Booking.com Settles $9.5 Million Lawsuit Over Hidden Hotel Fees in Texas

• Booking Holdings, parent of Booking.com, agrees to a $9.5 million settlement with Texas over undisclosed hotel fees, marking the largest case of its kind in the U.S.
• The settlement mandates upfront disclosure of all mandatory fees, aligning with federal efforts to standardize price displays.

As reported by Reuters, in a significant development for the hotel and travel industry, Booking Holdings, the parent company of Booking.com, has agreed to a $9.5 million settlement with Texas over allegations of deceptive marketing practices. The lawsuit accused the company of enticing consumers with artificially low prices by omitting mandatory “junk” fees, such as resort and amenity charges, from the initial price display.

Texas Attorney General Ken Paxton announced the settlement, highlighting it as the largest case in the United States related to such practices against any hotel or online travel agency. The lawsuit claimed that Booking.com engaged in “drip pricing,” where additional fees were bundled into a single line item at checkout, giving the company an unfair advantage over competitors who did not employ such tactics.

As part of the settlement, Booking Holdings has agreed to disclose all mandatory fees upfront, ensuring greater pricing transparency for consumers. This move aligns with recent Federal Trade Commission (FTC) efforts to standardize price displays in the travel industry.

Booking Holdings, which also operates Priceline.com and Kayak, denied any wrongdoing but emphasized its commitment to transparency and providing accurate information to consumers. The company noted that while hotels typically set and retain resort fees, it supports initiatives to bring consistency to pricing displays.

This settlement follows similar agreements reached by the Texas Attorney General with hotel chains like Choice, Hilton, and Marriott earlier in 2023. The crackdown on hidden fees has been a priority for consumer protection advocates, with the FTC introducing a Junk Fees Rule in December, requiring upfront disclosure of total prices by hotels and other service providers.