Expedia, Travelocity Among Companies To Pay City of Anaheim
Unpaid Transient Occupancy Taxes and Penalties

Anaheim, CA (February 17, 2009) - After years of underpaying transient occupancy taxes on hotel rooms, the nation's top online travel companies are being forced to pay the City of Anaheim the difference, plus penalties and interest, said a spokesman for the city's legal counsel, Dallas-based Baron & Budd, P.C. The ruling, handed down on February 9 by Anaheim Hearing Officer Michael Miller is expected to influence a host of similar suits filed on behalf of local governments throughout the country.

"All along, this has been a very clear case of online travel companies cheating local governments by paying taxes only on the purchase price of discounted hotel rooms instead of on the retail price they charge consumers for them," said Patrick O'Connell of Baron & Budd, who tried the case along with William Larson and Paul Kiesel of Kiesel Boucher & Larson; Gary Cruciani and Steve Wolens of McKool Smith; and Moses Johnson, Assistant City Attorney for Anaheim. "They tried to mislead consumers with unclear tax and service fees, but the hearing officer saw right through them."

At issue in the case was the companies' tax liability per the Anaheim Municipal Code - and the assessment of taxes owed over an undetermined period of time. According to the hearing officer, the defendants in the case, Expedia, Hotels.com, Orbitz, Priceline, Hotwire and Travelocity, will be required to pay the 15% transient occupancy taxes on the difference between the wholesale and retail rates of hotel rooms they purchased and resold in Anaheim between 2000-2008, as well as all service fees associated with the transactions.

"This is especially good news at a time when local governments and the taxpayers they represent are feeling the effects of the economy," said O'Connell. "We hope this is the first of many successful rulings to bring much-needed tax revenues back to the communities."

About Baron & Budd, P.C.

For more than 30 years, the law firm of Baron & Budd, P.C. has championed the rights of people and communities harmed by corporate misconduct. With more than 50 attorneys and offices in California, Texas and Louisiana, Baron & Budd enjoys a national reputation as a leader of the plaintiffs' bar, having been repeatedly recognized by the NLJ’s Plaintiffs’ Hot List. The firm represents individuals with mesothelioma and other diseases caused by exposure to asbestos and other toxic substances; water authorities seeking clean-up costs for drinking water contamination; government entities and whistleblowers fighting corporate fraud through Qui Tam and False Claims Act cases; securities investors defrauded by corporate wrongdoing; and consumers in class actions and insurance coverage litigation.