Summary
This 8-K filing from priceline.com Incorporated (now Booking Holdings Inc.) on November 2, 2009, reports a significant jury verdict in a class-action lawsuit brought by the City of San Antonio on behalf of itself and 172 Texas municipalities. The jury found that priceline.com and other online travel companies are responsible for collecting and remitting local hotel occupancy taxes, determining they control hotels under local ordinances. While the jury rejected claims for conversion and punitive damages, it awarded approximately $2.0 million in historical damages through May 2009 against priceline.com and its subsidiary, Travelweb LLC. The company strongly disagrees with the verdict, believing it contradicts the evidence that they do not control hotels. They intend to appeal the decision and are unable to estimate the final judgment amount, which could be substantial given potential penalties and interest. Investors should monitor the appeal process and any further developments regarding the final judgment.
Key Highlights
- 1Priceline.com Incorporated received a jury verdict on October 30, 2009, in a class-action lawsuit filed by the City of San Antonio and 172 Texas municipalities.
- 2The jury determined that priceline.com and other online travel companies control hotels under local occupancy tax ordinances and are thus responsible for collecting and remitting these taxes.
- 3The jury rejected claims for conversion (i.e., pocketing tax money) and punitive damages.
- 4Approximately $2.0 million in historical damages through May 2009 was awarded against priceline.com and its subsidiary Travelweb LLC.
- 5The company believes the verdict is inconsistent with the evidence and plans to appeal to the U.S. Court of Appeals for the Fifth Circuit.
- 6The final amount of the judgment, including potential penalties and interest, is currently undetermined and could be significant.