Orbitz 2011 Annual Report Download - page 27

27
defendants against the claims asserted by the City of Bowling Green, Kentucky.
On February 21, 2012, the United States District Court for the Middle District of Tennessee granted summary judgment
in favor of the online travel companies.
In addition, the following other material developments in the legal proceedings relating to hotel occupancy taxes
occurred during the quarter ended December 31, 2011:
On October 12, 2011, the Superior Court of the District of Columbia denied the online travel companies' motion to
dismiss the complaint filed by the District of Columbia.
On October 24, 2011, the Circuit Court of the Jefferson County, Arkansas granted the City of North Little Rock,
Arkansas's motion to intervene in the case filed by Jefferson County, Arkansas.
On November 28, 2011, the Court of Common Pleas of Lawrence County, Pennsylvania stayed the case filed by
Lawrence County, Pennsylvania pending the decision of the appellate court in the City of Philadelphia's appeal.
On December 1, 2011, Jefferson County, Arkansas filed their Motion for Class Certification.
On December 6, 2011, the Montana First Judicial District Court, Lewis and Clark County denied the online travel
companies' motion to dismiss the complaint filed by the Montana Department of Revenue.
On December 13, 2011, the Superior Court of the District of Columbia denied without prejudice the District of
Columbia's Motion for Partial Summary Judgment and denied as moot the online travel companies' Rule 56(f) Motion.
On December 16, 2011, the trial court held that Atlanta's conversion count remains pending and the City is allowed to
amend its complaint and add a breach of trust claim. On December 29, 2011, defendants filed a motion for reconsideration.
Audit Related Proceedings Related to Hotel Occupancy (and Related) Taxes
We have also been contacted by several municipalities or other taxing bodies concerning our possible obligations with
respect to state or local hotel occupancy or related taxes. The following taxing bodies have issued notices to the Company: the
Louisiana Department of Revenue; the Montana Department of Revenue; the New Mexico Taxation and Revenue Department;
Ohio Department of Taxation; the Wyoming Department of Revenue; an entity representing 84 cities and 14 counties in
Alabama; 43 cities in California; the cities of Phoenix, Arizona; North Little Rock and Pine Bluff, Arkansas; Aurora,
Broomfield, Colorado Springs, Golden, Greenwood Village, Littleton, and Steamboat Springs, Colorado; St. Louis, Missouri;
and the counties of Jefferson, Arkansas; Brunswick and Stanly, North Carolina; Duval, Florida; and Davis, Summit, Salt Lake
and Weber, Utah. These taxing authorities have not issued assessments, but have requested information to conduct an audit and/
or have requested that the Company register to pay local hotel occupancy taxes. Additional taxing authorities have begun audit
proceedings and some have issued assessments against the Company, individually ranging from $250 to approximately
$40.8 million, and totaling approximately $58.8 million. Some of these assessments have been issued on an estimated basis and
are not based on an analysis of transaction data, including the $40.8 million assessment.
Certain assessments made in these audit proceedings are administratively final and subject to judicial review. The
following is a description of the lawsuits brought by the Company challenging these final assessments.
In Re Transient Occupancy Tax Cases, Coordination Proceeding No. 4472 (Superior Court of the State of California for
the County of Los Angeles).
City of Anaheim
On February 1, 2010, the Superior Court for the County of Los Angeles, California granted defendants' writ of mandate
finding the City's ordinance does not impose a transient occupancy tax based on the retail price of hotel rooms rented by or
through the defendants and setting aside the Hearing Officer's decision to the contrary. On April 7, 2010, the Superior Court for
the County of Los Angeles, California denied plaintiff's motion for reconsideration of the court's February 1, 2010 Order. On
August 30, 2010, the Superior Court for the County of Los Angeles, California granted the online travel companies'
Consolidated Demurrer to the City of Anaheim's First Amended Cross-Complaint. On December 16, 2010, the Superior Court
for the County of Los Angeles, California issued a peremptory writ of mandate remanding the proceedings to the City's hearing
officer directing him to withdraw his February 6, 2009 decision ruling that the online travel companies are “operators” of