backKing & Spalding achieved a significant victory for Six Continents Hotels, Inc. (“IHG”), persuading the U.S. District Court for the Western District of Washington to dismiss a putative class action alleging anticompetitive conduct by several luxury hotel brands through the use of industry benchmarking reports.
The seven named plaintiffs sought to represent a nationwide class of hotel guests, claiming that IHG and other hotel chains improperly used benchmarking data from Smith Travel Research—owned by CoStar Group—to artificially inflate prices for luxury hotel rooms. Plaintiffs alleged that CoStar reports facilitated the sharing of pricing, supply, and strategic planning information among competitors, resulting in inflated room rates in key markets including Atlanta, Boston, Chicago, San Francisco, and Washington, D.C.
Judge Robert Lasnik granted the motion to dismiss filed by CoStar and the hotel defendants, holding that the plaintiffs failed to adequately allege an antitrust violation. The court emphasized that the CoStar reports did not include pricing information or recommendations, but rather consisted of historical data on room availability and revenue. Judge Lasnik noted that the plaintiffs lacked a “key ingredient” for their claims: evidence that the CoStar reports either required actual room prices as inputs or generated pricing outputs.
The King & Spalding Business Litigation team representing IHG includes Jeff Cashdan, Emily Newton, Lohr Beck, and Caroline Callahan. This dismissal follows a similar win by the same team in March, when the Northern District of Illinois dismissed another putative class action against IHG and other hotel brands.