Orbitz 2014 Annual Report Download - page 22

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Item 1B. Unresolved Staff Comments
None.
Item 2. Properties
Our corporate headquarters are located in leased office space in Chicago, Illinois. We also lease office space for our
ebookers brand portfolio in various countries, including the United Kingdom, Finland, France, Germany, India, Ireland,
Sweden and Switzerland. In addition, we lease office space for our HotelClub brand portfolio, primarily in Sydney, Australia.
We believe that our existing facilities are adequate to meet our current requirements and that additional space will be available
as needed to accommodate any further expansion of our business.
Item 3. Legal Proceedings
We are involved in various claims, legal proceedings and governmental inquiries related to contract disputes, business
practices, intellectual property and other commercial, and tax matters. The following list identifies all litigation matters for
which we believe that an adverse outcome could be material to our financial position or results of operations, as well as other
matters that may be of particular interest to our stockholders. See Note 9 - Commitments and Contingencies of the Notes to
Consolidated Financial Statements.
Litigation Relating to Hotel Occupancy Taxes
Orbitz Worldwide, Inc. and certain of its current and former subsidiaries and affiliates, including Orbitz, Inc., Orbitz,
LLC, Trip Network, Inc. (d/b/a Cheaptickets.com), Travelport Inc. (f/k/a Cendant Travel Distribution Services Group, Inc.),
and Internetwork Publishing Corp. (d/b/a Lodging.com), are parties to various cases involving municipalities and other
governmental entities in the U.S. concerning sales and hotel occupancy taxes and our merchant model for hotel and car rental
reservations. Some of the cases are purported class actions, and most of the cases were brought simultaneously against other
OTCs, including Expedia, Travelocity and Priceline. The cases allege, among other things, that we violated the jurisdictions’
hotel occupancy tax ordinances, as well as related sales and use taxes. While not identical in their allegations, the cases
generally assert similar claims, including violations of local or state occupancy tax ordinances, failure to pay sales or use taxes,
and in some cases, violations of consumer protection ordinances, conversion, unjust enrichment, imposition of a constructive
trust, demand for a legal or equitable accounting, injunctive relief, declaratory judgment, and civil conspiracy. The plaintiffs
seek relief in a variety of forms, including: declaratory judgment, full accounting of monies owed, imposition of a constructive
trust, compensatory and punitive damages, disgorgement, restitution, interest, penalties and costs, attorneys’ fees, and where a
class action has been claimed, an order certifying the action as a class action. Some of these cases arose from tax assessments
or audits by taxing authorities, and Orbitz has brought claims in courts to challenge those assessments. Some of these
assessments, including an approximately $58.0 million assessment from the Hawaii Department of Taxation, are not based on
historical transaction data. On several occasions, where we have received an assessment, we have been required to provide
financial security or pay the assessment to the municipality in order to seek judicial review. Adverse rulings in these cases
could require us to pay tax retroactively and prospectively and possibly pay interest, penalties and fines. The proliferation of
additional cases could result in substantial additional defense costs.
We dispute that any hotel occupancy or related tax is owed under these ordinances and are challenging the assessments
made against us. The following table reflects the hotel tax cases in which we are currently a party: