If you went to sleep in a Ritz-Carlton hotel in New York, Washington, Houston or Aspen, Colo., on the night of Aug. 2, you might have received an extra jolt with your morning coffee: a note under your door with the news that you no longer were staying at a Ritz-Carlton property.

No, this was not a Grade B movie but a bitter dispute turned ugly, pitting a Saudi sheikh against one of the world's best-known names and unfolding both in and outside the courtroom. Claiming it had its reputation to protect, Ritz-Carlton's management teams conducted the midnight raids to strip the four hotels of their name, flags and management teams.


Earlier, the Los Angeles investment company Al Anwa USA, controlled by Abdul Aziz bin Ibrahim al-lbrahim, sued Ritz-Carlton for about $200 million, accusing the chain of inflating occupancy levels to gain higher management fees and of squandering its money -- including $100,000 on a rooftop fete in Washington -- on lavish parties. Ritz-Carlton had filed a breach-of-contract suit accusing the firm of not paying $4 million in management fees and of refusing to attend to such matters as leaky ceilings.

The sheikh said the chain staged the raid on the hotel "to cause the greatest possible disruption at the four hotels and to gain some tactical advantage in the original litigation. Indeed, Ritz-Carlton began taking these steps under cover of darkness on a Saturday, without notice and without adequate preparation for a transition of operations." Ritz left the four hotels without a name and assigned a manager to assist guests. Its action was designed to force a settlement between two parties that clearly had had enough of each other.

Chains occasionally threaten to cut loose wayward properties, but rarely does a spat roll over to the guests rooms. Usually, one party or another elects not to renew a contract.

We tend to forget that, with the exception of a handful of chains, almost every hotel that is built today is owned by one party and managed by another. That dramatic abandonments are almost unheard of is the wonder here.

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