A recent legal battle over alleged price-fixing practices among Atlantic City hotels has come to an end, with major casino hotel companies such as Caesars Entertainment and MGM Resorts emerging victorious against the claims.
The lawsuit, which was handled by US District Judge Karen Williams in Camden, New Jersey, was centered around accusations that hotels were artificially inflating room prices through the use of a collaborative revenue management system. The proposed class action lawsuit was ultimately dismissed by Judge Williams, as reported by Reuters. The lawsuit alleged that hotels were utilizing Cendyn’s “Rainmaker” software to coordinate pricing strategies, allowing them to share sensitive information such as current room prices and occupancy rates. This collective approach was said to reduce competition and drive up prices for guests.
Earlier this year, the lawsuit garnered attention from federal regulators who expressed interest in the legal proceedings. However, Judge Williams ruled that the plaintiffs failed to provide sufficient evidence to support their claims of price-fixing. The court found that the consumers’ arguments lacked detailed information on how hotels actually utilized the shared data from the software platform. There was no clear evidence presented to show that hotels had agreed to implement Rainmaker’s pricing recommendations or that they had colluded in setting prices.
This case is just one example of a larger legal trend, with similar lawsuits being filed against hotel companies across the country. A related case in Nevada involving Wynn Resorts and others was also dismissed earlier this year, though the plaintiffs have contested that decision. These lawsuits all revolve around allegations of hotels using AI-powered systems to coordinate pricing strategies, which the plaintiffs have labeled as a new form of price-fixing.