Class-Action Lawsuit: Six NJ Casinos Accused of Inflating Hotel Room Prices
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Six Atlantic City casinos, many of which also have New Jersey online casinos, were hit with three class-action lawsuits. US District Court Judge Karen Williams is allowing them to be consolidated.
The class-action lawsuits come after the plaintiffs allege that the six locations illegally inflated hotel room rates for years by “conspiring” with a hotel booking software supplier.
They say the overpayments have been going on since 2018.
Brands Involved in the Lawsuit
The defendants include Caesars Entertainment, MGM Resorts International, Hard Rock International, and Cendyn Group. The latter is the hotel booking software company. They’re a Florida-based outfit. The prices are said to have come from an algorithm called “Rainmaker.”
None of the defendants have responded to the claims publicly.
The casinos listed above operate in the following places:
- Caesars: Caesars Atlantic City, Harrah’s Resort Atlantic City, and Tropicana Atlantic City. It also operated Bally’s Atlantic City through 2020.
- MGM: Borgata Hotel Casino
Per court documents, these casinos have controlled 72%-80% of the market since June 2018.
The documents further state that Cendyn used an “anticompetitive scheme,” which resulted in “supra-competitive prices.”
Public data from the NJ Division of Gaming Enforcement shows that rooms in 2019 were an average of $142.11 and were occupied nearly 79% of the time. In 2022, the prices were $177.89 with a 73.4% occupancy rate.
“The anticompetitive nature of this conspiracy was explained by defendant Cendyn’s admonition to casino-hotel defendants “not [to] chas[e] after occupancy growth,” and “avoid the infamous ‘race to the bottom’ when competition inevitably becomes fierce within a market,” the suit claims.
The next step is a teleconference on February 21, 2024.
References
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