Fri Apr 19, 2013 4:06pm EDT

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For Immediate Release

Contact:   Robin Reck, Director of Communications

 Judge grants summary judgment, represents yet another victory for companies

April 19, 2013-The Superior Court of the State of California for the County of Los Angeles ruled decisively in favor of online travel companies (OTCs), affirming once again that OTCs are not subject to the application of lodgings taxes to their services.  The City of Los Angeles initiated the suit on behalf of all cities in California in 2004.  At issue was how much Transient Occupancy Tax (TOT) was to be paid and the definition of a hotel "operator."  Like other cases around the country, the Court found that OTCs pay the remit the appropriate amount of tax owed based on the negotiated rate, and do not own, operate or rent hotel rooms.  

The decision rendered yesterday continues to follow a clear national trend, where state and federal courts have repeatedly rebuffed efforts by state and local governments to attempt to impose hotel occupancy taxes on OTCs for their services, recognizing that OTCs are not hotels, do not operate hotels and are not liable for taxes imposed on hotels.

"Our members maintain the same ambition now as we did prior to litigation: to successfully encourage travelers and tourists worldwide to discover and experience the state of California, which will ultimately drive increased tax revenues to county and state treasuries," said Simon Gros, chairman of Travel Tech: The Travel Technology Association.

This is now the fifth decision in California ruling in favor of the OTCs, two of which have been affirmed by the Court of Appeals, ruling that OTCs do not operate hotels and the amounts the OTCs charge and retain for their services are not consideration received for occupancy.  

Gros continued, "We sincerely hope that these claims will finally be put to rest, so that we can get back into the business of showcasing California as a tourist destination on a global stage."

About Travel Tech

The Travel Technology Association, or Travel Tech, is the association for online travel companies (OTCs) and global distribution systems (GDSs), and is dedicated to connecting consumers and travel providers, eliminating barriers to travel and protecting consumers.  Travel Tech's members include: Amadeus, Expedia, Orbitz Worldwide, Priceline, Travelocity, Travelport and Vegas.com.


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Source: Orbitz Worldwide Inc. – PR via Thomson Reuters ONE

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