The lawsuit alleged that hotels were inflating room prices through the use of a collaborative revenue management system
A legal fight over supposed price-fixing in Atlantic City hotels has ended, with big casino hotel companies, like Caesars Entertainment and MGM Resorts beating the claims.
Cendyn’s Rainmaker Software Under Scrutiny as Hotel Pricing Controversy Unfolds
US District Judge Karen Williams, who handled the case in Camden, New Jersey, threw out the proposed class action, reported Reuters. The lawsuit claimed that hotels were driving up room prices using a shared revenue management system.
Consumers filed a lawsuit against hotels claiming they worked together on Cendyn’s “Rainmaker” software to plan their pricing. The people suing said this system let hotels share private info, like current room prices and how full they were. They argued this helped hotels set prices in a way that cut down on competition and made stays more expensive for guests.
Earlier this year, the lawsuit also received support from federal regulators who showed interest in the legal proceedings.
However, Judge Williams decided that the plaintiffs did not provide enough proof to back up their claims about price-fixing. The court thought the consumers’ idea lacked facts about how hotels used the private data once the software platform got it. The judge stressed there was no clear evidence that hotels had agreed to follow Rainmaker’s pricing suggestions or that they had worked together on their pricing plans.
Wave of Dismissed Hotel Price-Fixing Lawsuits Reflects Industry-Wide Legal Battle
This decision is part of a bigger legal pattern, as people have filed similar lawsuits against hotel companies all over the US. A connected case in Nevada involving other big names like Wynn Resorts also got thrown out earlier this year, but those who sued have since challenged that decision. Both lawsuits claimed that hotels used AI-powered systems to work together on pricing, which the people suing called a new kind of price-fixing.
Despite the accusations, Cendyn and the hotel operators have always said they did nothing wrong. They say the hotels can still choose their own room prices and that no one made an illegal deal to fix prices. The defendants also pointed out that while the tech might help with pricing choices, it does not force all competitors to charge the same.
The New Jersey casegot thrown out for good, which means the people suing cannot try again. This counts as a big win for the hotel operators. This result could also affect other lawsuits in the hotel business where people are taking a closer look at pricing software and AI tools.
