Expedia 2012 Annual Report Download - page 43

includes claims for declaratory judgment, injunctive relief, violations of state sales tax statute and local
ordinances, violation of Consumer Protection Act, conversion, unjust enrichment, constructive trust, money had
and received and joint venture liability. On March 23, 2012, the defendant online travel companies filed a motion
to dismiss. On September 20, 2012, the court denied the online travel companies’ motion to dismiss.
Kalamazoo County, Michigan Litigation. On August 23, 2012, Kalamazoo County, Michigan brought suit
against a number of online travel companies, including Expedia and Hotels.com, County of Kalamazoo,
Michigan v. Hotels.com L.P., et al., Case No. 2012-0450-CZ (Ninth Judicial Circuit Court, County of
Kalamazoo, Michigan). The complaint includes claims for declaratory judgment, injunctive relief, violation of
local tax ordinance, conversion, unjust enrichment, constructive trust, money had and received and joint venture
liability. On November 12, 2012, the defendant online travel companies filed a motion for summary disposition.
The court denied the motion on December 18, 2012.
Notices of Audit or Tax Assessments
At various times, the Company has also received notices of audit, or tax assessments from municipalities
and other taxing jurisdictions concerning our possible obligations with respect to state and local hotel occupancy
or related taxes. The states of Texas, New York, West Virginia, Colorado, Montana, Ohio, Hawaii, Maryland,
Arkansas, North Carolina, and Kentucky; the counties of Miami-Dade, Broward, Duvall, Palm Beach and
Brevard, Florida; the cities of Los Angeles, San Diego, San Francisco, Anaheim, West Hollywood, South Lake
Tahoe, Palm Springs, Monterey, Sacramento, Long Beach, Napa, Newport Beach, Oakland, Irvine, Fresno, La
Quinta, Dana Point, Laguna Beach, Riverside, Eureka, La Palma, Twenty-nine Palms, Laguna Hills, Garden
Grove, Corte Madera, Santa Rosa, Manhattan Beach, Huntington Beach, Ojai, Orange, Sacramento, Sunnyvale,
Truckee, Walnut Creek, Bakersfield, Carlsbad, Carson, Cypress, San Bruno, Lompoc, Mammoth Lake, Palm
Springs, San Jose, Santa Barbara, Santa Monica Bishop, Buena Park, Milpitas, Palmdale, Santa Rosa, and
Pasadena, California; the county of Monterey, California; the cities of Phoenix, Scottsdale, Tucson, Peoria,
Apache Junction, Avondale, Chandler, Glendale, Flagstaff, Mesa, Nogales, Prescott and Tempe, Arizona; Santa
Fe, New Mexico; undisclosed cities in Alabama; Jefferson County, Arkansas; the city of North Little Rock,
Arkansas; the cities of Chicago and Rosemont, Illinois; the cities of New Orleans and Lafayette Parish,
Louisiana; the city of Baltimore, Maryland, the county of Montgomery, Maryland; New York City, New York;
Greenwood Village, Broomfield, Durango, Frisco, Glendale, Glenwood Springs, Golden, Greeley, Lafayette,
Littleton, Longmont, Loveland, Silverthorne, and Breckenridge, Colorado;, Multnomah County and Portland,
Oregon; Lake County, Indiana; and Arlington, Texas, among others, have begun or attempted to pursue formal or
informal audits or administrative procedures, or stated that they may assert claims against us relating to allegedly
unpaid state or local hotel occupancy or related taxes.
The Company believes that the claims in all of the above proceedings relating to hotel occupancy taxes lack
merit and will continue to defend vigorously against them.
Actions Filed by Expedia
New York City Litigation. On December 21, 2009, Expedia, Hotels.com, Hotwire and other online travel
companies brought suit against the city of New York Department of Finance and the city of New York. The
complaint asserts two claims for declaratory judgment challenging the constitutionality and legality of the law
relating to New York City hotel room occupancy taxes passed on June 29, 2009. The City of New York’s motion
to dismiss the online travel companies’ claim that the city’s newly-enacted ordinance exceeds the scope of its
taxing authority has been granted. Plaintiffs filed a notice of appeal on December 6, 2010. On November 29,
2011, the Supreme Court of New York, Appellate Division, reversed the trial court’s decision and ruled in favor
of the online travel companies, holding that the ordinance exceeded the scope of the city’s taxing authority. The
City of New York filed a motion for reargument or leave to appeal. On April 26, 2012, the First Appellate
Division of the New York Supreme Court denied the city’s motion for reargument or leave to appeal. On
June 14, 2012, the city filed a motion for leave to appeal directly to the New York Court of Appeals. On
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