Judge dismisses Atlantic City casino-hotel price-fixing lawsuit
In the lawsuit, the plaintiffs argued that the use of a revenue-management platform led to overcharging for rooms in Atlantic City. Ultimately, they said, using the platform amounted to price fixing. The plaintiffs allege that hotel owners submit real-time price and occupancy data in a shared software program to set prices.
Caesars Entertainment, MGM Resorts International and others are named in the lawsuit.
US District Judge Karen Williams held that the plaintiffs failed to present sufficient evidence for the lawsuit to move forward.
The judge dismissed the lawsuit with prejudice, meaning it cannot be re-filed. The case is one of several consumer class-action suits brought against casino-hotels alleging a conspiracy to artificially raise room rates. A similar case in Nevada was dismissed, and consumers are appealing that decision.
Hotels used same software, but did not collude
According to a Reuters report, the software at issue is Cendyn’s Rainmaker platform, used as a “shared-pricing brain.”
The plaintiffs alleged the shared pricing constituted a conspiracy to set higher rates in Atlantic City. Cendyn and the hotels countered that there was no direct or circumstantial evidence that the defendants agreed to fix prices. They also said the hotels were not required to accept the software’s pricing recommendations.
The judge agreed with the defendants’ argument.
“Plaintiffs have offered no allegation that directly evinces an explicit price-fixing
agreement,” Williams wrote, “and they thus endeavor to infer a tacit agreement through the Casino-Hotels’ parallel conduct, namely their ‘knowing use of the same Rainmaker software.’
“The question thus before the Court is whether the Casino-Hotels’ common use of the same pricing
software is ‘plausibly suggest[ive of] (not merely consistent with) agreement.’ Defendants articulate various factual deficiencies plaguing the Amended Complaint, all of which they contend preclude a plausible inference of any alleged agreement.”
Case ‘factually and legally incomplete’
Williams concluded the plaintiffs failed to show how the Atlantic City hotels used the allegedly confidential data after it was provided to Cendyn. That missing detail, the court said, makes the consumers’ case “factually and legally incomplete.”
The individual hotels could and did set their own rates. Williams wrote it was “implausible that they tacitly agreed to anything, much less to fix the prices of their hotel rooms,” Williams wrote.