Class Action Accuses Expedia of Racketeering and Fraud
Class Action Accuses Expedia of Racketeering and Fraud
Attorneys filed a class action suit against travel booking juggernaut Expedia last week, alleging that the company overcharges customers on taxes and fees.Seattle Pi reports that Expedia is accused of ‘levying taxes beyond what’s required by local jurisdictions for hotel rooms and pocketing the proceeds.’This isn’t the first time the website’s run afoul of the law. According to Skift.com, Expedia settled a similar consumer suit in 2009 for $123.4 million. That suit alleged a widespread breach of contract, coupled with deceptive business practices.Travel portals have long been criticized for inadequately explaining the basis of tax charges and supposedly mandatory fees.The same Seattle law firm that sued Expedia in 2009 is spearheading the latest class action. Along with tax fraud, Hagens Berman says the company has violated the Racketeering and Corrupt Organizations statute—a federal law originally designed to take down members of the American Mafia, but which has seen novel utilization since.The suit focuses on charges levied through Reservations.com, which obtains its hotel room inventory from Expedia.Reservations.com, says Seattle PI, has brokered over 4 million ‘room nights’ since opening in April of 2014. Expedia collects the site’s payments for lodging, taxes and fees, on top of a $14.99 commission from Reservations.com.After consumers follow through with a reservation and check out of a hotel, Expedia is supposed to remit collected taxes and fees to hotels or local government agencies. But attorneys say that Expedia routinely took more than needed, charging above cities’ rates and pocketing the difference.Seattle Pi recounts the experience of plaintiff Joseph Church, who spent two nights at the Hyatt Regency Orlando.
Court documents claim that Expedia overcharged consumers nearly $100 million through Reservations.com. Image via Pictures of Money/Flickr.
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Class-action lawsuit: Bellevue-based Expedia overcharges customers on taxesExpedia Faces Traveler Fee Lawsuit Alleging Tax Fraud and Racketeering
About Ryan J. Farrick
Ryan Farrick is a freelance writer and small business advertising consultant based out of mid-Michigan. Passionate about international politics and world affairs, he’s an avid traveler with a keen interest in the connections between South Asia and the United States. Ryan studied neuroscience and has spent the last several years working as an operations manager in transportation logistics.