Resort Fee Charges and Deceptive Advertising

After a recent stay at the Palazzo in Las Vegas, a Studio City, CA man was shocked to see he was charged $28 per night for a “resort fee.” He booked his room through a popular hotel booking site and was not informed of the additional charge. This lead him to file a class-action suit naming the Las Vegas Casino Hotel claiming that the hotel was guilty of false and misleading advertising and not properly disclosing the mandatory fee at the time he booked his room.

Charging a resort fee is a common practice in Las Vegas and in many other cities.   The Federal Trade Commission has contacted at least 22 hotels in 2012 warning them that they may be in violation of the law and are providing consumers deceptively low estimates of what they will pay for their hotel rooms.

The U.S. Department of Transportation imposes fines on airline when they fail to disclose the full cost of airfare, but there are simply too many hotels in the U.S. for the Federal Trade Commission to monitor.

Chances are your property doesn’t have resort fees (yet!), but this case is helpful in pointing out how careful hospitality property owners need to be when advertising property charges and features.

Here’s wishing you a profitable month as the market continues to improve this Spring!