At the start of summer, our eyes focused on a court ruling some 2,500 miles away in Nevada. It was there that a US District Court judge tossed out a class action lawsuit against some Las Vegas hotel casinos.
Why did we pay attention? Because that case carried similarities to one here in New Jersey, potentially providing an indication of what could occur in the Garden State.
As it happened, that lawsuit against operators of several casinos in Atlantic City — alleging the casinos and an online room booking platform conspired to overcharge room rentals using a price-fixing algorithm — was also dismissed by a US District judge this week.
In fact, Judge Karen Williams dismissed the lawsuit with prejudice. As a result, it cannot be filed again.
Not enough evidence to move forward with price-fixing lawsuit
The lawsuit, originally filed in 2023, named Caesars Entertainment, MGM Resorts International, and Hard Rock International as co-defendants. Of course, the filing also included their affiliated casino properties:
- Caesars Atlantic City
- Harrah’s Atlantic City
- Tropicana Atlantic City
- Borgata Atlantic City
- Hard Rock Atlantic City
Plaintiffs claimed that the casino hotel operators and a Florida-based hospitality technology company that provided room-booking software purposefully charged more for room rentals using a price-fixing algorithm, a scheme that dates back to 2018, according to the complaint.
In addition to the lawsuit, the Federal Trade Commission and the Antitrust Division of the Department of Justice supported the plaintiffs, issuing a statement that the casino hotel operators may have broken antitrust laws.
However, the co-defendants successfully persuaded Williams to dismiss the case with prejudice. The judge ruled that the consumers failed to present enough evidence to allow the lawsuit to move forward, similar to the decision made in Nevada a few months ago.
Plaintiffs in the Nevada case have appealed their ruling.
‘Implausible’ that Atlantic City casinos conspired together
Consumers in the New Jersey lawsuit alleged that the “Rainmaker” software from Cendyn represented the “shared pricing brain” that “does all the hard work for them.”
However, co-defendants emphasized that no evidence exists that proves they conspired to fix prices. What’s more, the Atlantic City casinos did not have to accept the price recommendations from the software.
Williams agreed with the co-defendants, concluding that the plaintiffs failed to prove the casinos conspired together. Without proof of how the hotels used the recommendations from Cendyn, Williams determined that the case was “factually and legally incomplete.”
As the hotels have the ability to set their own rates, Williams added, it seemed “implausible that they tacitly agreed to anything, much less to fix the prices of their hotel rooms.”
