US: Benchmarking firm STR, owned by CoStar Group, together with 10 resort firms, face a lawsuit claiming that the “alternate of competitively delicate data” permits operators to set excessive costs.
Seven plaintiffs have filed a lawsuit towards STR and its shoppers for inflating costs inside luxurious resort metropolitan markets in the USA.
The lawsuit claims: “Opponents within the luxurious resort business have agreed to repeatedly share their detailed, audited, competitively-sensitive details about their costs, provide, and future plans by means of an middleman, Smith Journey Analysis (STR), which is owned by defendant CoStar Group. The aim of this alternate is for opponents to share “super-timely income and occupancy information” in order that opponents can guarantee they’re getting their “justifiable share” of revenues.
“In different phrases, the alternate of this data permits taking part motels to set costs increased than they might have been absent this settlement to alternate data. That is value fixing in its fashionable kind and is unlawful underneath the Sherman Act.”
The lawsuit highlights that STR collects three kinds of information from its resort shoppers: rooms accessible; rooms bought; and room income. Every taking part resort will submit further particulars together with the kind of traveller (transient, group and contract) in addition to income (room, meals and beverage, and different). STR additionally collects motels’ forward-looking occupancy information, together with rooms accessible and rooms booked.
Along with CoStar and STR, defendants named within the lawsuit embrace Hilton, Hyatt, IHG, Loews, Marriott and Accor. Co-conspirators embrace Alternative, Nice Eagle Holdings, Wyndham and Omni.
Proof within the lawsuit options the longer term itemizing costs from 6,000 motels throughout 15 cities within the US, between January and June 2024. The outcomes confirmed an “common overcharge of at the very least 4.3 per cent” for five-star motels after accounting for resort traits, location, and high quality.
It additional notes that the defendants and co-conspirators “possess a median of 70 per cent market share throughout all 15 cities”.
Filed on 20 February 2024, the plaintiffs have demanded a trial by jury.
