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United States District Court for the Eastern District of Texas, Texarkana Division
August 29, 2019, Decided; August 29, 2019, Filed
Case No. 5:18-cv-153-RWS-CMC
REPORT AND RECOMMENDATION OF THE UNITED STATES MAGISTRATE JUDGE
The above-entitled and numbered civil action was referred [*4] to the undersigned United States Magistrate Judge Caroline M. Craven pursuant to 28 U.S.C. § 636. Before the Court are the following pending motions:
Joint Motion to Dismiss on Behalf of Defendants Hilton Domestic Operating Company Inc., Hyatt Hotels Corporation, Marriott International, Inc., Red Roof Inns, Inc., Six Continents Hotels, Inc., and Wyndham Hotel Group, LLC (Docket Entry # 53);
Defendant Caesars Entertainment Corporation's Motion to Dismiss for Failure to State a Claim (Docket Entry # 55) and supplement thereto (Docket Entry # 159); and
Defendant Choice Hotels International, Inc.'s Motion to Dismiss for Failure to State a Claim (Docket Entry # 56).
The Court, having carefully considered the relevant briefing and hearing arguments of counsel April 17, 2019, recommends the motions be DENIED.
A. Plaintiffs' general allegations
On December 16, 2018, Plaintiff TravelPass Group, LLC and its predecessor or related entities, Reservation Counter, LLC, and Partner Fusion, Inc. (collectively, "Plaintiffs" or "TravelPass") filed this antitrust case against Caesars Entertainment Corporation, Choice Hotels International, Inc., Hilton Domestic Operating Company, Inc., Hyatt Corporation,1 Marriott [*5] International, Inc., Red Roof Inns, Inc., Six Continents Hotels, Inc., and Wyndham Hotel Group, LLC., alleging a horizontal conspiracy among these hotel chains and others to eliminate interbrand competition for keyword internet searches, "which millions of customers use to book hotel rooms online each year." Orig. Compl. (Docket Entry # 1), ¶ 1. The defendants in this case are the "six largest hotel chains in the United States, along with Caesars Entertainment Corporation and Red Roof Inns, Inc." (collectively, "Defendants" or "Defendant Hotels"), which "together control the substantial majority of the hotel rooms in the United States" through "direct ownership or franchising relationships." Id., ¶ 3.
According to the complaint, Defendants, conspiring with one another and with "so-called gatekeeper online travel agencies ('OTAs') like Expedia and others," ("Gatekeeper OTAs") "rigged bids and engaged in a group boycott to eliminate competing paid search advertisements displayed by internet search engines by agreeing not to bid on one another's branded keywords." Id., ¶ 1. Plaintiffs are or were "affiliates" of the Gatekeeper OTAs, "obtaining access to the Defendant Hotels' inventory [*6] via these Gatekeeper OTAs. Id., ¶ 3 (further alleging TravelPass, as one of the major "Downstream OTAs," marketed the Defendant Hotels' rooms online by bidding on branded keywords in auctions conducted by online search engines like Google).2
Full case includes Shepard's, Headnotes, Legal Analytics from Lex Machina, and more.
2019 U.S. Dist. LEXIS 168618 *; 2019 WL 5691996
TRAVELPASS GROUP, LLC, PARTNER FUSION, INC. and RESERVATION COUNTER, LLC v. CAESARS ENTERTAINMENT CORPORATION, ET AL.
Subsequent History: Adopted by, Motion denied by, Objection overruled by Travelpass Grp. LLC v. Caesars Entm't Corp., 2019 U.S. Dist. LEXIS 166542 (E.D. Tex., Sept. 27, 2019)
Prior History: Travelpass Grp., LLC v. Caesars Entm't Corp., 2019 U.S. Dist. LEXIS 142227 (E.D. Tex., May 9, 2019)
Hotels, conspiracy, antitrust, keyword, branded, bidding, allegations, consumers, Defendants', competitor, Gatekeeper, Plaintiffs', advertising, motion to dismiss, Downstream, anti trust law, horizontal, antitrust claim, hotel room, online, prices, anticompetitive, Sherman Act, interbrand, recommends, inventory, proper plaintiff, customers, chains, relevant market