Marriott International, Inc. (MAR) Conspires to Artificially Increase Hotel Room Prices
On March 19, 2018, a class-action lawsuit was filed against Marriott, Choice Hotels, Hilton, Hyatt, InterContinental, and Wyndham for an anti-competitive horizontal agreement to restrain competition prices for consumer hotel room purchases. According to the lawsuit, since 2015, these major hotel chains allegedly colluded together to reduce competition and raise consumer prices for their hotel rooms by agreeing to refrain from using certain online advertising methods to compete for customers. This reduced the consumers’ ability to conduct a comparison between various hotel chains to receive the best price for their rooms and allowed hotel chains to keep prices high without fear of consumers seeing competing advertisements. As a result, consumers paid overcharges on their hotel room reservation purchases and incurred higher transaction costs. Deceitful business practices such as these can negatively impact the value of Marriott’s stock and the goodwill it creates within the community.