 3.77 billion…The IATA Resolution 753 is coming into force in June 2018 and from then every bag must be tracked and recorded at four mandatory points-at check-in, aircraft loading, at transfer between carriers and on arrival as the bag is delivered back to the passenger. When this is in place airlines will be able to share the information with their passengers and code share partners allowing them to track their bag, just like a parcel”.

More On Data Hacking

In Faccipointi & Moreno, So You’ve Been Hacked: The Changing Landscape of Post-Data Breach Liability, newyorlawjournal.com (4/27/2017) it was noted that “The impact of serious data breaches are becoming both more common and more costly for businesses with each major attack. According to the New York State Attorney General, businesses reported, 1,300 data breaches in 2016-a 60 percent increase from the prior hear-that involved the personal data of 1.6 million New Yorkers…The recent trend has been for federal regulators, such as the Federal Trade Commission (FTC) and more recently, the Securities and Exchange Commission (SEC) to treat hacked corporations less like victims and more like potential wrongdoers. This especially prevalent where the regulator concludes that the hacked corporation ignored red flags or failed to take appropriate precautions to protect sensitive data from theft”. See our article Hotel Law: Cybersecurity and Resort Fees, newyorklawjournal.com (4/24/2017).

Buckle Your Seat Belts, Please

In “Blood everywhere, broken bones, noses, open fractures’: Turbulence hots Moscow-Bangkok flight, eturbonews.com (5/1/2017) it was noted that “Turbulence ‘out of nowhere’ as passengers put it, injured up to 27 people-mostly Russians-on a Boeing 777 plane on route from Moscow to Bangkok…The reason so many people were injured was that they weren’t wearing safety belts, despite the usual warnings…The plane apparently suddenly hit so called ‘clear sky turbulence’ and the crew had no chance to warn passengers”.

Fyre Festival Fraud

In Sisario & Coscarelli, Fyre Festival Organizers Face Fraud Lawsuit After Cancellation, nytimes.com (5/1/2017) it was noted that “On Friday, the music industry woke up to the news that the Fyre Festival, promoted as a pair of luxurious concert weeds in the Bahamas, had been abruptly canceled, with attendees taking to social media to post images of shoddy beach accommodations and far-from-gourmet meals…Over the weekend, one disappointed ticket buyer files a lawsuit alleging fraud and the Bahamian government sought to reassure travelers of the safety of the islands”.

Travel Law Case Of The Week

“Priceline is a company that facilitates online travel reservations. Customers can access priceline.com and can choose from an array of ravel reservations such as hotel, airline and rental car reservations. In 2011, Priceline offered both traditional price-disclosed model, in which the customer would select a reservation from a listing of available reservations and the Name Your Own Price (NYOP) service, which would allow a customer to bid a certain dollar amount for a hotel reservation on a given date in a certain geographic area and at a certain ‘star level’ or class of service”.

The NYOP Service

“Under the NYOP service, Priceline promised to ‘match’ the customer’s bid with a hotel. The name of the hotel is not disclosed to the customer in advance of a bid, only after the bid has been accepted. Once the bid has been accepted, the customer’s credit card is immediately charged and the customer’s reservation cannot be cancelled, changed or transferred and refunds are not allowed”.

The Transaction

“Adam Singer alleges that he used Priceline’s NYOP service to secure a hotel room reservation on February 24, 2011. Singer sought to pay $107.00 per room per night for two rooms from Saturday February 26, 2011 until Monday February 28, 2011. Relying on the information provided by Singer but before he confirmed his bid, Priceline presented him with a final webpage screen displaying the following information: Offer Price Per Room Per Night: $107.00; Subtotal: $428.00; Taxes and Service Fees: $60.68; Total Charges*: $488.68″.

Important Information

The webpage also included the following information under the heading ‘Important Information’: * If Priceline accepts your price, Priceline will book your reservations in a property with an equal or higher star level than you requested. The hotel that is selected may or may not be one that you have seen during a hotel search on Priceline. Any sorting or filtering options previously used will not apply to this (NYOP) request…*The reservations holder must present a valid photo ID and credit card at check-in. The credit card is required for any additional hotel special service fees or incidental charges or fees that may be charged by the hotel to the customer at checkout. These charges may be mandatory (e.g. resort fees) or optional (parking, phone calls or minibar charges) and are not included in your offer price…Singer had to initial a box adjacent to the following statement: ‘I have read, accept and agree to abide by priceline.com’s terms and conditions and privacy policy”.

The Hyperlink: Taxes And Fees

“A hyperlink on this webpage, when clicked, would take the user pf the website to another webpage containing the ‘Priceline.com Incorporated Web Site Terms & Conditions’… Additional Restrictions…In connection with facilitating your hotel transaction, we will charge your method of payment for Taxes and Fees…Our hotel suppliers, as vendors, bill all applicable taxes to us and we pay over such amounts directly to the vendors…Depending on the property you stay at you may also be charged (I) certain mandatory hotel specific service fees, for example, resort fees (and may range from $10 to $40 per day), energy surcharges, newspaper delivery fees, in-room safe fees, tourism fees, or housekeeping fees and/or (ii) certain optional incidental fees, for example, parking charges, minibar charges, phone calls, room service and movie rentals/ These charges, if applicable, will be payable by you to the hotel directly at checkout…The Priceline website did not require a customer to click through the hyperlink (and) Singer alleges (that) he did not have any knowledge of the above-quoted Terms & Conditions”.

Bid Accepted

“Singer selected to make the bid. Priceline immediately accepted this bid and matched Singer with two rooms at the Waldorf Astoria El Conquistador Resort, a Hilton Hotel in Fajardo, Puerto Rico…At this time, Singer allegedly believed that his winning bid, as described in the confirmation email would cover the entire cost of the stay. Two days after purchasing his reservation from Priceline, Singer and his traveling companion commenced a two-night stay in rooms at the Hilton where he was charged a mandatory resort fees. He allegedly learned of the mandatory resort fee only after his arrival at the Hilton, when the hotel informed him that it would be charging him this additional amount”.

Failure To Reveal Resort Fee

“Singer alleges that Priceline had actual knowledge that the hotel bid it was offering him did not include a mandatory, per-day resort fees that the hotel would charge him at the end of his hotel stay, as well as actual knowledge of the amount of that mandatory fee, and that it did not share any of this information with him at any point, either prior or after his bid. Singer further alleges that he did not discover that: Priceline had actual knowledge of the Hilton’s resort fee until 2005 and that Priceline had intentionally concealed its knowledge of the fees for purposes of delaying his ability to file a complaint in this action”.

The FTC Letter Of Warning

“Singer also alleges that, in November 2013, the Federal Trade Commission (FTC) issued a letter warning that online reservation sites may violate the law by providing a deceptively low estimate of what consumers can expect to pay for their hotel rooms. In the letter, the FTC stated that hidden resort fees could affect consumer purchasing decisions had their existence been known and that in order comply with the law ‘online hotel reservation sites should include in the quoted total price any unavoidable and mandatory fees, such as resort fees, that consumers will be charged to stay at the hotel’”.

Breach Of Contract

“Since the express language of the contract Priceline and Singer provided for the possible payment of hotel resort fees, in addition to the offer price, Priceline’s Motion to Dismiss must be granted on Singer’s breach of contract claim…the contract explicitly contemplates that ‘additional hotel specific service fees…may be charged by the hotel to the customer at checkout’. It also explicitly states that ‘[t]hese charges may be mandatory and are not included in your offer price’”.

Covenant Of Good Faith

“Connecticut law recognizes ‘that the duty of good faith and fair dealing is a covenant implied into a contract or a contractual relationship’…’The covenant of good faith and fair dealing presupposes…that what is in dispute is a party’s discretionary application or interpretation of a contract term’…The principle…cannot be applied to achieve a result contrary to the clearly expressed terms of a contract…In short, the parties expressly contemplated the imposition of other costs by the hotel beyond the offer price and Singer, by agreeing to enter into the contract, agreed to be responsible for the payment of such costs…Motion to Dismiss is granted as to (breach of the covenant of good faith and fair dealing”.

Unjust Enrichment

“Singer’s final claim is a quasi-contractual one-unjust enrichment. Under this legal theory, [w]herever justice requires compensation to be given for property or services rendered under a contract and no remedy is available by an action on the contract, restitution of the value of what has been given must be allowed’…In this case, the express contract does fully address the subject of the cost of the hotel stay, explicitly sating that the hotel may charge additional fees directly to the customer…Motion to Dismiss (the unjust enrichment claim) granted”.

The author, Thomas A. Dickerson, is a retired Associate Justice of the Appellate Division, Second Department of the New York State Supreme Court and has been writing about Travel Law for 41 years including his annually updated law books, Travel Law, Law Journal Press (2016), Litigating International Torts in U.S. Courts, Thomson Reuters WestLaw (2016), Class Actions: The Law of 50 States, Law Journal Press (2016) and over 400 legal articles many of which are available at nycourts.gov/courts/9jd/taxcertatd.shtml. For additional travel law news and developments, especially, in the member states of the EU see IFTTA.org

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