NJ Casino Hotels Facing Class-Action Lawsuit Over Antitrust Conspiracy

Summary:

• Atlantic City casino hotels have been accused of conspiring to keep room rates artificially high
• They allegedly carried out the scheme using a shared pricing platform
• A similar lawsuit was filed in January in Las Vegas

Atlantic City have been struggling since the pandemic but things are getting a lot worse as several are now being hit by a lawsuit accusing them of conspiring to boost room rates. Among those named as defendants in the case are MGM Resorts International, Hard Rock International Inc. and Caesars Entertainment Inc.

Lawsuit Alleges Casino Hotels Engaged in Price Fixing Scheme

The lawsuit, filed this week by New Jersey residents Heather Altman and Eliza Wiatroski, allege that the companies in question and their hotels in Atlantic City participated in a scheme to set higher room rates using a shared pricing platform designed by Florida-based hospitality technology firm Cendyn Group LLC, which was also included in the list of defendants. Such practice breaches the U.S. antitrust law, according to the lawsuit.

The plaintiffs point to significant increases in room rates at various casino hotels in Atlantic City, including Borgata, Harrah’s, and Bally’s, from 2018 to present. In particular, prices were 25% higher in 2022 than in 2019, but the number of rooms rented out was 5% fewer, the suit claims.

The rate increases are unreasonable, and there are no market factors to back them up, the plaintiffs allege. The defendants have been accused of knowingly giving false information to their patrons as to how they came up with the rates.

The complainants are seeking to have their case certified as a class action, saying that hundreds of thousands of customers may have fallen victim to the alleged conspiracy. They demand compensatory and triple damages under U.S. antitrust laws.

Caesars, MGM Resorts, Hard Rock, and Cendyn have yet to comment on the lawsuit. The complainants are represented by lawyers from Susman Godfrey, Burns Charest and Lite DePalma Greenberg & Afanador.

Similar Case In Las Vegas

A similar case was filed by two tourists in January 2023 against Caesars, MGM, and other casino hotels in Las Vegas. The lawsuit accuses the operators of being involved in a price-fixing scheme to keep room rates artificially high via a shared pricing platform supplied by Cendyn Group LLC. The company was also listed as a defendant, alongside Wynn Resorts. The suit is also seeking damages and class action status.

In March, the defendants in the case sought to have the lawsuit dismissed, arguing that the plaintiffs failed to provide strong evidence to support their allegations and were unable to identify a single communication between the alleged conspirators.