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Update:
- A lawsuit alleging that Las Vegas Strip hotel operators collaborated to fix prices failed to advance in a federal court in Nevada because the judge says it missed key specifics to justify the claims.
- U.S. District Judge Miranda M. Du says the lawsuit claimed the named hotel operators, including MGM, Wynn, Caesars and Treasure Island, used software from the Rainmaker Group or Cendyn but did not state which specific software each resort uses and therefore did not allege the resorts used the same software.
- Judge Du also says the lawsuit did not state when the hotels began using the software or when they would have entered into an agreement to use noncompetitive prices and did not provide the necessary details to assert the claims of unfair business practices.
- Du will allow the plaintiffs to amend the complaint and potentially add details to state the case and charges more clearly, especially a claim called a “rule of reason” theory that allows for a measurement to see if a deal is non-competitive.
Las Vegas hotel prices class action overview:
- Who: Two hotel customers are suing a number of hotel operators on the Las Vega Strip.
- Why: The plaintiffs allege the companies have an unlawful agreement to artificially inflate the prices of their hotel rooms.
- Where: The Las Vegas hotel prices class action was filed in a Nevada federal court.
(Jan 30, 2023)
A group of major hotel operators on the Las Vegas Strip have an unlawful agreement to artificially inflate the prices of hotel rooms above competitive levels, a new class action lawsuit alleges.
Plaintiffs Richard Gibson and Heriberto Valiente filed the class action lawsuit against Caesars Entertainment Inc., Treasure Island LLC, Wynn Resorts Holdings LLC, Rainmaker Group Unlimited Inc. and MGM Resorts International on Jan. 25 in a Nevada federal court, alleging violations of fair competition laws.
According to the lawsuit, the defendants are responsible for operating the vast majority of the hotels on the Las Vegas Strip, including well-known hotels such as the Bellagio, Wynn, Caesars Palace, MGM Grand and Mandalay Bay.
Instead of competing with one another, the hotel operators have replaced their independent pricing and supply decisions with a shared set of pricing algorithms that allow them to collect supracompetitive prices for their hotel rooms, the lawsuit alleges.
Tech company provides hotel operators with pricing algorithms, lawsuit alleges
The company that provides the pricing algorithms for Hotel Operators is Rainmaker Group; it is also named as a defendant in the lawsuit.
According to the plaintiffs, the vast majority of hotels on the Las Vegas Strip now use Rainmaker Group’s pricing algorithms.
The hotels provide real-time pricing and supply information to the Rainmaker Group, which the company feeds through its algorithms and then generates forward-looking, room-specific pricing recommendations to send back to the hotels, the lawsuit alleges.
“In a competitive market, any empty hotel room is lost revenue, so a hotel operator would try to fill each hotel room by granting concessions or lowering prices,” the lawsuit says.
“By contrast, on Rainmaker Group’s recommendations and as an integral part of the conspiracy, Hotel Operators kept prices high and some rooms empty, knowing their co-conspirators would not undercut these supracompetitive prices,” the class action alleges.
The plaintiffs seek to represent anyone who rented a room from one of the operators participating in Rainmaker from Jan. 24, 2019, to now.
They’re suing under the Sherman Act and seek certification of the class action, damages, fees, costs, an order blocking the companies from engaging in the alleged scheme, and a jury trial.
Meanwhile, a former MGM Resorts International employee is suing the company he worked for, alleging he was discriminated against and fired for not getting the COVID-19 vaccine due to his religious beliefs.
Did you book a room on the Las Vegas Strip in the last four years? Let us know your thoughts on this lawsuit in the comments.
The plaintiffs are represented by Brian J. Panish, Rahul Ravipudi and Ian Samson of Panish Shea Boyle Ravipudi LLP and Adam Ellis, Steve W. Berman, Stephanie A. Verdoia, Rio S. Pierce and Hannah K. Song of Hagens Berman Sobol Shapiro LLP.
The Las Vegas Strip hotels price-fixing class action lawsuit is Richard Gibson, et al. v. MGM Resorts International, et al., Case No. 2:23-cv-00140, in the U.S. District Court for the District of Nevada.
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97 thoughts onJudge dismisses class action over Vegas hotel price-fixing
I stayed at Treasure Island at May 2022 and see the prices are advertised differently on the rooms than when you book a room
I was charged resort fee’s at Treasure Island. You would think when you book your trip through the hotel which was airlines, room and shuttle back & forth to the airpor. I Paid 240ore for fees when I got there. wendyakins453@yahoo.com
Yes I have booked a hotel rm on the strip during this time period.
I was charged resort fees at two different Las Vegas hotels in the last 2 years.
My husband and I have been going to Vegas for almost 30 years every February to celebrate his birthday. The fees are ridiculous!
The prices of hotels maybe tripled the usual amount of pay it costs. They definitely ripped off and took as of anyone that stayed in their hotel rooms.