Non-profit travel advocacy group Travelers United has filed a lawsuit against a renowned Las Vegas casino operator MGM Resorts International.
The legal action was initiated over the company’s alleged illegal use of resort fees across its US-based properties. According to the advocacy group, the operator was accused of violating the District of Columbia’s Consumer Protection Procedures Act by illegally charging resort fees at its properties.
The Hospitality Giant Faces Serious Accusations
The casino giant is the owner and operator of a property located in Maryland. The MGM-owned casino resort in Forest Heights is very popular among gamblers from DC, as it’s only a short drive away from the nation’s capital.
The fee has many names. Known as a facility fee, destination fee, or amenity fee, it is charged on a daily basis, together with the standard room rate. A fee like this is often charged by casino resorts, but guests often criticize it.
Travelers United claims that MGM advertises its accommodation offering without including the resort fee in the price. According to the lawsuit filed last month, such advertisements contain misleading information. But there’s more, as the renowned hospitality and gaming company was accused of claiming staggering sums of money through “price dripping.” MGM would regularly hide daily room rates from its guest, using the controversial fee. The group claims this practice has been going on for years.
Under the District of Columbia’s existing consumer protection laws, all fees charged by a hotel have to be included in the price. Travelers United pointed out this is a clear breach of the law.
Here’s What the Operator Said
MGM was quick to provide an explanation. According to the company’s website, their guests can use various amenities that enhanced the overall experience by paying resort fees. The list of these amenities includes high-speed Wi-Fi, access to pool and fitness center, the printing of airline boarding passes, and many other services.
According to Travelers United, many of the amenities on offer have been reduced or completely removed from the offering over the last year. However, resort fees stayed the same. The non-profit group said this showed the additional fees weren’t actually charged to provide guests with said amenities. Travelers United added that even non-hotel guests were able to use some of the amenities free of charge.
Nine years ago, the Federal Trade Commission informed providers of hospitality service that “price dripping” represented a breach of federal consumer laws. However, it seems that many operators didn’t take this warning seriously and continued with charging the controversial fee.
The lawsuit’s ultimate goal is to force MGM to include the fees it charges its guests in room prices advertised on the company’s websites and by travel agencies across the US.
News about the lawsuit filed against MGM comes a couple of weeks after Virgin Hotels Las Vegas announced that it wouldn’t be charging any additional fees. The casino resort is ready to start accepting new guests at its Las Vegas-based property, scheduled to open its doors to customers later this month.