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IHG Relicensing Agreement Lawsuit Overview:
- Who: InterContinental Hotels Group (IHG) is asking a federal judge to dismiss a lawsuit filed by 110 Sunport LLC.
- Why: 110 Sunport LLC is a franchisee that no longer wants to abide by rules and regulations set forth by IHG that it previously agreed to.
- Where: The lawsuit was filed in New Mexico federal court.
Six Continental Hotels, Inc. and its wholly owned subsidiary Holiday Hospitality Franchising, LLC (HHF) are asking a New Mexico federal judge to dismiss a lawsuit filed by a disgruntled franchisee.
Collectively known as InterContinental Hotels Group (IHG), the group claims an antitrust lawsuit filed by 110 Sunport LLC is a baseless attempt to get out of a 15-year relicensing agreement it signed only two years ago.
110 Sunport LLC operates a Holiday Inn Express & Suites in Albuquerque, New Mexico, and agreed when signing a relicensing agreement to abide by rules and regulations set forth by the franchisor, according to IHG’s request for dismissal.
“This lawsuit… is a baseless attempt to repudiate and rewrite the contract to which (110 Sunport LLC) agreed,” the request for dismissal states.
IHG Says Rules Provide a ‘Consistent, High Quality’ Experience for Guests
IHG claims the rules put in place and agreed to by 110 Sunport LLC are there to ensure all hotels in the group operate in a uniform manner in order to provide a consistent, high quality experience for guests.
“(110 Sunport LLC’s) scattershot allegations take issue with a variety of contractual rights and conduct on the part of IHG that are entirely consistent with its contractual rights to manage its hotel system in a manner that ensures quality and consistency for guests and protects its brand and the investments of other franchisees,” IHG’s request for dismissal states.
Among 110 Sunport LLC’s grievances is it is required to renovate and update its property too often and at too high of an expense, that IHG imposes fees for property inspections, and that it is only allowed to use IHG-approved telecommunications and wireless internet providers, according to the request for dismissal.
110 Sunport LLC also disagrees with IHG’s marketing programs, booking systems, guest loyalty programs, and placement of advertising dollars, IHG says.
IHG argues, however, that 110 Sunport LLC knew what it was agreeing to when it signed the relicensing agreement and has no basis to now file a complaint.
“(110 Sunport LLC) agreed in numerous places throughout the Relicensing Agreement, and was aware based on its prior experience operating its hotel in the System, that HHF would have wide latitude to control the aspects and requirements of the System,” the request for dismissal states.
IHG argues that breach of contract claims, declaratory judgement claims, New Mexico Unfair Practices Act claims, and Sherman Act claims are all without merit and should be dismissed without leave to amend.
This isn’t the first time IHG has faced class action allegations. A class action lawsuit was filed against IHG back in 2017 by a Mississippi man who claimed the group was responsible for a data breach which exposed thousands of customers’ credit and debit card information.
Do you believe 110 Sunport LLC should be held to the relicensing agreement it signed with IHG? Let us know in the comments!
The InterContinental Hotels Group Relicensing Agreement Lawsuit is 110 Sunport LLC v. Holiday Hospitality Franchising LLC, et al., Case No. 1:21-cv-00844, in the U.S. District Court for the District of New Mexico.
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