News

By Mike Scarcella

Feb 21 (Reuters) - Commercial real estate information giant CoStar CSGP.O has been sued in a proposed consumer class action accusing it and a group of luxury hotel operators, including Hilton HLT.N, Hyatt H.N and Marriott MAR.O, of conspiring to keep room rental prices artificially high.

Seven residents of California, Florida, Illinois and other states filed the lawsuit in Seattle federal court on Tuesday, seeking damages under U.S. antitrust law for alleged room price overpayments.

The lawsuit accused the hotels of sharing competitively sensitive, commercial information through CoStar’s Smith Travel Research (STR) reports that show “performance benchmarking and comparative analytics” for the industry.

The defendant hotels shared prices, supply and future plans, allowing participating companies to use rivals’ strategic information to inflate prices in Washington, D.C., San Francisco, New York, Nashville, Chicago, Boston, Austin and other cities, according to the lawsuit.

“Teddy Roosevelt passed the antitrust laws to prevent titans of industry from price fixing in smoke-filled rooms,” the plaintiffs' lead attorney Steven Berman told Reuters, calling the defendants' conduct the "modern equivalent."

Other defendants include InterContinental Hotels IHG.L, Loews L.N and the U.S. subsidiary of Accor ACCP.PA, the French multinational hospitality company.

Representatives from CoStar, Hilton, Hyatt, Marriott, InterContinental Hotels, Loews and Accor did not immediately respond to requests for comment on Wednesday.

The lawsuit seeks class-action status for potentially hundreds of thousands of people who rented rooms from a defendant or alleged co-conspirator hotel from February 21, 2020, through the present.

The allegations are based partly on information from confidential witnesses, including a software engineer at STR and a market director of revenue management at Marriott Ritz-Carlton Hotels, the lawsuit said.

The plaintiffs’ law firm, Hagens Berman Sobol Shapiro, has brought similar data-related price-fixing lawsuits against hotels in Las Vegas and rental property management companies. Those cases are ongoing.

The case is Jeanette Portillo et al v. CoStar Group et al, U.S. District Court for the Western District of Washington, No. 2:24-cv-00229.

For plaintiffs: Steve Berman, Theodore Wojcik and Xiaoyi Fan of Hagens Berman Sobol Shapiro

For defendants: No appearances yet

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