Intellectual Property Law

Expedia and Hotels.com Sue Priceline.com for False Advertising

By Michael Atkins

On May 20, Bellevue-based Expedia, Inc. and Hotels.com, L.P. filed suit in the Western District against rival travel seller Priceline.com Inc. for false advertising. Plaintiffs claim Priceline.com “makes the unqualified claim that consumers can save ‘half off’ or ‘up to half off’ hotel prices with Priceline compared to Expedia and Hotels.com,” which they allege is false and misleading to consumers.

Plaintiffs assert that Priceline.com offers both a “fixed-price” service in which consumers know the identities of the hotels offered, prices, and availability, as well as a “blind-bidding” service in which consumers do not know the identities of the hotels offered, prices, or availability. Plaintiffs allege Priceline.com’s “blind-bidding” service is the only one that may enable consumers to achieve the advertised savings.

In plaintiffs’ words: “Notwithstanding the material and fundamental differences between Priceline’s ‘fixed-price’ service, and it’s ‘blind-bidding’ service, Priceline deliberately blurs the distinction between its two very different services on its website and in its advertising in order to mislead consumers into believing that they can achieve the advertised savings with any hotel reservation on the Priceline website when in fact the advertised savings are available, if at all, only on Priceline’s ‘blind-bidding’ service. Indeed, because Priceline’s website features both fixed-price and ‘blind-bidding’ services, Priceline’s unqualified price savings claims are false and misleading.”

Priceline.com has not yet answered plaintiffs’ complaint.

Priceline.com’s Web site states: “Priceline’s Name Your Own Price® reservation service is different from fixed-price travel sites like Hotels.com and Expedia.com. With Priceline’s Name Your Own Price® reservation service, the exact hotel is shown only after purchase. Percent savings claim above applies to Name Your Own Price® hotel purchases only and are as compared to the published prices shown on Hotels.com and Expedia.com for the same hotels and the same dates.”

The case cite is Expedia, Inc. v. Priceline.com Inc., No. 09-712 (W.D. Wash.).

Full post as published by Seattle Trademark Lawyer on June 01, 2009 (boomark / email).