(Wyndham)

A federal judge has rejected efforts by international hotel chain Wyndham Hotels and Resorts to throw out a proposed class action lawsuit against it over claims that its website didn’t tell customers the full cost of their reservations before booking.

U.S. District Judge Mark R. Hornak of the Western District of Pennsylvania on Wednesday denied claims by the hotel chain that the plaintiff did not suffer any actual losses as outlined in New Jersey’s Consumer Fraud Act, or the state’s Truth-in-Consumer Contract, Warranty and Notice Act—a contentious law governing e-commerce disclaimers that has recently been causing a headache for retailers.

Although the hotel group argued that the plaintiffs only suffered a “bare procedural violation and not a concrete injury,” Hornak determined that, according to the allegations, the online terms of use agreement improperly limited the plaintiff’s right to recovery, and the allegedly incorrect price led the plaintiff to buy a room he would not have purchased otherwise.

“Plaintiff’s complaint identifies the advertised cost of the room, allegedly undisclosed or misrepresented costs and taxes, and the final cost stated on the invoice presented after his hotel stay,” Hornak said. “The present plaintiff’s allegedly defeated expectations relate to the price that he was led to believe that he would pay for the product versus the price ultimately charged, and not a deficiency in or misrepresentation about the nature of the product itself.”

Although Hornak’s ruling allowed the majority of the proposed class’ claims to go forward against Wyndham Hotel Group and Wyndham Hotels and Resorts, the ruling also determined that the plaintiff did not fully establish a connection for liability purposes between the website and defendants Wyndham Worldwide Corp. and Wyndham Hotel Management Inc. However, Hornak said the plaintiff could amend his complaint to outline more specific allegations.

According to Hornak, plaintiff Thomas Luca Jr. sued the hotel chain on behalf of a proposed class on allegations that it failed to properly disclose the tax levied on the resort fee. He contended he did not know of the tax until he received a final invoice after he had stayed in the hotel.

Luca filed his complaint in June, and oral arguments were held in November over Wyndham’s motions to dismiss the complaint.

Along with contending that the injury was not sufficient to sustain the claims, Wyndham also contended that New Jersey law should not apply to the case because the harm allegedly occurred outside the Garden State.

Although Luca cited the fact that the terms of use provision on the website designated that New Jersey law would govern the use of the website, Wyndham noted that Luca had stayed at the Shelborne Grand South Beach hotel in Miami, and argued that the harm occurred with the hotel reservation, not the use of the website.

Hornak, however, said Wyndham’s argument “too finely slices the facts.”

“Plaintiff’s claims are fairly read as arising out of his use of the website, and thus are covered by the terms of use and their directive that New Jersey law applies,” Hornak said.

Both Erin Comite of Scott & Scott in Colchester, Connecticut, and Kenneth Winn Allen of Kirkland & Ellis in Washington, D.C., who represented Wyndham, did not return a call for comment.

Max Mitchell can be contacted at 215-557-2354 or mmitchell@alm.com. Follow him on Twitter @MMitchellTLI.

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