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Church v. Expedia Inc.

United States District Court, W.D. Washington, Seattle

June 10, 2019

JOSEPH CHURCH, Plaintiff,
v.
EXPEDIA INC., et al., Defendants.

          ORDER GRANTING DEFENDANTS' MOTION TO COMPEL ARBITRATION AND TO DISMISS THE CASE

          JAMES L. ROBART UNITED STATES DISTRICT JUDGE

         I. INTRODUCTION

         Before the court is Defendants Expedia, Inc. (“Expedia”), EAN.com, LP, Travelscape, LLC, and Hotels.com L.P.'s (collectively, “Defendants”) motion to compel arbitration and to either dismiss the case or stay it pending the completion of arbitration. (See Mot. (Dkt. # 19).) Plaintiff Joseph Church opposes the motion. (See Resp. (Dkt. # 30-1).) The court has reviewed the motion, the parties' submissions filed in support of and in opposition to the motion, the relevant portions of the record, and the applicable law. Being fully advised, [1] the court GRANTS Defendants' motion to compel arbitration and DISMISSES this matter without prejudice.

         II. BACKGROUND

         A. Plaintiff's Reservation

         On June 4, 2017, Mr. Church used Reservations.com, which is not a party to this suit, to make a two-night hotel reservation at the Hyatt Regency Orlando (“the Hyatt”). (Compl. (Dkt. # 1) ¶¶ 46-47.) Mr. Church alleges that he paid a total of $641.97 for his reservation. (Id. ¶ 52.) Mr. Church further alleges that this payment was divided into a $14.99 service fee, a $518.30 room charge, and a $108.68 “Taxes & Fees” charge. (Id. ¶¶ 47, 52.) Mr. Church asserts that two payments appeared on his credit card: one charge appeared to Reservations.com for the service fee, and a separate charge appeared to Expedia for the room charge and the “Taxes & Fees” charge bundled together. (Id. ¶¶ 32, 35.) He further asserts that the service fee was paid to Reservations.com, the room charge was divided between the Hyatt and Defendants, and Expedia paid $67.97 of the $108.68 “Taxes & Fees” charge to appropriate governmental entities but “illegally retained” the $38.71 remainder. (Id. ¶¶ 30, 32, 52.) He alleges that whenever Defendants sell a room through Reservations.com, they inflate the “Taxes & Fees” charge beyond what is actually owed to any governmental authorities and retain the excess funds. (Id. ¶¶ 6, 52.) Mr. Church alleges that Defendants and Reservations.com // were part of a fraudulent conspiracy to “deceive consumers into believing that they were paying a legitimate ‘Taxes & Fees' charge.” (See Id. ¶¶ 22, 50, 74.)

         B. The Terms of Service

         To complete his booking, Mr. Church had to click on a red “Complete Reservation” button. (Patel Aff. (Dkt. # 20-1) ¶ 3.) Next to that red button was the statement: “By clicking the ‘Complete Reservation' button you agree to our Terms of Service and hotel room cancellation policy.” (Id.) The words “Terms of Service” (“Terms”) in that sentence were underlined and provided a hyperlink to the Terms. (Id., Ex. A.)

         The Terms set forth “the terms and conditions of bookings you make with us, including matters concerning pricing, payment, and dispute resolution.” (Id., Ex. B at 5.) A section on “Dispute Resolution” is prefaced with the following statement:

THIS SECTION HAS A SIGNIFICANT IMPACT ON YOUR RIGHTS ESPECIALLY WHEN IT COMES TO HOW DISPUTES BETWEEN YOU AND U.S. GET RESOLVED. PLEASE READ THIS SECTION CAREFULLY.

(Id., Ex. B at 7.) The Terms also states that the customer agrees “to resolve any dispute, claim, or controversy arising out of or relating to your use of our Site, this Agreement, our Privacy Policy or the breach, termination, enforcement, interpretation or validity thereof, or our relationship in connection with the Site or these or previous versions of this Agreement or our Privacy Policy (‘Claim')” by contacting Reservations.com before taking further action. (Id.) If the Claim is not resolved in 60 days, “[a]ny and all Claims will be resolved by binding arbitration, ” except certain claims that may be asserted in small claims court. (Id.)

         C. Plaintiff's Prior Complaint

         Before the present suit, Mr. Church filed a similar putative class action based on the same Reservations.com hotel room booking in the District of South Carolina. (Powell Decl. (Dkt. # 20) ¶ 2, Ex. A (attaching First Amended Class Action Complaint filed on January 23, 2018, in Church v. Hotels.com L.P., No. 2:18-cv-18 (D.S.C.) (“Church I”), Dkt. # 5) (“Church I Compl.”).) Mr. Church alleged breach of contract, constructive trust, unjust enrichment, and conversion and misappropriation claims against two entities doing business as Reservations.com (the “Reservations.com Defendants”), and three of the four Defendants in the present suit. (See Church I Compl. ¶¶ 9-14.)

         In Church I, the Reservations.com Defendants filed a motion to compel arbitration based on the arbitration clause in the Terms, and Mr. Church opposed it. (See Powell Decl. ¶¶ 3-4, Exs. B, C.) The court held that an agreement existed between Mr. Church and Reservations.com as to the Terms on the website. (Id. ¶ 6, Ex. E (attaching order) at 4-5.) The court further determined that all of Mr. Church's claims fell within the “broad scope of ...


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