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Hotel Junk-Fee Fight Snowballs

Hyatt now faces a class-action suit alleging misleading pricing, and federal legislation has been proposed to drive hotel-cost transparency industry-wide.

For meeting professionals, the best way to protect attendees from the sting of ancillary hotel fees is to try to negotiate them out during the contracting process—or, at least, agree to no new or increased fees after the contract is signed. However, planners are hardly the only ones concerned about “resort fees,” also known as “destination fees,” “amenity fees,” or simply “junk fees” that typically are not disclosed until the moment of purchase and provide little or no added value to the guest.

The latest skirmish involves Hyatt Corp.: A consumer group called Travelers United filed a class-action suit on August 18 claiming that the hotel company’s fees are misleading consumers by not disclosing the full cost of a guest room in the advertised price. The complaint from Travelers United follows a similar lawsuit in May by Texas attorney general against Hyatt for alleged deceptive practices.

While the Hyatt cases are ongoing, pressure is mounting on hotel companies and airlines, as well as banks, entertainment companies, and other organizations to build more transparency into their sales tactics. Here are five junk-fee developments in the news since this spring.

• In April, Pennsylvania's attorney general fined Marriott International $225,000 for not complying with a 2021 ruling that said the company had to make consumers aware of the full cost of their stay at the time of booking. In mid-May, Marriott became the first major hotel chain to disclose all fees early in the purchasing process.

• In April, Rep. Ruben Gallego (D-Ariz.) and Rep. Jeff Jackson (D-N.C.) introduced the Junk Fee Prevention Act (H.R. 2463) to eliminate hidden fees “imposed on consumers when purchasing tickets, hotel rooms, and other forms of entertainment.” The bill would require the full prices of services be provided up front.

• In July, Sen. Amy Klobuchar (D-Minn.), and Sen. Jerry Moran (R-Kan.) introduced legislation aimed squarely at the lodging sector. Called the Hotel Fees Transparency Act, the bill would establish federal guidelines for pricing transparency that would require hotels and short-term rentals to clearly show the full fee-inclusive cost and would make the Federal Trade Commission responsible for pursuing violations.

• In August, the Texas attorney general sued Booking Holdings, which owns travel-booking platforms, Priceline, Agoda, Kayak, and for omitting mandatory fees from the advertised rates. This case could be significant: While Marriott has agreed to disclose fees up front (and other hotel companies may also make that choice), that only pertains to its own distribution channels (websites and call centers). Outside travel-booking platforms continue to show fees at the very end of the booking process.

• Heading into the 2024 elections, observers see Democrats using junk fees as a campaign issue. The Biden Administration has long campaigned against hidden fees, beginning in October 2022, with “The President’s Initiative on Junk Fees and Related Pricing Practices,” which shined a light on fees in the banking, hotel, airline, and auto industries, among other sectors.


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