Hotwire Agrees to International Car Rental Fee Class Action Settlement

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Hotwire Inc. has agreed to settle a class action lawsuit that accuses the company of misleading consumers by providing an estimated price for international car rentals that did not include insurance fees and taxes.

Daniel Shahar initially filed the Hotwire class action lawsuit on Nov. 27, 2012, claiming that the company misinformed consumers about the taxes and fees they would be required to pay when renting cars internationally.  He alleged Hotwire not only provided customers with an “Estimated trip total” that excluded taxes and fees the customer would actually have to pay, the company also informed the customers that the estimated taxes and fees would be equal to $0.00.

Shahar’s class action lawsuit originally targeted both Hotwire and its parent company Expedia. However, the companies successfully moved to dismiss the litigation. Shahar subsequently filed an amended class action lawsuit that listed Hotwire as the sole defendant. Hotwire sought unsuccessfully to dismiss the class action lawsuit a second time. After an informal discovery process, the parties began mediation and reached a settlement earlier this year. The final class action settlement agreement was signed on March 13, 2014.

According to the Hotwire class action settlement documents filed Friday in California federal court, the plaintiff is seeking preliminary approval of the settlement agreement and certification of a class of people and entities who made a reservation through Hotwire’s website after Nov. 27, 2008, while still in the United States, for a car rental in a foreign country and received confirmation that the estimated amount of taxes and fees equaled $0.00.

The Hotwire class action settlement documents state that 1,089 Class Members will be eligible to receive benefits. This number is based on a spreadsheet generated by Hotwire’s computer system identifying customers who received confirmation from Hotwire that their estimated taxes and fees would be equal to or less than $0.00.

Under the terms of the proposed class action settlement, Hotwire will pay $130,000 to resolve the litigation. According to the court documents, this amount is more than the estimated revenue the company earned from the allegedly misleading transactions at issue in the litigation. Further, the class action settlement provides injunctive relief that will require Hotwire to ensure consumers are fully informed about the taxes and fees they will incur when renting cars internationally through the Hotwire website.

In his motion supporting the preliminary approval of the Hotwire care rental fee class action settlement, Shahar says that he “is pleased to report that he has reached a settlement with Hotwire that squarely addresses the Settlement Class’s concerns and provides to the Class Members remedies similar to what they could otherwise have expected to receive if the case were successfully tried, but without the delay and risks associated with trial and the appellate process.”

More information about how to file a claim for the Hotwire class action settlement was not immediately available. Keep checking TopClassActions.com or sign up for our free newsletter for the latest updates. You can also mark this article as a “Favorite” using your free Top Class Actions account to receive notifications when this article is updated.

The plaintiff is represented by Cory S. Fein, Michael A. Caddell and Cynthia B. Chapman of Caddell & Chapman.

The Hotwire International Car Rental Fee Class Action Lawsuit is Daniel Shahar v. Hotwire Inc., Case No. 4:12-cv-06027-JSW, in the U.S. District Court for the Northern District of California.

UPDATE: The fairness hearing for the Hotwire international rental car class action settlement is scheduled for July 25, 2014. Class Members who changed mailing addresses should update them at https://www.shaharsettlementaddressupdate.com/Request. For more information about the Hotwire class action settlement, click here.