A nonprofit travel advocacy group is suing MGM Resorts International, alleging that the hospitality group's resort fees are in violation of the District of Columbia's Consumer Protection Procedures Act.
Filed last month with the D.C. Superior Court, the complaint from Washington-based Travelers United accuses MGM Resorts of engaging in "deceptive 'drip pricing'" tactics, in which the company initially hides a portion of a room's daily rate during the shopping process, categorizing this hidden sum as a "resort fee."
According to Travelers United, drip pricing results in consumers being "mislead into believing an MGM hotel room is cheaper than it actually is."
The organization claims that MGM Resorts currently charges a resort fee at all of its U.S. properties, which include the Maryland-based MGM National Harbor, located just outside of Washington, as well as the MGM Grand, Bellagio, Aria, Mandalay Bay, New York-New York and Luxor properties in Las Vegas, among others.
"Resort fees are a clear violation of D.C.'s consumer protection laws," said Lauren Wolfe, counsel for Travelers United, in a statement. "It is time to end the abhorrent practice of illegal resort fees by the hotel industry. All mandatory hotel fees must be included in the advertised price in order to be legal."
Travelers United has also taken issue with the fact that many of the amenities MGM Resorts claims are covered under its resort fees have been reduced or eliminated during the Covid-19 pandemic.
"This shows that clearly there is no correlation between amenities and resort fees," said Travelers United.
MGM Resorts declined to comment on the allegations.
The Travelers United complaint is one of several high-profile drip pricing-related lawsuits to be filed against major hospitality players in recent years. In 2019, the D.C. attorney general filed a lawsuit against Marriott International, accusing the hotel giant of deceptive fee practices. Nebraska's attorney general sued Hilton on similar grounds later that same year.
A bipartisan group of lawmakers introduced the Hotel Advertising Transparency Act into Congress in late 2019, aiming to curb deceptive pricing in the accommodations space. Though the bill was assigned to the House Committee on Energy and Commerce, the legislation has yet to move forward with a hearing.