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A small hotel has brought a suit against travel company Expedia alleging that it used underhanded tactics in order to siphon booking business to its partner hotels instead.
The case is currently in the courts being reviewed for class action certification. Causes of action include false advertising, unfair competition and -- of course -- "bait and switch" business tactics.
How the "Bait and Switch" Works
The way the alleged scheme works is like this. Expedia entices users to click on their banners by advertising great deals in hotels with which the company has no affiliation or partnership agreement. The customer clicks on the advertisement only be to informed that all the rooms in the hotel offering the great deal are booked up -- but wait! Here are other Expedia partnered hotels!
In short, Expedia had no partnership agreement with many of the hotels that appear in ads. The complaint alleges, inter alia, that Expedia merely purchases social media advertising and content for those names in an effort to crowd out searches for those businesses.
"Expedia's website falsely shows that there is no availability at the hotel, but then pushes the consumers to 'deals' at Expedia's nearby member hotels, who pay Expedia a fee for every room booked through its website," the complaint says. "The deception starts even before consumers visit the websites. Defendants purchase false and misleading advertisements on internet search engines like Google, to funnel traffic to their websites. ... Expedia's deceit is brazen."
The complaint goes on to further describe the site faking contact numbers for many of the non-partnered hotels: "Expedia posts fake telephone numbers for Buckeye Tree Lodge and other Class Member hotels to divert callers to Expedia's own operators, who then try to book the consumers at Expedia member hotels."
The good people over at GeekWire decided to do a little investigating of their own. When they attempted to contact one of the Hotels through the number listed on Expedia, they were routed through to Expedia Central Reservations. They called back twice and eventually both calls were lost. Now that's customer service.
No Word From Defendants
Courthouse news reports that the defendants have not responded to requests for comments. We'll see how this one goes. We'd love to see how general counsel wiggles their way out of this one.