MGM Faces DC Lawsuit from Travelers’ Group Over Resort Fee Practice

Posted on: March 11, 2021, 10:24h. 

Last updated on: March 11, 2021, 02:49h.

A nonprofit organization that represents travelers’ interests has filed a lawsuit in the District of Columbia against MGM Resorts International. The suit claims the hospitality and gaming company deceives customers by hiding resort fees

MGM resort Fee lawsuit
An aerial view of the MGM National Harbor Resort in Forest Heights, Md., located just outside Washington, DC. Las Vegas-based MGM Resorts International faces a lawsuit in a local DC court over its practice of charging resort fees to customers. (Image: MGM Resorts International)

Travelers United said the Las Vegas-based company employs “drip pricing” at its resorts. That means it does not reveal the true price for a room either on its site or third-party sites like Priceline or Expedia. That has led the company to reap “hundreds of millions of dollars” over the last 10 years.

Further, it claims the amenities that the resort fee purportedly covers are either “obsolete or services provided as free” to other guests. Those services include unlimited local and toll-free calls, which the group claims is obsolete since 96 percent of Americans have cell phones.

If an MGM property closes its gym for whatever reason, MGM still charges a resort fee, it claims.

There is no exchange of service with a resort fee,” the lawsuit states. “A customer of the defendant’s is not allowed to refused the alleged services of the resort fee in an attempt to not pay the resort fee. Defendant forces a customer to pay the resort fee in order to receive the key to the customer’s room.”

The group actually filed the suit on Feb. 17 in DC’s Superior Court. However, Travelers United did not publicize the suit until it sent a tweet on it Wednesday night.

Lauren Wolfe, a lawyer for Travelers United, told the organization wanted to confirm MGM received the suit before announcing it.

A spokesman for MGM Resorts told the company had no comment on the case.

Suit Says DC Taxpayers Paid Fee for Councilman’s Stay

Travelers United filed the suit in a local DC court, meaning it only covers Washington, DC. It is not a federal lawsuit.

It claims MGM forces DC residents to pay for resort fees even if they’ve never been to an MGM establishment.

The complaint notes that in May 2019, DC’s mayor and several members of the DC Council attended an International Council of Shopping Centers convention in Las Vegas. Those members included Trayon White, Sr. He and his legislative director stayed at the MGM Grand Hotel and Casino on the Strip.

An unnamed travel company booked the reservations for them, with the rooms costing $2,476.46. However, the complaint states that when White and his aide got to the hotel, they received a separate bill for the resort fee, which amounted to $335.60.

The group claims the resort fee violates DC’s Consumer Protection Procedures Act. The law prohibits companies from employing unlawful tactics regarding the sale of goods or services.

The group claims MGM uses resort fees in at least 17 of its US resorts. Fees range from $15 to $45 per day.

The company does not operate a property in DC. The closest is MGM National Harbor in Forest Heights, Md., located just outside the District. However, the company markets its properties to DC residents using these practices, the suit claims.

Seeks Ban on Resort Fee Practice

Travelers United seeks to permanently bar MGM Resorts from showing room rates that do not include resort fees in advertisements. It also wants the company to pay damages to the organization for each violation proven during the trial. In addition, it seeks punitive damages and the organization’s legal fees.

It’s also requesting a trial by jury.